Which is Better Paper or Electronic Currency? Essay

Total Length: 753 words ( 3 double-spaced pages)

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Paper Money vs. Electronic Money

I would define money as a form of currency that represents a store of labor or value (Davies, 2004), which can be exchanged for goods or services. Money does not have to be “backed” by anything—though some feel it should be backed by a standard such as gold, which is universally acknowledged as having value (Kemp, 2001). In actuality, one’s government has a natural right to coin its own currency and issue it to citizens. The fact that our government has given up this right to the central bank, from which it borrows money at interest signals that the true government of our nation is the central bank, since it possesses the authority formerly held by kings.

Extending from that fact is the idea that the “notes” we are issued from the bank have value—but the paper money (fiat, as it is called because the banks print it at will and loan it to our government) has done nothing but lose its value over the past century. One can easily look at where prices are today and where they used to be to see how the currency has been devalued.

Paper money will continue to be used by those who prefer to shop with it. Some people like having cash in their pocket which they can easily exchange for goods or services.

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They do not have to rely and electronic exchanges; or they do not want to have to pay for something using a credit card or bank card. Cash makes transactions simpler and also makes it harder for totalitarian governments to keep track of what you are spending money on. At the same time there are others who feel that electronic money is far simpler to use: one need not worry about always have cash in one’s pocket—a simple credit card or bank card will do the trick. One can also earn “points” or “cash back” by using a credit card, so there is that incentive as well. So there are good reasons on both sides, and I do not think we will see a dramatic drop in the use of paper money over the next five years—at least not any more than the rate has dropped in the past ten years.

I am in favor of using electronic money because it makes making….....

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Davies, R. (2004). Origins of money and banking. Retrieved from http://www.ex.ac.uk/~RDavies/arian/origins.html

Kemp, J. (Jun 28, 2001). Our economy needs a golden anchor. Wall Street Journal. (Eastern edition). New York, N.Y.: pg. A.16

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