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the cliché title of my essay that money really does make the world go round. I have chosen to examine closely this issue by investigating how we first became to rely on using money for everyday life rather than the old bartering system of trading. I am going to explore the development of money from metal coins, to paper to the well known “plastic friend” and how money has further evolved to exist mainly on a computer screen rather than in a physical form in people’s hands. By looking at this issue I hope to give the reader an understanding of how computerised transactions may have been a contributing factor to the current recession with many people becoming “paper millionaires”. Finally I am going to explore the conspiracy theory that there is a select minority of people in the world that actually control the vast amounts of money in the world, it is believed that these people belong to a new world order and may have had the powers to prevent money from moving around the world and therefore may have caused the recession. Money is relied on every day by millions of people around the world. Some use it for buying necessities such as bread and milk to feed their families and others use it on a wider scale to invest in stocks and shares to increase their wealth. Centuries ago, before money was invented many people used the system of bartering; this involved trading one good for another, such as a cow for a sheep or milk for bread etc, this system worked very well, and as it was matured, the idea of using commodities such as gold and metal coins was developed instead of trading. It must be noted however as uncivilised as this practise might sound in 2010 according to Niall Fergusoni “many sophisticated societies have actually functioned well without money1” Bartering has not become completely obsolete, a recent example published on the Times online website highlighted the largest barter of all time, which involved China agreeing to build a massive infrastructure in the Democratic Republic of Congo in exchange for copper and cobalt supplies worth an estimated £6 billion.ii Of late, Canadian author
Ferguson, N. (2009)”The Ascent of Money” Penguin Books Chapter 1. Page 20
Kevin MacDonaldiii told how he actually bartered a red paperclip for a number of different items, eventually ending up with a house. Stories like this would provoke the question why do we actually need money? In fact, many Communists in a contemporary society would argue that the world would be a better place if the system of bartering was still in place. As the world developed and became more advanced, bartering became increasingly phased out and money was invented. Gold and metal where both rare commodities and this influenced the system of putting a price on goods which people began to use and trade as coins. The system of using money has been credited as the “brainchild” of many different countries including Spain and Asia; however research has indicated that it first evolved from Italy. This caused a lot of coins to have the name Florence. The coins where made from metal and gold and where often very heavy, iv“The first use of banknotes in a modern economy came from the goldsmiths in England. The goldsmiths had secure vaults where they kept gold and silver coins. The goldsmiths found it convenient to give out receipts for a deposit of gold coins made out to the bearer.” Stephen Valdez 2 People would deposit their gold and receive a receipt that they could then use to give to someone else to pay for goods. Through issuing these kinds of receipts, the usage of cash developed. It was recognised that carrying cash was easier and weighed less than carrying metal coins. Each nation has their own form of currency; and this currency has a value that rises and falls due to the economic state of a country, or the political stability of the Government or the country. Currently the Euro has slightly lost some value because of the state of the Greek economy. The stability of a currency has a domino effect with regarding money going around the world, the more stable a currency is, the more trade that will go around the world. Presently the Sterling has fallen in value against Euro making UK goods more expensive for any of the Euro countries to buy, this has stopped money going around the world, as the euro countries are hesitate to buy sterling goods.
Valdez, S. (2007) “An introduction of global financial markets” 5th Edition Chapter 2. Page 16
Presently Cash is issued by the banks of each country and is guaranteed to give the represented value that is on each banknote. It must be noted that using cash and coins is not always a safe or guaranteed method of payment as there is always the risk of getting fraudulent notes and coins, (only recently in Northern Ireland, fake £1 coins were issued to many unsuspecting individuals.v) Another form of cash widely used in Ireland is cheques, there are 60million cheque’s issued in Ireland each year. However this form of payment is starting to become obsolete and it is predicted that by 2018 will no longer be used because of the advancement towards computerised money. As the world is advancing economically, there has been the development of the credit card. Too many, this is a wonderful invention as it has many advantages such as people no longer have to carry cash, it is small and light and easy to take around with you and it is accepted in most shops. The credit card also known as the “plastic friend” has many disadvantages such as through technical advances consumers are not physically able to see how much they are spending as they do not have cash in their hands, consumers simply just swipe the cards in stores and buy goods, they then move on to other stores and purchase other goods. Credit cards have caused many people to become addicted to shopping as they are often presented to women and men in department stores with promises of allowing you to buy what you what; however the sales reps issuing the cards often fail to explain the hidden charges or how it is important to manage the card properlyvi. Money also moves much easier around the world with the credit card as goods can be bought by a consumer in Dundalk from a seller in China using the card. Figures from the research group Lafferty,vii have highlighted how banks are facing losses of €23million because of the number or Irish people defaulting on their credit cards. There has been a large increase in recent years of the amount of trading online all over the world. Online trading allows billions of pounds, dollars and euros etc to systematically be moved from one country to another. One such example of this is buying stocks and shares on Wall Street, people from all over the world can buy and pay for stocks on a daily basis without having to go to a bank. It would also be nearly unheard of now for businesses to give wages to employees in cash, this is all done automatically
online. However, this development in technology has unfortunately been one of the main causes of the recession. The banks are one of the biggest culprits for creating and encouraging “paper millionaires.” A paper millionaire is someone who is wealthy on paper due to buying securities that where likely to have gone up in value, in the time of the boom.viii However, a paper millionaire in reality has no physical assets. The banks encouraged many people to buy securities such as bank shares with the promise of a large return on them, when the credit crunch hit, bank share prices plummeted, a notorious example is Bank of Ireland(BOI) shares which many consumers bought at €18 in the height of the boom, these shares are now only worth a mere €1.86 today. When the recession hit, the securities where one of the first things to de-value and become worthless, leaving many paper millionaires therefore broke. Numerous people around the world believe in a conspiracy theory known as the “New World Order” (N.W.O). Followers of the theory believe that there are certain wealthy elites around the world that actually control the amount of money that is available to everyone, it is believed that these individuals are plotting wars with oil abundant countries to increase their already vast amount of wealth. It is widely known that money gives a degree of power and thus power leads to a further increase in resources, which will give even more power to these elites in a position to manipulate the system and increase their vast wealth. Not only do these individuals want to control all the money in the world, they are also aspiring to have complete control of the world, and rule the world as one and not as many different countries. Jim Corr3 widely known throughout the world as a member of the Irish pop band the Corr’s has recently been focusing all his attention on bringing the N.W.O to the attention of the unsuspecting public. On his website Jim Corr has a full section all about how the N.W.O has been in existence for years and how it has had an impact on money around
Most of the information on the New World Order has come from the Jim Corr website. www.jimcorr.ie and the dedicated website www.theinsider.org which is solely dedicated to proving there is a new world order.
the world, for example former U.S. President James Garfield 1818. Stated “Whoever controls the volume of money in any country is absolute master of all industry and commerce. And when we realize that the entire system is very easily controlled, one way or another, by a few very powerful men at the top, you will not have to be told how periods of inflation and depression originate.”ix This shows that the N.W.O has been around for years and how an American President actually admitted to it. Corr continues with many points about how the Federal Reserve is controlled privately and is not publicly run as many believe. He quotes Milton Friedman as saying “the federal reserve definitely caused the Great Depression by contracting Americas’ supply of money by one third between 1929 and 1933” Friedman is a well known economist throughout the world, and his opinion is widely respected. For a well respected academic to make a statement such as this, one must question, is there an elite force acting in their own personal gain? From my research on the N.W.O I discovered that within the theory of the N.W.O the issues has been raised that the recent boom may have actually been manufactured intentionally to encourage people to take out loans with the secret motive of causing the crash, which would result in people wishing to be “bailed out” by the International Monetary Fund, resulting in the world becoming closer to being ruled by the elite force behind the N.W.O. Some evidence of this is that the European Commission proposing the creation of a “European IMF” to help countries mounted in debt such as Greece.x The plan is centred on the 16 euro zone countries having the one International Monetary Fund. This would make you wonder, are the secret elites beginning to surface! The conspiracy highlights that “poor countries hold 40% of the world’s population, but receive only 3% of the world’s income from trade. Rich countries make up 14% of world population and yet get 75% of the profit from trade”. Believers of the theory will also champion the idea that there are trade barriers up to prevent poor countries from moving away from poverty. The main thought behind the world order is that it is actually a case of “survival of the fittest” and that the elite force will always come out on top
From reading the N.W.O theory, one might be led to believe that the war in Iraq was thought up by the Americans and the British to invade the oil ridden countries under the pretence that there nuclear weapons hid there, but the actual intention was all about getting the oil to make more money. Not only do this elite group make money go around the world, but they are also powerful enough to make money go around each other’s “backyards”. Dick Cheney, the vice president of George.W.Bushxi (both suspected members of the N.W.O) awarded the contract of supplying food to the American troops in Iraq to his company Halliburton Corporation allowing him to actually profit from the War. Coincidence? You would have to wonder. The group of people suspected to be involved with the New World Order are some of the most elite in the world, including members of the Roosevelt family in America, Tony Blair, Warren Buffet, Bill Gates, Freemasons and many other wealthy people from around the world. Most of these members are quite reluctant to voice their beliefs about the fact that there is a New World Order. From researching my essay I believe the usage of money has come along way from the system of bartering, to computerised banking and this is down to the world becoming more advanced as each year passes. The fact that money makes the world go around is undisputed and the more money you have in this world the better positioned you are to survive. Money is needed for everything and certain individuals are believed to be trying to make money go around the world to increase their own wealth thus they are involved in a New World Order that will allow them to control all the money for themselves. The final question that has to be asked is will the present recession result in people wishing to revert back to the system of bartering and will the secret elite force remain hidden or will they surface now, that the world is in the midst of a severe recession and finally take over the world and make money go around in their favour? This will all remain to be seen.
Books Valdez, S. (2007) “An introduction of global financial markets” 5th Edition Palgrave Macmillan Chapter 2. Page 16 Ferguson, N. (2009)”The Ascent of Money” Penguin Books Chapter 1. Page 20 MacDonald,. K (2007) “One Red Paperclip” Ebury House Websites Niamh Hennessy. Banks lose €23million over credit card defaults. www.irishexaminer.ie 22 February 2010 http://www.examiner.ie/home/banks-loseeuro23m-over-credit-card-defaults-112797.html 22 February 2010 John-Paul Flintoff. Money is dead –long live barter www.timesonline.co.uk 11th January 2009 http://www.howbankingworks.ie/index.php? option=com_content&task=view&id=16&Itemid=32 22 February 2010 Martina Devlin. If only school had taught us how to make the best of our flexible friends www.independent.ie 14th June 2007 http://www.independent.ie/opinion/columnists/martina-devlin/if-only-school-had-taughtus-how-to-make-the-best-of-our-flexible-friends-701515.html 22 February 2010 Jim Corr. Financial Crisis. www.jimcorr.ie 20 April 2009 http://www.jimcorr.com/index.php? option=com_content&view=category&layout=blog&id=52&Itemid=109 23 February 2010 WTO cartel cause more starvation, suffering and death http://www.theinsider.org/news/article.asp?id=0407 22 February 2010 UN starts secret talks to create “New World Order” http://www.theinsider.org/news/article.asp?id=2656 22 February 2010 Irish State takes 15% stake in Bank of Ireland www.bbc.co.uk 22 February 2010 http://news.bbc.co.uk/1/hi/northern_ireland/8528082.stm 23 February 2010 European Enlargement-Towards one World government http://www.theinsider.org/news/article.asp?id=0014 22 February 2010 Cheney’s Former Company http://www.globalpolicy.org/component/content/article/221/46816.html 23February 2010
Warning on counterfeit pound coins. www.belfasttelegraph.co.uk 6th January 2010 http://www.belfasttelegraph.co.uk/community-telegraph/north-down/crimebeat/warningon-counterfeit-pound-coins-14624216.html 22 February 2010 European Monetary Fund being considered by Brussels www.bbc.co.uk 8th March 2010 http://news.bbc.co.uk/1/hi/business/8555890.stm 8th March 2010 Definition http://www.investopedia.com/terms/p/papermillionaire.asp 22 February 2010
Ferguson, N. (2009)”The Ascent of Money” Penguin Books Chapter 1. Page 20
John-Paul Flintoff. Money is dead –long live barter www.timesonline.co.uk 11th January 2009 http://www.howbankingworks.ie/index.php?option=com_content&task=view&id=16&Itemid=32 22 February 2010
MacDonald,. K (2007) “One Red Paperclip” Ebury House
Valdez, S. (2007) “An introduction of global financial markets” 5th Edition Palgrave Macmillan Chapter 2. Page 16
Martina Devlin. If only school had taught us how to make the best of our flexible friends www.independent.ie 14th June 2007 http://www.independent.ie/opinion/columnists/martina-devlin/ifonly-school-had-taught-us-how-to-make-the-best-of-our-flexible-friends-701515.html 22 February 2010
Niamh Hennessy. Banks lose €23million over credit card defaults. www.irishexaminer.ie 22 February 2010 http://www.examiner.ie/home/banks-lose-euro23m-over-credit-card-defaults112797.html 22 February 2010
http://www.investopedia.com/terms/p/papermillionaire.asp 22 February 2010
Jim Corr. Financial Crisis. www.jimcorr.ie 20 April 2009 http://www.jimcorr.com/index.php? option=com_content&view=category&layout=blog&id=52&Itemid=109 23 February 2010
European Monetary Fund being considered by Brussels www.bbc.co.uk 8th March 2010 http://news.bbc.co.uk/1/hi/business/8555890.stm 8th March 2010
Cheney’s Former Company http://www.globalpolicy.org/component/content/article/221/46816.html 23February 2010
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