In the third paragraph of The Hitch Hiker's Guide to the Galaxy the author, Douglas Adams, describes Earth. He says:

This planet has - or rather had - a problem, which was this: most of the people living on it were unhappy for pretty much of the time. Many solutions were suggested for this problem, but most of these were largely concerned with the movements of small green pieces of paper, which is odd because on the whole it wasn't the small green pieces of paper that were unhappy.

It is true enough to say that 'money makes the world go round', because the world today simply could not function without money. This entry tries to be entirely neutral about whether money is good or bad.

Money originated as a convenient way of exchanging goods and services. The scope of money has increased dramatically over time, even in the last 150 years. It has been perfectly possible to use bartering, instead of money, in times and places where things or simple services are being exchanged. If one person gives some of their eggs in return for some of another person's vegetables, then both people get a varied diet. But as most of us have moved away from dealing directly with things, even homely things, like knitting jumpers or baking cakes, we increasingly need money as a neutral means of exchange.

God and Mammon

So if money is essential, as it undoubtedly is, where does it get its bad press?

St Paul is often misquoted as saying that money is the root of all evil. In fact, what he said is much more interesting than that. He said 'The love of money is the root of all evil'¹. Jesus Christ put it more explicitly still when he said 'No man can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon.'²

It is interesting to note that both men talk of 'the love of money' and 'serving two masters'. They do not say that money is bad. What they say is that pursuing it will undermine your faith in God, which is a subtly different statement.

In fact, money is one of the few things which requires the same relationship between itself and people as that required by a god.

In theory, not all gods expect to be worshipped. It is enough for some gods that people believe in them and this entry is about belief, not about worship. Terry Pratchett spent an entire book, Small Gods, exploring the idea that deities are only powerful in the world in proportion to the power of the belief in them. This entry argues that the power of money in our lives comes only from our collective belief in that power.

You can see this relationship between money and belief very clearly in the way that currencies, such as the dollar or the euro, are only powerful in the world in proportion to our confidence in them.

Think about the way in which we talk about money. We call the currency in the US 'the Almighty Dollar', implying a divine omnipotence. We say 'the pound is strong' or 'the euro's fallen' as if they are separate entities. What is actually happening though, is that more people believed in the pound than believed in the euro on the day in question, therefore each currency's 'power' has changed in proportion to people's belief in them.

The power is real enough, but money isn't and this is a scary concept.

A Run on the Bank

It is easy to think that derivatives and options and junk bonds require belief because they are complex instruments and hard to understand. But this entry argues that all money requires belief, not just futures and gilts and shares in dot-bombs³.

The wording on a bank note is a promise. (British and other bank notes are effectively bearer bonds drawn on the bank, with their statement 'I promise to pay the bearer on demand the sum of...'.) But the reason bank notes work is that we can, and do, believe that this promise will be fulfilled. When for any reason we can't believe it, the notes become worthless. If you still have any German marks, French francs or Italian lire, they are now worthless, due to the introduction of the euro. You can no longer believe that they will be redeemed despite the fact that they are the same marks, francs and lire as they were in 2001. What has changed is the banking structure that supported them.

In the 19th Century there were a large number of private banks in the UK which printed their own currency⁴, but when any bank that issued notes went bankrupt their bank notes became worthless. Now imagine people on a 19th Century ship. They will continue playing poker or agreeing to buy or sell property or services between each other using these 'worthless' bank notes. The notes are not valueless on the ship, because the people on the ship still believe them to have value. The notes don't become without value until the ship docks and the people get the news that the bank has gone bankrupt.

It would not be true to say that money has no connection with tangible reality. It is, however, true to say that the connection is entirely within our minds.

Nothing Up My Sleeves

And these days money does not even signify cash.

Nowadays, money is a stream of data; we all have millions of dollars passing through our bodies all of the time. The fact that they pass through us in the form of wireless data-transmissions does not make them any less real; or more accurately, when those data-transmissions hit bank accounts the ones and zeros in magnetic media and databases are no more real there than they were when they were microwaves passing through the window of the sports shop or the woman queuing for the bus.

We are part of a mass hysteria six-billion-people-strong. If someone does not have enough money, they will believe themselves to be in deep trouble and because they, and the rest of us, believe it so strongly it is true: they are in deep trouble.

Fairy Gold

So what are we actually believing in? Chambers' Dictionary defines money as:

Pieces of stamped metal used in commerce; any currency used in the same way

It defines currency as:

that which circulates, esp. the money of a country

Neither of those definitions is particularly helpful, and both of them ignore some of the fundamental things about money:

• Money is worthless.
• Money is - quite literally - not worth the paper it is written on.
• Money has no inherent value at all.
• It gains all of its value from the value we place on it.

Dollar bills are just so much food or toilet paper to chimpanzees, but give a chimp donuts and it will eat them. A woollen blanket has an inherent value if you are cold, food has an inherent value if you are hungry. But gold is just a pretty metal which is reasonably rare and which has certain interesting chemical properties. There are industrial uses for gold (as connectors for hi-fi leads, for example) but the value we give to gold is far above its intrinsic worth.

Money itself can really only be used for decorating the backs of bars and making sure that long case clocks run on time.

Would You Credit It?

When we take a closer look we find that as our belief in money has increased various other mind-sets have had to move out of the way.

As has already been mentioned, the scope of money has increased dramatically. This has happened because we have moved further away from working with things that have an inherent value. If you are a farmer, the crops and animals you work with have an inherent value. If you do physical labour, from building to cooking, you are working with things that have an inherent value, but a decreasing proportion of people work in that way. New jobs are created for people to provide customer service, or high quality consultancy, or other acts of 'illusion'. One symptom of this, it seems, is that we place a higher value on the intangible - services rather than product, value-add rather than value, intellectual capital rather than inventory.

Now this is where it gets interesting. Because as the reach of money has waxed, our belief in traditional gods - whether they are old men on clouds, or young men with wounds in the wrists and ankles, or green men in the woods - has waned over much the same time period.

It is almost as if there is only so much belief in the world, and it has to be applied to something which does not exist.

The more money becomes dislocated from reality, the more it appears we believe in it.

Trading Futures

Where there is money there are also winners and losers. A lot of people therefore look at alternatives, such as Local Exchange Token Schemes, in search of ways to undermine money. However, these are tweaks to an existing system; like moving away from an Old Testament God of wrath to a New Testament God of love.

The changes in the world which will bring about the end of money are alluded to by the author Iain M Banks who has devised a proverb for his galactic civilisation, the Culture:

Money is a sign of poverty.

And it is. We live in an age of scarcity - not enough energy, not enough food, not enough transport, not enough anything for most people. So we dole it out according to how much of some arbitrary medium of exchange each of us manages to earn or steal or inherit.

In principle, there is no reason why at some point well into the future we shouldn't all have as much as we want of whatever we want, for free. There are plenty of raw materials literally lying about the place. A combination of realised nanotechnology and strong, self-modifying artificial intelligence will make it inevitable. It will be a time of serious upheaval as all the high priests of the church of money, realising the impending global recusance⁵, start kicking and screaming - it won't be pretty. The limit is not the scope of human fear, rather it is the scope of human technology.

It is possible that our defection may already be beginning. At this point we cannot tell whether the disillusion, caused by what appear to be accountancy sleights of hand at Enron, WorldCom, AOL Time Warner and others, is the first stirrings of disbelief, or if it is merely unrest in the congregation. The anarchists aren't those weird guys with wispy beards and bulging eyes who throw traffic-cones at McDonalds.

The anarchists are the investors who suddenly doubt the system that craves belief.

Nature Abhors a Vacuum

What may be a critical factor in evolving beyond money is that it appears that human beings need something intangible in which to believe.

When we no longer believe in God, and we cannot believe in money, what will we believe in?

The Apostate's Greed

Now if you find the above concepts uncomfortable or disturbing, read the following. It may help you come to the comforting, and maybe illusory, conclusion that you needn't take these ideas seriously.

I believe in Cash
In the Pound Almighty
financer of Heaven^(tm) and Earth^® (pat pending),
And in Interest, its only gain, our fraud.

Which was conceived of the treasury,
born of the Royal Mint,
suffered under decimalisation and monetary union
until the deutschmark was dead and buried.

Cheques descended into BACS.
On the third day (if you are lucky) they rise again and are paid,
and ascend into a current account, to sit at the right hand of the Bank Manager
who judgeth the scraping-a-living and the dead rich.

I believe in the wholly corrupt,
the International Monetary Fund,
the World Trade Organisation,
the forgiveness of debts,
the resurrection of economies,
and Capitalism everlasting.

ATM