Where's all the money? Is it even real?

There's a lot of panic in the media again lately, about global stock market losses or something or other.

According to the media, markets everywhere in the world are down and 'in turmoil', which apparently means we're all skint again.

I don't get it. Surely the money is somewhere, if its real at all.

If I have a £10 note in my hand, and the wife takes it off me, then I'm £10 down. I can rightly say that my finances have taken a hit. But surely she is then £10 up, so all in all, the same amount of money still exists in total.

Yet it seems that when its banks and stock brokers involved, someone loses their money, and everyone loses their money at the same time. It must be going somewhere. Someone must have it.

Maybe I'm missing something, but it certainly confuses me.

So, if the money is real, it must be somewhere, so you can have a global loss.
If its not real, then how on earth does anything work? How, for example, do we decide that a tenner is worth a tenner? Or even what a tenner is?

 

The slobs that run the banks have had it all as bonuses...........

 

It all lost credibility after 1921. Before that the value of coinage was in the coins. Sterling silver. After that we carried on with 50/50 sterling/ nickle, then we lost all the silver, then the copper out of the lower value coinage.

Now even the 1p's & 2p's are not worth anything, leave them out in the rain and they will rust and corrode.

Basically, the government has sold off all the money

 

I think the media talked us into the last recession. Not happy with that, they're going to give it another go!

I also think we should get rid of cash and go back to bartering, that would knock the greedy bankers on the head.

Just another thought........if you've got gold crowns (of the dental sort) hang on to 'em, they'll be worth a fortune. Can't get them on the NHS now, they've down graded to silver!

 

Clueless - it never was real. That's why its so dangerous.

If you deposit £100 in a bank, the bank is able to lend out ten times as much. ie the bank can now lend out £1,000. The extra £900 is credit - its not real. If that £1,000 is all deposited in other banks, then those banks are able to lend out another 10 times, ie £10,000. And so on and so on and so on. By law American banks are only allowed to lend out 10 times, but some banks have been lending out up to 150 times their reserves. Not only is this really dangerous, its also highly illegal - but no one will be prosecuted.

We are in a bubble of unreal credit, exactly the same, as JWK said, as the Dutch Tulipomania, also The South Sea Bubble, and the 1929 crash. Every one will say they never saw it coming, but many people, including myself, have been expecting it for some time. Because the money was created out of thin air, it was held to be "real" purely by people's confidence. Once that confidence goes, the money will disappear in a similar manner to which it was created. If someone removes £100 from their bank, the bank has to call in the £1,000 that they lent out based on that £100. And so on and so on and so on.

I am afraid that we are only at the start of a very long slide.

 

I don't claim to understand the money markets at all. The frightening thing was that when it came down to it the whizz-kids in the City - you know, the people we were told had to be paid ridiculous sums because they were essential to the nation's prosperity - didn't really understand them either.

Something is only worth what another thinks it's worth. If sterling, God forbid, ever became regarded as a serious bummer, then your tenner would only be good for wallpaper. We'd have to pay for things in Chinese yuan or something, I suppose - just like countries with weak currencies once put their faith in the American dollar. At least if everything goes pair-shaped people will stop going on about how much their houses are worth, I suppose. It's an ill wind ...

 

A lot of us are guilty of speculating but don't realy think of it. Everybody who has borrowed on there house value is speculating that prices will increase anually, where would they be if houses dropped by 30% in value. do you think that it is unthinkable, the bank traders thought their speculating crashing was unthinkable. The money we borrowed on the houses isn't real money if the prices drop.
Another thing that has happened is that we have been spending billions in China on cheap goods and they have not been buying from us to give it back. So where do you think the money is?

 

The money is always somewhere. One just have to find where.

 

You're mistaken there, they have been buying from us. They have bought our electricity supply company from the French who bought it when Maggie Thatcher privatised it.

 

Lots of interesting, if somewhat comprehensive responses so far.

I think the general gist of it is that money is not real, hasn't been for centuries, and is in fact a purely imaginative construct.

I once had a go at reading the English translation of The Tibetan Book of the Dead. Its one of the many scriptures of Tibetan Buddhism. Most of it was way beyond my understanding, but one bit stuck in my mind. After struggling to follow several pages about illusion, delusion, resignation etc, the chapter concluded simply, "all this proves that reality is the product of the collective imagination". Very appropriate it seems.

 

I dug up a half pence today, it was made of real copper. Forgotten how small they were.

 

When I dug over my back garden, I found a number of old coins. One, so badly corroded I had to leave it in Coca Cola all night to get it clean enough to read the print on, was a penny from 1916.

One or two, and I'd have just figured an old gardener had holes in his pockets, but so many, made me wonder if a former owner was superstitious and had made offering to the faeries.

I dug most of them back in, just in case, but kept the old penny and replaced it with a new one just in case the little people decided to kill all my cattle as punishment (if I ever get any cattle).