The New Money Text Book
Economics Made Simple
MAY 2007
THE DEFINITION OF MONEY
The exact amount of money needed as the means of exchange
by a Nation, can be calculated using precise scientific principles
and by using the correct definition of the word “money”.
To reach agreement as to what is a correct definition of
money, we must first agree upon the purpose of money. The
sole purpose of money is as a means of exchange. We need
a means of exchange, in order to advance beyond a barter system.
A competent means of exchange must be used for no other
purpose.
In order to fulfil that purpose, money requires two attributes.
Firstly, there must be an adequate source of supply of money,
upon which a successful economy can draw as the society prospers.
Money is man-made stuff and to service a successful economy,
as it flourishes and prospers, additional new money will be
needed. An ability to create and issue additional new money
into circulation must exist. At the same time the money supply
must be responsive to strict control.
Secondly, there must be a reliable yardstick by which to
measure the value of money. This attribute is absolutely essential,
so that the issuing authority of money, can calculate the
correct speed at which additional new money must be created
and issued.
Having stated these requirements, we can devise a definition
of money, based upon its purpose and usage. A definition,
which has never previously existed.
The new, correct definition of money is an idea backed by
confidence. An Idea Backed by Confidence
(From the writings of L Ron Hubbard) That makes confidence
of supreme importance. At this time, credit is being substituted
for real money. The bottom line is that the term “credit”
is being substituted for the word “debt”. When money
is replaced with credit, no one anywhere can have confidence
in what is essentially debt, or in credit, as we are now expected
to designate debt. Herein lies the root cause of the economic
spin; not knowing the true definition of money and leaving
aside the necessity of having confidence in what we use as
money.
It is a new definition of money, because until Mr Hubbard
defined money as an idea backed by confidence,
a reliable definition of money had never existed. Without
a useable, accurate and correct definition of the key word
of that subject, economics has been a shambles and unfit for
purpose. As Ezra Pound told us “ In our time,
the curse is monetary illiteracy, just as an inability
to read plain print was the curse in earlier centuries”.
When a person reads the written word, without knowing the
meaning of the words, he is to that extent illiterate.
Money is a man-made means of exchange, in which Man can
have complete trust. The value of money will derive from trust
that it does truly represent the value of goods and services
successfully exchanged in the market place.
 
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