The Value of Money–More Trouble Than It’s Worth

A coin clattered to the floor as a young man at the bar pulled his hand out of his pocket. From a corner booth I saw his ears perk to the sound but he didn’t turn his head until a voice–my own–knee-jerked “Oh you dropped…” I glanced at the ground to see a quarter, “…money.”

He made a sound between “meh” and “yeah” as he waved it off with a flick of his wrist and an eyebrow shrug and turned away again to his beer and hockey game on TV behind the bar.

I stared at the quarter on the floor, wondering how long it would stay there, wondering if I should pick it up, wondering if an unsuspecting server would slip, banana-peel-style with drinks and hot wings flying. Then I realized how long I had awkwardly been staring at the floor and I looked away. But I couldn’t shake a nagging feeling that things are not as they should be.

The Fugio Cent was designed by Benjamin Franklin and known as “America’s first coin”

As the paramour of a person who has recently taken up coin hunting, I was taken aback by this man’s dismissal of that dull metallic disk. For those unfamiliar with coin hunting (as was I only three short months ago) this is a hobby that is both more fascinating than it sounds, and just as dull as it sounds. One aspect that is really engaging (for nerds) is engaging in history to pinpoint the best locations to find coins in the ground with a metal detector. You can search historical records online, hit up local historical societies, view areal photographs to see how the area around you has changed and where buildings or fairgrounds or whatever used to be, and ponder the activities of those that lived in other eras: What were they doing? Where would they have amassed and dropped things? And what about the coins themselves? What years are they from, where minted, how did the metal composition change due to current events like war? What about different designs or printing flaws and how did they come to be? For example, that failed experiment of a dollar coin–the Sacagawea-well, a number were made in gold and shuttled on the Columbia into space as an intended gimmick for collectors, but a dispute arose between the US Mint and Congress as to whether the Mint was authorized to do so, and most were melted down, though some were kept for display; and some Sacagaweas were minted early for a Cheerios prize-in-a-box, and it turned out to be a real prize as the mold was subsequently altered. That’s some fine numismatic nerdery right there.

So one begins to realize that what’s printed on that coin or piece of paper is not necessarily always its “value”. Coins from 1964 or older, for example, are worth more than their face value in silver content. I can put it in a parking meter or I can keep it in a safe as an investment. So how do we really know what something is “worth”?

At this point, it seems, we believe what we’re told. There’s this agency named the Federal Reserve that isn’t really “Federal” at all that makes up the “value” of money and we believe it. But why?

It wasn’t always like this. If you really want to have your mind boggled, start reading about how the modern day banking system began, how we moved away from the gold standard, and how the precious metals and stock market is manipulated…it seems like the stuff of conspiracy theories, but this is on the record. I won’t even begin to try to explain this because I’m still wrapping my head around it. You can start with this video if you’re interested:

How the Markets Are Manipulated, James Corbett.

I had a conversation with my father years ago that stuck with me. My father was generally quiet about his thoughts but occasionally he opened up. On this particular night, I was ranting about money and wealth, as I was wont to do in my teenage and college years as “What do you want to be when you grow up” came to fruition, and I fancied myself quite the do-gooder. I therefore had/have a challenging relationship with money. He asked me “What is money?” I immediately and smartly answered “Power.” He shook his head and asked again, “What is money?” I was deflated and perplexed. I didn’t know where he was going. “It’s paper…?” He was nodding; he said “Money used to be necessary for survival.” I pointed out that salt used to be currency. Yes, he said, it was essential in society. Now what is it? It’s obsolete.” I had the light bulb moment: “It’s an idea.” Exactly. And having been in the oil refining business for three decades, he continued “And the most tangible equivalent today is oil. Without it the world would stop. We need oil to survive–to run our cars and use our computers and wear our clothes…”

The value of money is mutable in our increasingly global society. Lacking a solid foundation of tangible items to back the promise of paper causes more trouble than its worth, perhaps. We rarely even use the bills and coins nowadays to remind us that money is supposed to be something–most of it is transacted with the swipe of a plastic card as we become increasingly flippant about its value. I will never forget the moment in law school I acquired $10,000.00 more debt in a matter of minutes. I was walking across the center of campus on a bright sunny day from the financial aid office to my next class, with my cell phone attached to my ear. I had called my student loan provider to let them know I needed additional money for the semester. Those Stafford loans don’t cover tuition, you know. I was put on hold for only a couple of minutes and the voice came back and said, “okay, can I help you with anything else today?” That was it. I hadn’t even gotten from one building to the next yet. I remember thinking about how that was way too easy, and it felt like it meant nothing.

All these thoughts went through my head as I was jarred from my reverie by watching the dude at the bar get up from his stool, toss down some tip money as he tossed back the bottom of the glass, and walk out. My curiosity and sense of duty to my coin hunting partner wouldn’t let me leave that coin on the ground. And it was now officially abandoned. I got up from my seat and snatched it up: A 1995 quarter–no silver to speak of, but I get another hour in the parking meter.