(2004-04-16) Smith Money

Willy Smith on the Napster-izing of Money (DigiCash). Money historically has two properties: it is a Medium Of Exchange, and it is a Store Of Value. However, over the past hundred years, we have totally lost the concept of money being a store of value, and have even taken it to a new extreme of worthlessness: now it's simply an intangible digital phenomenon. Since it has no intrinsic value, its worth is determined by only one thing, which is trust. I am beginning to see some cracks showing in the system. These cracks are from an eroding trust. Things like frozen bank accounts, forced currency devaluations, and Stock Market losses wiping out individuals' Retirement plans have got to eventually force people to realize that money isn't what it used to be (Cash Money)... One of the ways money is transferred outside of the "normal" banking system is by hawala. This is the Arabic word for "transfer". You can read the whole World Bank report on how it works in Afghanistan [here](http://www-wds.worldbank.org/servlet/W D S Content Server/WDSP/IB/2003/10/16/000090341_20031016085357/Rendered/INDEX/269720PAPER0Money0exchange0dealers.txt) .