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that the institution of money gives us a more flexible approach to trade than barter, which has the double coincidence of wants problem. Also known as dual coincidence of wants. Since money is a recognized medium of exchange, I do not have to find someone who has a pair of new shoes *and* is looking for a Wayne Gretzky hockey card. I just need to find someone who is looking for a Gretzky card who is willing to pay enough money so I can get a new pair at Footlocker. This is a far easier problem, and thus our lives are a lot easier, and our economy more efficient, with the existance of money. What Is Money And How Is It Measured? As for what constitutes money and what does not, the article How much is the per capita money supply in the U.S.? <http://economics.about.com/cs/money/a/money_supply.htm> gives the following definition, provided by The Federal Reserve Bank of New York: "The Federal Reserve publishes weekly and monthly data on three money supply measures -- M1, M2, and M3 -- as well as data on the total amount of debt of the nonfinancial sectors of the U.S. economy... The money supply measures reflect the different degrees of liquidity -- or spendability - that different types of money have. The narrowest measure, M1, is restricted to the most liquid forms of money; it consists of currency in the hands of the public; travelers checks; demand deposits, and other deposits against which checks can be written. M2 includes M1, plus savings accounts, time deposits of under $100,000, and balances in retail money market mutual funds. M3 includes M2 plus large-denomination ($100,000 or more) time deposits, balances in institutional money funds, repurchase liabilities issued by depository institutions, and Eurodollars held by U.S. residents at foreign branches of U.S. banks and at all banks in the United Kingdom and Canada." So there are several different classifications of money. Note that credit cards are not a form of money <http://economics.about.com/cs/money/a/credit_cards.htm>. Note that money is not the same thing as wealth. We cannot make ourselves richer by simply printing more money, as shown in the article Why Not Just Print More Money? <http://economics.about.com/cs/money/a/print_money.htm>. Here are a few more articles that will aid in your understanding of money: * What is Deflation and How Can it Be Prevented? <http://economics.about.com/cs/inflation/a/deflation.htm> * Why Does Money Have Value? <http://economics.about.com/cs/neoclassical/a/value_of_money.htm> * How Much is the Per Capita Money Supply in the U.S.? <http://economics.about.com/cs/money/a/money_supply.htm> * What is the Demand For Money? <http://economics.about.com/cs/money/a/money_demand.htm> * Are Credit Cards A Form Of Money? <http://economics.about.com/cs/money/a/credit_cards.htm> * Expansionary Monetary Policy vs Contractionary Monetary Policy <http://economics.about.com/cs/money/a/policy.htm> * Why Not Just Print More Money? <http://economics.about.com/cs/money/a/print_money.htm>

* What Was The Gold Standard? <http://economics.about.com/cs/money/a/gold_standard.htm> * When Stock Prices Go Down, Where Does the Money Go? <http://economics.about.com/cs/finance/a/money_lost.htm> What Is Money? * Money Defined - A Dictionary Definition of Money <http://economics.about.com/od/termsbeginningwithm/g/money.htm> * Money Supply - Dictionary Definition of Money Supply <http://economics.about.com/od/termsbeginningwithm/g/money_supply.htm> * Money - Glossary - Dictionary Definition of Money <http://economics.about.com/library/glossary/bldef-money.htm> More Economics Resources * Macroeconomics Help for Students <http://economics.about.com/cs/studentresources/a/macro_help.htm> * Microeconomics Help for Students <http://economics.about.com/cs/studentresources/a/micro_help.htm> * Econometrics Help for Students <http://economics.about.com/cs/game_theory/a/game_theory.htm> Even More Economics Resources * Economics Term Paper Help <http://economics.about.com/cs/termpaperhelp/> * Win Money! - Moffatt Prize in Economics Writing <http://economics.about.com/cs/studentresources/a/moffatt_prize.htm> * How to do a Painless Econometrics Project <http://economics.about.com/cs/termpaperhelp/a/term_paper.htm> Related Articles * What Is Money and How Much Is There? - Currency Trading <http://www.netplaces.com/currency-trading/moving-the-currency-markets/whatis-money-and-how-much-is-there.htm> * The Development of Money - Economics <http://www.netplaces.com/economics/the-story-of-money/the-development-of-mo ney.htm> * Money Supply Definition <http://useconomy.about.com/od/monetarypolicy/f/money_supply.htm> * Other Charts, Technical Indicators, and Money Supply - Day Trading <http://www.netplaces.com/day-trading/adding-charts-to-market-analysis/other -charts-technical-indicators-and-money-supply.htm> * What is a Nation's Money Supply? <http://internationalinvest.about.com/od/glossary/a/What-Is-A-Nations-MoneySupply.htm> Ads <javascript:zpu(512,uy+'/z/ad/wasl.htm',450,425,'wao',100,100)> LIC Jeevan Anand Plan <http://www.googleadservices.com/pagead/aclk?sa=L&ai=CfGa_VhYrUp_XBYeekwSH04HoBZ -cy6kD95bb4mTAjbcBEAYgqKX3ASgJUOCFgo_______wFg5cLkg6QOoAHZ_qDbA8gBAakCFLzLfVV1UD 6oAwGqBIMBT9B2MR4ACdtu8vXL_UbNRPu0_Ee_CpmR3RhfBm-oVQBENwfKKhsNjDFNMC3TJ43XukdHSa TmIXagPZINeuZPOL7zo7I0XOfLwaGkjDFmo9L7WmoWxVy8jvrZ6MQzYHR6BkD52NFZsPp1phPIAA4OFC

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