SHILL Issue 72

trade trade
trade
trade
SecretSphinxes
Common Cents
trade trade trade
A variety of coins, some ancient, some newer. All pieces
of metal that “had value” at some point in the past.
trade
would consume an entire dissertation paper for a PhD candidate.
I’ll list a few statements about our current system
that will demonstrate this point:
There’s been no gold standard backing the U.S. dollar
since 1971.
Corporate banks are cycling money so quickly that the current
margin reserve requirement for most of them is 10%
— what’s required in the bank at any given point.
Your paycheck deposits are just numbers credited and debited
to your account — no money changed hands to ‘give’
you the money that you worked for.
Around 10,000 years ago, prehistoric humans began
to shift from hunting and gathering into a farming lifestyle,
cultivating grains and domesticating animals to
better ensure the survival of their social groups. It’s a
well known descent into complex civilization from that
point on, and the pace that we’ve been able to develop
is incomprehensibly rapid on a universal time scale. The
very first humans had barely any interaction with other
groups of humans, but as we advanced technologically,
it allowed us to expand our reach across geographical
regions, and this quickly prompted the act of bartering
for goods that were unique to different locations.
Currencies facilitated the act of trading, providing a
common medium of exchange between parties sitting
at the table. In those days, there was really no set definition
for currency — shells, bones, clay tablets, and eventually
metals all were considered valid goods that could
be exchanged for something necessary or something
desired. The key for bartering was that there was always
a side of the deal that needing something from the other,
and this created the ‘value’ in the trade — one side
depended on the other for goods that it needed to survive,
and vice verse. These humble beginnings set the
standard for our capitalist society that we live in today.
This article isn’t a history lesson, even though the development
of currency is a fascinating subject. I just wanted
to touch upon the roots of trading to introduce the
ideas of this essay, and how they’ve been adapted into
a modern era that certainly no prehistoric spice trader
could comprehend. We live in an age where currencies
are completely detached from any sort of real value;
tracing all the developments that lead to that point
This system is by no means a terribly-designed system; it’s
just the amalgamation of centuries of financial practices
that all culminated in the global economic system that we
use today. There’s really no way to untangle all of this without
causing catastrophic failure of world governance, and
so it’ll continue to persist and build on top of itself. But it
boils down to the fact that when we’re trading assets, we
can never fully own anything, even though it feels that we
do.
Alright, this isn’t a doomsday essay, and that wouldn’t make
for quality reading, anyways. The point I’m making here is:
when we trade assets, where do we derive value from? In
prehistoric shops, bazaars, and shipyards, the wares being
bought and sold were valuable because they were foundational
goods, necessary to keep people clothed and fed
and watered and bejeweled.
Individual traders needed to protect their livelihoods, and
so formed companies to pool their assets and ensure
against loss, which created the first derivative assets: company
shares. We still trade these today, but their value isn’t
completely based on the goods anymore; it also has to
factor in shareholders’ interests and future projections of
revenues, which theoretically have no tangible value. Skip
a few rungs on this slippery financial ladder and now you’ll
find yourself at the NFT scene, a derivative asset of a governance
token that is a critical piece of a digital ledger that
records transactions of digital currencies that are backed
by belief in the use-case of the technology. Imagine trying
to explain this to a vassal lord who just pledged a galleon
to the East India Company in order to hedge his shipping
costs!