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What is Money? What is 'money'? How is the supply of money affected by the aims and the actions of the commercial banks, the central bank, and the government's financing of the PSBR? The Concise Oxford Dictionary defines money as "a current medium of exchange". This definition, if rather sparse, does detail the essential nature of money: it is a recognised form of exchange for goods and services. It can take many forms: anything which is accepted by the seller, because it has a recognised value which can be used to purchase further goods and services, will suffice as money. Why money exists, even in centrally planned economies, is because it is efficient. A barter economy, in which no money was used, requires those wishing to make a transaction to exchange goods and services. The complexities involved in such a system are immense. For example, an apple seller, wishing to obtain a...

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