The Real Value of Currency

On this planet, there exists a constellation. A constellation that protects you… safeguards your home… and feeds your family. It is known as the Eurion Constellation. You can see this constellation almost everywhere
on Earth, regardless of the time of year, or whether it is day or night. But you won’t find this constellation on
any star chart or in any astrologer’s book. Because this constellation has nothing to
do with the cosmos. I just really wanted to use that stock footage
of stars and do a cool voiceover for the intro… Yeah. The Eurion Constellation is a real thing and
I’ll get back to it in a moment, but this video is about currency. So what is currency? First and foremost, it’s a unit of exchange. That means you use it to get other stuff. Otherwise you’d be using chickens and I
dunno, wood? It’s portable. So unlike chickens and… wood, you can put
a lot of it in your pockets or wallet or bra or whatever… and it’s durable so it’s
unlikely to get damaged and lose value while in your pockets or wallet or bra. It also has to be divisible so that you can
pay exactly what is owed without rounding up and overpaying. First of probably many side notes… in order
to be divisible, they come in different denominations, the same word that used for churches and while
people do worship the stuff that’s pretty much where the similarities end. In both the Euro and the Dollar there are
seven paper notes. The Euro calls them banknotes and they are
the 5, 10, 20, 50, 100, 200, and 500. The Dollar calls them federal reserve notes
and there is the 1, 2 – that’s right, the 2, it’s not some special collector’s
item like your grandma thinks, they make new ones all the time – 5, 10, 20, 50, and 100. That’s it, there’s nothing higher than
that anymore. We used to have a 100,000 dollar bill that
was discontinued in 1934. It was only ever used to transfer money between
banks, because back in the day the only way to move large amounts of money between banks
was to put it in a safe on the back of a horse and… good luck! When it comes to coins, the Euro has eight. The 2 euro, 1 euro, 50 cent, 20 cent, 10 cent,
5 cent, 2 cent and 1 cent. Many countries either have or will soon phase
out their 1 and 2 cent pieces because… well I’ll get to that in a second. The dollar has the dollar coin, half dollar,
quarter, dime, nickel, and penny – the bane of many a youtuber. The American penny is made of copper covered
zinc, and if you melted it down and sold the metals, you would make 1.5 cents. The Euro 1, 2, and 5 cents are all made of
copper covered steel and depending on the country costs around 5.5 cents to make, which
is why many countries have or are trying to ditch the 1 and 2 and just keep the 5 cent. The American nickel isn’t doing too well
either, and costs 6.3 cents to make. So when it comes to the lower denominations
for almost all currencies, they cost more to make than they have in value. Which brings us to the last definition of
currency, and one which will make many economists angry at me for saying, it is a store of value. The reason that will make economists angry
is that they will say money is a store of value, and currency is just a representation
of value. I’ll get to why I personally disagree with
that distinction later, but back in the day, our money, if it wasn’t just flat out made
of gold or silver, at least had a real value of gold or silver attached to it. In the United States we started off on the
Silver Standard, a dollar being defined as 24.056g of Silver. In 1900, we switched to the Gold Standard,
redefining the dollar as 1.505g of gold. You could walk into a bank and get that equal
value in gold in exchange it even said so on the dollar. But that really kind of holds the currency
back, you aren’t going to have many more dollars in circulation unless you invade somewhere
and come across a bunch of new gold. So combined with the fact that many European
countries had already done so, in 1971 the United States likewise abandoned the Gold
Standard and let the dollar become free-floating Fiat Currency, which just means that its value
is backed by the government which issued it and nothing else. So how much is a dollar worth? It’s not worth anything, it’s worth a
dollar. It’s worth slightly more than a bag of skittles
or like a third of a gallon of gas. It’s not pegged to anything like gold or
silver, but you can still go buy gold and silver with your money or currency which… don’t… but again I’ll get to why I think
that later. But since its value is backed by the government
it is also protected by the government. In order to protect that value, you have to
protect it against counterfeit. Now I’m not going to go through every anti
counterfeiting measure like the little strip or the watermark or whatever, because everyone
knows about those and they’re boring. You don’t come here because you wanna be
told old stuff, you wanna know new stuff. So let’s talk about some that you probably
don’t know. Here’s a favorite among lots of people who
like to ruin movies. What’s wrong with this scene? Absolutely nothing is wrong with this scene
actually. I don’t know where this rumor came about
money burns some different color, but it doesn’t. Defacing or destroying US currency is illegal,
and since I’d rather get in trouble for copyright than for burning money, here’s
someone else’s video where they burn money. See? It burns the normal fire color. There’s nothing special about it, it’s
made of cotton and linen, it actually isn’t even paper. But it’s again illegal for people to counterfeit
money, even in the movies. So whenever you see money in a movie, it’s
real, it has to be, by law. I mean, they’re not going to burn money
but whenever you see it in a briefcase or whatever, that’s real money, at least the
top layer anyway. That blew my mind when I found that out. But here’s another one, in my intro you
saw me put a dollar bill in my scanner. You shouldn’t do that, or any of the other
things in my intros, but on top of that, you CAN’T do it. Your scanner or copy machine simply won’t
do it. Because of the Eurion Constellation. It was introduced in 1996 and it’s on almost
every paper currency around the world. Where is it on the 20? Oh, it’s all of the zeros from those random
20s everywhere. Here it is on the pound, and the euro… and
you probably never even noticed it. The moment your scanner or copier detects
that constellation, it will stop. That’s a legally required to be hardwired
into the machine, you simply can’t do it. How cool is that?! So now let’s talk about how different currencies
work together. I know you just rolled your eyes, I promise
it’s not as difficult as you think or as complicated as certain people want you to
believe. To start off, let’s use a made up currency,
let’s call it the Ferret. And you want to go on vacation to some lame
developing country, once you get there, you have to convert your money into the local
currency, the Turtle. Right now, one Ferret is worth… I dunno… 360 Turtles. It’s like pesos okay, it’s a really low
value currency. But, now that you have brought more value
into the country, each individual turtle is worth more. So the next person who wants to come visit
will trade their one Ferret for 357 Turtles. Then someone from here goes back and it costs
355 Turtles for 1 Ferret, which devalues the Turtle *against the* Ferret. So for the next person it takes 356 et cetera
et cetera. But this is what those financial experts on
the news mean when they say the dollar lost value against the euro today. They mean that value has transferred between
two currencies, making one more valuable or “stronger” than the other. Which is why it’s possible to lose value
against one currency, but still gain value against another. But what do they mean when they say that China
is a currency manipulator? Well now let’s take a look at the real world. As you should know, the United States has
a trade deficit with China, which means that we send money to China in exchange for goods,
but get very little back. So we are introducing more value into China. Remember what happened when we exchanged a
Ferret for a Turtle? The value of the Turtle went up against the
Ferret. So the value of the… Yoo-wan? Juan? Yuan should go up with each transaction. But… it doesn’t. China keeps the value of their currency artificially
low to encourage more trade with China. China. I’m sorry… I don’t know what it is about the way he
says it, but that’s just funny. Actually I’m not sorry, I don’t take any
of that back. Anyway, this could all be avoided if we just
had some sort of universal currency, right? There’d be no more exchange rates or confusion,
it would just be simple. There’s actually no catch here I kinda do
mean that. Prime example is the Euro. The Euro is the universal currency of an entire
continent. When I was a kid there were francs, deutschmarks…
francs again… kroners? There were a lot of currencies is what I’m
saying. But they all standardized and converted to
the Euro in 2002. That is the best practical example of a universal
currency today, and by 2023 the African continent is set to adopt their own universal currency
called the Afro. I really, really wish I was making that up,
I mean what a horrible name… what’s next, the Amero? I was… kind of kidding. But that one’s pretty unlikely because people
love themselves some dollars. Many currencies around the world, instead
of pegging their value to gold or silver, peg it to the dollar or the euro, or other
top shelf currencies, because they are relatively stable. But what about those electronic universal
currencies, like bitcoin? How does that work? Just like every other currency. Every time you buy bitcoins, you are increasing
the value of all bitcoins. When bitcoin first started in 2009, it was
basically worthless. In March 2010, someone tried to sell 10,000
BTC for $50, and nobody bought it. A month later, 1 BTC was valued at 0.003 dollars. That’s a third of a penny. Today? Each bitcoin is worth $2,669. Which means if you could go back in time and
buy that guy’s 10,000 for 50 bucks, you’d now be sitting on well over 26 million. The only real difference between bitcoin and
other currencies is that it exists digitally rather than physically. It’s worth noting that the vast majority
of “real” currencies like dollars and euros also only exist digitally but that’s
a different story for a different time. You can’t go into a bank and get bitcoin
banknotes. It only exists in the ether. So how does it work? First, you need what they call a wallet, again,
it’s electronic… basically a fancy online bank account. Then, you have to buy bitcoin from someone. You are exchanging your dollars for bitcoins,
just like you would any other currency. So now, they can go take your dollars and
spend them wherever, whereas you can really only use your bitcoins at shady online stores
and dark web services, at least for now. Every time there is a bitcoin transaction,
you are announcing to the secure bitcoin network all of the information regarding that trade. Which is then kept on several decentralized
ledgers, which are then combined to make the main ledger. I know that sounds complicated, but it’s
really not though. There’s no central authority like a government
or a bank, the people who keep these ledgers or “blockchains” are just other bitcoin
users, known as miners. Every time a user’s ledger is added to the
main ledger, that user is rewarded with 12.5 bitcoins. So… a lot of money. Which is why people volunteer their computing
power to try and mine bitcoins. I wouldn’t bother though, because of computing
power required to work the cryptography is more than most of us can afford. The cryptography is hella complicated, and
while I did take a few classes in crypto because I thought that’s what I wanted to do in
the army I… *I don’t have time to explain why*. Anyway, every time several hundred thousand
ledgers are added, the reward gets cut in half, it started at 50 bitcoins and the last
whole bitcoin reward will likely be mined in the year 2140, and there is a fixed amount
of bitcoins in existence, unlike other currencies. But just like other fiat currencies, bitcoin
only has value because people think it has value. If people didn’t want to accept bitcoins
as payment and people didn’t want to exchange their other currency for bitcoins, they would
essentially become worthless. Or, since there are no physical bitcoins,
if there happened to be a solar flare that wiped out all electronics… or the zombie
apocalypse were to occur. In that case though, dollars and euros would
probably become pretty worthless too. So what would the currency be if society collapsed? Many people might say gold and silver. Because unlike all those fake fiat currencies,
gold and silver is real money with intrinsic value. Is it though? And does it? Aside from some very recent electronic and
space flight applications, gold and silver is pretty intrinsically worthless. For well over 99% of human history, gold and
silver was only valuable for jewelry because it was shiny. It’s only valuable because it’s nice to
look at and so people think it’s valuable. Just like any other currency really. But that won’t stop people from fear mongering
you into thinking the dollar will collapse at any moment and they you should invest in
gold and silver… by buying it from them. But they won’t actually send you the gold
or silver because that would be crazy expensive and insurance blah blah, no, instead, they’ll
send you a certificate saying that they are holding onto some gold in your name. Definitely nothing shady about that, I’m
sure that gold will come in real handy when the bombs fall. Just like bottlecaps. Oh g… okay, we probably all saw this coming
so… go on. You know my main problem with bottlecaps? Bottlecaps aren’t rare enough to be a currency
and they’re way too easy to counterfeit. One of the missions in New Vegas is to shut
down a bottling facility that’s being used to counterfeit bottle caps, but is it really
counterfeiting if they’re also real bottlecaps? Not only that but bottlecaps way 2.2 grams
apiece, there are some items in the game that cost 20,000 caps, you know how much that weighs? I do because I did the math. 97 pounds! Oh yeah sure, could you just head on down
to the grocery store for me? Off you pop! Not only that but old school pre-war money
still exists in the game, and it still has value!? Why use bottlecaps?! K I’m done. Okay so really though, what would the currency
be if everything fell apart? If we’re being honest about it, bullets,
food, and knowledge. *knowledge* Take a look at the Walking Dead…
or don’t because it’s getting kind of old… and I’m just gonna tell you about
it anyway. They don’t use money. They trade in actual goods and services, smart
people are valued, guns and bullets, food… the ability to work is the main currency really. When you really boil it down, the Walking
Dead is pure communism. Everyone just keeps working in order to benefit
themselves and the group as a whole. And whenever someone acts selfishly and tries
to be a capitalist, they’re usually killed off in some horrifying way, sometimes realizing
the err of their ways in their final moments. So the next time someone tries to tell you
to invest in some precious metal because the dollar is going to collapse at any moment,
or they tell you that international trade or the value of currency is some great mathematical
mystery, at least now, you know better. So what do you think the currency in post-apocalyptia
will be? Let me know down in the comments. And don’t forget to manipulate the value
of that subscribe button… by clicking it. And in the meantime follow me on facebook
and twitter, and join the conversation on the subreddit.

Maurice Vega

100 Responses

  1. Money is a unite of exchange that comes from nothing. How can nothing, be something, of value? Money says, love me, and only me. Ask and receive having heaven in you does not need chickens or wood.  Faith is needed with ask, and receive. Faith is what Jesus wants to see. Faith is not,  my belief system, is better than your belief system. That is like a kid saying: my father, can beat up you your father. That unite of change says punish people who don't have me. Money says: ignore the pain suffering and death of animals that are used to make me. They are needed for you to make me. Think of me meditate on me. Say we have free trade lying through your teeth. I j have hypnotized the masses do they will believe your blatant bald faced lie. Money says: I want to see Satan's dividing rejecting, condemning, character in people, so they will be incinerated, in God's light, when it shines. I purposely lied about Hell, through the church, to blind people, to this. What I talk about is not socialism. Money is still used in socialism. Money divides us. Ask and receive will do  the oppooissite to that. We will need to not gather what is, unto ourselves. That is what Lucifer did, when he was cast down. That being wanted to be cast down so that being could call, what was, his, through us. The higher the price of gold and gems, the higher the ego grows, in Satan, who is covered in gold and gems. The lie of what Satan looks like, visually, makes people to not see this.Mus;lo9ims are bowing to tat destructive condemner. That is the Abomination of Desolation, that we need to get away from, when seen standing on the earth, trying to prove, that, that being, is God. God gave us all things without a price when he made what is. God will do that again. Gods mind needs to be in our mind.  Ask, and receive cannot be local. The church worships money. Money demands a sacrifice. The Catholic church who lies about what charity is Biblically 1 Corinthians 13:4 – 8 KJV. does exactly that. Children have been routinely and systematically murdered  on schedule, in church rituals. Church leaders did that, in a relaxed  manner, as if they were preparing, dinner.

  2. Disagree about the the gold and silver, it's value is in that there as of now is a limited amount of the stuff; can't print more of it. A lot of countries who go through currency collapse end up resorting back to gold currency for trade. Usually black market, but commonly used.

  3. So I have a $100. Bill that actually states it is not actual currency and was made specifically for movie purposes. Someone actually tried to pass it at my store.

  4. 6:00 …. now I wonder what happens, if I try to scan a photography of the real orion-constelation…

    12:00 … before you answer that question. I swear I haven't watched much further. I'd say small easy to handle stuff, like cigarettes, weedbags, bandages, probably bateries. And probably something akin to the Fallout series – not necessarily bottlecaps – but the basic idea of a water (or other real valuable resource like gasoline, or medicaments) backed currency.

    Edit: after I've seen the rest of the video – I still stand by my point. Agreed in a phase of turmoil directly after the desaster and the following decades until there is sufficcient infrastructure rebuild, currency most likely will be something like ammonition and workforce etc – and cigarettes, weedbags and other real valuable stuff. Canned food perhaps.

    But then – people on average don't like to live in such conditions. If enough people survive, they'll establish a new society sooner rather than later (one of the things I really find unrealistic in all of the Fallout series – it's decades after the bombs but no one, literally no one bothered to tidy up and give those shabby shacks a new coat of paint – even if there are paintcans everywhere. I mean seriously, who want's to live in a ramshackle slum if there is enough building material laying around to build propper housing? We had that long before the fifties…. Ok. Enough.)

    If such a society is established some form of standartisised currency will arise. Probably backed by – as said above, water, food, gasoline, electrical power or other real valuable things. It will be something hard to counterfit, easy to transport and store and durable. So the idea of the bottlecap isn't as outlandish as it seems on first glance.

    The game establishes, that the bottlecap is backed by water – at least in the New California / Nevada region. You can go in one of the larger settlements and get a fixed amount of water per bottlecap. And before the events of NewVegas it was assumed that there are no functional cap-presses around anymore and counterfitting bottlecaps without proper tools is pretty much impossible. (it's probably a bit gullible, as other way more complex stuff also still exists and works pretty well, but still)

    tl; dr Easy to carry around stuff like cigaretts or bullets for the direct aftermath phase; some form of valuable resource backed money after establishment of a new society.

  5. Technically speaking American currency doesn’t include a penny. A penny is 1/100th of a British pound sterling. 1/100th of an American dollar is a cent.

    Sorry… I’ll see myself out.

  6. I have to disagree with you when you said that gold and silver have no intrinsic value. Both minerals make really good, natural modicums of exchange. Sure, gold will lose its value compared to necessities like food and medical supplies in a FUBAR scenario, but it would also gain its value back faster than any fiat currency. Gold also has a proven track record of being more stable than any fiat currency, and is only outclassed by bonds when it comes to being a low-risk asset for those looking to save and retain value at relatively low risk. Its only real problem nowadays is its liquidity, but that stems from its strength of not relying on the infrastructures that most other assets used as a store of value do.

  7. golds value came from its ability to last. it wont rust, it wont decay, it just stays as is forever. that's what makes it precious.

  8. I tried the eurion constellation thing and my printer printed a bill looks pretty rilistic to almost fooled friend untill he touch it

  9. In Robert Heinlein's "Stranger In A Strange Land", the Martian, Valentine Michael Smith, goes into an orgasmic coma when he finally groks (understands) how money works….

  10. Hey, I like your videos but please do some more research on the economic implications of single currency like the Euro. Worldwide this would be a really bad idea because the role of floating currencies is absolutely necessary to balance international trade. Eliminating this is kind of one of the fundamental problems of the euro by impoverishing the southern nations

  11. My father buys and owns land. Land is worth alot of money and will always maintain its value. The value may drop or rise, but it is relatively stable.

  12. Should be noted that real currency is relatively stable and desirable because you can only pay your taxes in currency. You can't pay taxes in Bitcoin or gold. So there is some intrinsic value to the dollar, and that intrinsic value is tied to the government's ability to collect those taxes.

  13. If society / the economy where to fall apart the currency would be natural resources such as wood, seeds, water, food, and metals(Iron and Bronze for example).

  14. It might be "illegal" to make fake money, but nearly every movie studio does it anyway. Usually it's printed in such a way that it's obviously fake

  15. In Finland, we never use the 1c and 2c coins. The lowest denomination we have here is the 5c coin – any 1c and 2c stuff seems to be brought in from other Eurozone countries. They're legal tender but we don't use them ourselves.

  16. Depending in the type of apokalypse, the currency would be whatever is rare and/or seen as valueable. Maybe seeds, maybe tools, maybe water.

  17. The copper coated zinc pennies from 1982 onwards are only worth about .6 cents melted down, it is just the copper pennies from 1982 and before (the years overlap) which are 1.6 cents melted down.

  18. People don't buy gold and other precious metals for a SHTF situation (unless they're stupid)…..they buy them as a "hedge" against inflation.

  19. Actually there is a downside to a shared currency. Struggling economies can't devalue their currency anymore to gain competetiveness. Check out what's been going on in greece

  20. actually gold is valuable because it doesnt degrade over time, it doesnt rust or anything like that. so it can be safely stored over long periods of time, combined with how "rare" or hard to get in any quantity. this is why it has value as a currency.

  21. Hey, thanks Teach! You're like the real life Mrs. Frittz.

    I fuckin WISHED you were my Social Studies teacher back in the mid 2000's.

  22. Silver also has slight anti microbial properties, so during medieval times they thought it was good to eat off of because people got less sick.

  23. I received a 20 dollar bill that said "not real currency , meant for filming" and under andrew jacksons face it said "not jackson"

  24. Money doesn’t have to be real for movies. There’s a guy certified by the government to make fake money, and he rents it to movies and music videos

  25. Good apocalypse currencies include: Bottlecaps, water, medicine, and a good one from before refrigeration, salt. Salt used to be worth it's weight in gold, and if everything goes to shit, you're gonna want a lot of salt.

  26. i disagree with the statement about Gold having no value. Every academic knows that the value of Gold is designated due to its rarity along with phenomenal properties of having high resistance to corrosion along with its high ductility and malleability.

  27. Aight I know this video is old but there's a reason behind the use of bottle caps in fallout one and two. People traded in clean water shipped in glass bottles. These same traders would accept the bottle caps back in exchange for goods and services, because they could easily find more glass bottles but not the caps. Soon, everyone was doing it. This was exclusively tied to the specifics of the western wastelands in California. Once the NCR popped up, they started producing new paper fiat currency, and bottle caps were devalued. I can't remember the exact event, but something made the NCR dollar be devalued between two and new Vegas, thus causing bottle caps to return.

    There is no reason given for any Bethesda developed fallout game for the use of bottle caps, and those all take place on the east coast. (This lazy lore building is kinda a trend in Bethesda make fallout games, but that's irrelevant)

  28. I was about to comment re my take on post-SHTF currency, and you beat me to it. xD

    Yep: Ammo. Or, failing that, anything that can be turned into ammo; brass, copper, and lead come to mind, as do the basic ingredients for gunpowder, smokeless or (more likely) otherwise. And hell, anyone with the capacity to manufacture primers would … uh … would be well advised to find themselves an army any way they could, because /everyone/ would want a piece of that action, any way they could get it.

    Not a turn of events to anticipate with anything like pleasure.

  29. FAIL – Pound sterling, US gold & silver certificates were never backed by 100% metal, and more typically ~20%. The government can and did print more gold certificates (for example) without increasing the backing reserve. Presenting errors as if they were reality makes you look foolish.

  30. This is somewhat incorrect. The detection isn't hard wired into (at least most) scanners. Money scans just fine. You just need to use some open source scanner drivers.

  31. Little late to the party but… You Can buy prop money like they use in the movies. Just look it up online for example at prop

  32. One more thing: On every US Federal Reserve note (money) is printed "This note is legal tender for all debts public and private" – That means to pay taxes, court settlements or anything to do with the US government only dollars will be used for settlement. All public employees are paid in dollars. This gives these pieces of paper a lot of clout.

  33. Man i'm really late to this video, but i disagree the way you put dollar and gold/silver almost at the same level. You can't produce gold/silver out of thin air like governement can. The alquemist tried to produce gold and silver out of other metals, but it's kind of proved it's extreamy unlikely. So the short answer is: In a collapsed society gold/silver would come back, because it's limited natural amount doesn't depend on trust on some institution.

  34. If society collapsed the currency would be to trade for good/services or if people have formed some kind of settlement they will have their own currency and will trade with other groups around them

  35. i think your videos would be better if you kept the jokes to a minimum……you just aren't very good at it and all it does is interrupt focus and they are so lame it is irritating. smarten up.

  36. thankyou for pointing out that there is no reason that gold or silver should have any intrinsic value to them at all and they only have value because people THINK they have value. fiat currencies are exactly the same…..they have value because enough people think they have value…..actually their value is more legit because it is based upon the stability and economic ability of a country/countries…which is better reason to allocate wealth than whoever holds the most amounts of a shiny rock.

  37. Holding physical gold and silver is not a bad idea. Look at charts of their value spikes during every recession of the last 50 years. It's just insurance against high inflation like we saw in 2011 and to help soften losses in the stock market during crashes. Also silver is in almost every electronic you use today so their is some industrial value there.

  38. Ferrets. Ferrets are going to be the currency in the post-apocalyptic USA. Send me your money and I will send you a certificate for how many ferrets it is worth. You not only get the ferrets but you don't have to feed, clean up after and house real ferrets. Just keep that certificate if the value of our currency collapses.

  39. A post apocalypse society would definitely become a dictatorship or patriarchy. One group will be able to take over another group and steal the resources. Then they will threaten a different group to give them tribute or else suffer defeat thus ensuring their own survival. UP YOURS!!

  40. As you know, in iran most everything bought and sold, well not everything, is done with Green Dollars. I had 140+ mohammidan translators and they were paid $600 a month in GREEN.

  41. I believe you are incorrect in saying that money seen in movies has to be real. I'm fairly certain their are companies that make prop money for movies/rap videos but obviously they must clearly not be passable as real money and would be a huge crime to try and do so.

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