How would the economy look differently if money was only an exchange medium and not a store of value, or vice versa?
In: Economics
Currency is an exchange medium. Everyone in the transaction believes it has value, and the people exchanging goods or services agree on the value of the currency vs the value of the good or service.
A store of value is more or less something that people agree has value, but can’t be classified as a good or service. This would be stocks, property, trade goods that you do or don’t hold (like trading metals on the open goods market, or investing in futures markets).
The major difference between them is that their values can change independently from each other.
Alternatively, they are similar in that they can even become [near] worthless in the case of hyper inflation, or the housing market crash in 2008.
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