A gold bar has value as does a copper bar, but physical stuff isn’t money.

The idea of money as debt is really around taxes. You need to pay your taxes in money issued by the country you live in. Let’s take a New Country (NC) with a Government called NCG with a currency called Token.

At the start of the year NCG created some Tokens and at the end of the year citizens of NC need to have Tokens to pay taxes with, but why would the NCG accept stuff it just created from thin air as having value? And the answer is before people pay taxes NCG can buy stuff using Tokens by saying people are going to want to eventually pay taxes with these so they aren’t just pieces of paper they are IOU’s Aka Money. So at the end of the year when people are paying the government of NCG formerly imaginary Tokens what they are essentially doing is cashing in IOU’s from the NCG.

Of course the idea of these Tokens having value takes on a life of it’s own, much like how Bitcoins can be perceived as valuable when they don’t actually do anything. But if a country fails it’s currency quickly becomes worthless.

Taxes solve the buy-in and the problem of getting everyone to collectively agree on which money to standardize on, but fundamentally any token which the issuer agrees to accept in exchange for a debt is "money".

Forget about NCG. Suppose you move somewhere without any government. Heinlein ran through this example as a thought experiment in _Time Enough for Love_. You open up a general store. Nobody has any money to pay you, so whenever someone wants to buy something, they have to trade something. You can't set prices because there's no currency unit (numeraire) to set prices in. So what you do is you offer to let people buy things on credit, knowing that they will later have stuff to trade you to satisfy the debt. All this requires is a book to track debts. That leaves you having to haggle at time of repayment what that thing in the past they bought was worth, in terms of what they have to trade for it now.

So, you as the owner print up "notes" and give them out to people, typically for larger projects, with contractual promise of repayment later. These can be called loans. They don't have to be for projects, though. You could give everyone some "notes" every month and keep track in a ledger that they owe you that back with interest, or maybe no interest if you think people using your notes will give you an advantage over your competition, the general store in the next valley over that everyone is sick of bartering with. Whatever the reason for handing out these "notes", you can then set all your prices in terms of the numeraire on these "notes" you hand out, so the person you loaned money to can buy stuff from you. The people you loan to can also buy stuff from other people using these "notes" as long as those other people also want to buy stuff from your general store.

Maybe the loanee starts up a farm with the loan. As the farm produces food, they sell the food to other people, and maybe they accept the "notes" back as payment for the food. The loanee can use the "notes" they received from the food they sold to pay back their debt to your general store. With interest, of course.

Trying to balance money supply with economic activity — and only the activity of people willing to use that type of money — is a challenge in such a small economy like that, with privately-issued currency. However, no taxes are necessary.

The real world example is more illustrative: https://en.wikipedia.org/wiki/Company_scrip

Essentially the company pays it’s employee an IOU Token that can be redeemed at the company store or for housing etc. In this case it’s the willingness to trade goods for these tokens that give them value rather than Taxes, but it’s the same deal. After the value has been established people are willing to take out loans in script etc. But just like your example the company doesn’t inherently value having script just maintaining the illusion that script is worth something.

There are two problems with your definition:

1. The definition differs significantly from what people usually call money. Gold bar is a gold bar, not money.

2. It makes anything money. I can barter a basket of apples to a fish -> apples are money. That makes it difficult to create useful and interesting observations about the thing we usually call money.

You're exactly right, but that's kinda my point.

I think my definition is quite fundamental, and holds true all the way back to the beginnings of finance. We used to just trade directly - trading horses for maize, etc.

But then humans realized that having anything be money is inefficient, so we invented currency as a locally acceptable surrogate for whatever humans value. But it's still rooted in humans exchanging goods and services they find valuable, for whatever reasons.

Wealth. Money is a form of wealth. So are any apples, gold, property or other possessions. But the term is wealth.

I tend agree with you. I have a personal definition that allow me to derive a lot of properties with simple game theory, and explain why a gold bar is great money: money is a "desire" accumulator.

Oh that sounds interesting, I like the idea of money as a desire accumulator. That makes intuitive sense to me. Could you please expand on the implications of this perspective?

I struggle to put it in a succint way without misrepresenting what I think. I will probably write a small blog post about it (Please send me an email, I would love your opinion on it when I do ! contact info in profile).

A way to look at the problem, is to realize that what matters is the ability to make humans do something. ( I won't expand on why that matters). From there, the other observation is you can probably reduce the reasons humans act to a few affections like fear... desire ( and a couple of others).

I am not trying to explain why we should decompose things this way nor prove anything, just doing a quick exposition. Think of those affections as analoguous to physics fundamental forces.

Having said that, here is a couple of interesting things. Those primal affections work often together but are not the same. They differ in the kind of social relationships they establish between humans.

Crucially in that framework, debt is not money. It can be used to bootstrap money, but it does not establish the same relationship.

When I say money is a desire accumulator it means that having acquired it, I can rest assured that people will desire my money, and will do things out of their own "free will" to take it from me. That gives me leverage (The sentiment of free will is important for it to work, and correlates with the desire emotion).

The accumulator part is important because it allows to build an economy of desire, to transfer it over time , space and to mix it with other fundamental forces to great effects.

I am not sure what I wrote makes sense without a lot of background presentation but feel free to probe it !

Your money is someone else's debt. It's more correct to say money is credit.