Everyone was curious about the origins of money and how it flows through our economy. Did you know that a government facility in Washington, DC, converts paper into cash every hour of the day in order to meet demand? But there’s a catch: most of the money exists digitally.
See the video below to learn more about how banks magically create money.
Vocabulary Questions:
- Explain “type into existence“. “Before it ever reached your bank account, it changed hands countless times, passing through people, governments and businesses all after being simply type into existence.” Create a sentence using this term.
- What does “hard to come by” mean? “To make transactions easier, people started to pay using more commonly used items like cattle, grain and salt. Everyone needed these things, but they were hard to come by and that’s what made them valuable.” Use this idiom to make your own sentence.
- What is the meaning of “intrinsic value“? “The paper itself has no intrinsic value but it became as good as gold.” Give two (2) synonyms or similar expressions and use ‘turn back the clock’ in your own sentence.
Discussion Questions:
- How does money work and evolve?
- When did the entire idea of money started to change?
- What’s the bank role in money processing?
- What does “new money” mean?
- How do banks actually generate revenue?
- What are “bonds,” and what role do they play in the banking system?