Paper money does not have intrinsic value

Paper money has no intrinsic value. The word “Intrinsic” means: something that belongs to the essential nature or constitution of something else. The ‘intrinsic brightness of a star’ is a common definitive statement.  Synonyms of the word include: built-in, constitutional, hardwired, immanent, indigenous, integral, inherent, natural, etc.

“Society” is intrinsic to economics

The Bank is an important institution for vetting social value. Despite the observation where it seems money is created out of thin air, traditionally a bank looks into a community of people and their talents to identify “social value”.  This is the likelihood that a person or group of persons can execute a specific economic outcome in the community.  Then the bank provides them with a tool called money to represent and facilitate future productivity in the present time.  So it is not really “thin-air” – it is simply invisible social value.

Little Bank on the Prairie

In the old days, the banker was a member of the community and could judge social value on any number of intrinsic social characteristics such as social status, leadership, family values, education, personal habits, and community participation. Later, the credit score became a proxy for social value through the analysis of public data (where “public” became the proxy for “social”). The credit score was then assumed to convert social value directly into financial value.

The terms “proxy” and “intrinsic” are not the same thing.

“Brightness” is not a proxy for stars any more than “stars” are a proxy for brightness.  Yet, the distinction between intrinsic banking and proxy banking remains indistinct. An Intrinsic bank would be characterized where social value is intrinsic to the creation of financial value.

It’s all about Value

We created The Value Game as a new class of business methods to transform financial value back into social value – The Value Game performs the mirror-image effect in an economy as the credit score.  The value game increases the social value of the community enterprise by converting monetary value into social value.  Only then can the Credit Score sustainably convert social value back into financial value.

Who wants to become a Trillionaire?

The point of this discussion is not to slam banking, rather, it is to demonstrate that intrinsic banking does not formally exist – yet is must exist as a direct balance to traditional banking.  As such, intrinsic banking is at least as “Valuable” as the banking industry itself. Today we are entering an age where society MUST come up with a NEW way to store and exchange VALUE. Whoever really get’s this and pioneers Intrinsic Banking today (what it means, what it creates, and why) will become as mega-wealthy as traditional bankers, in the future.