The Untold Truth About Money – How Does Money Work?

Money is such a thing that everyone from beggar to billionaire wants to get it.

It is not just a piece of paper
but it is an addiction in itself.

Money is such a language that everyone
knows from PhD clerk to illiterate MLA.

It is only money,

that has made the people living in the
forests sit in these cloud-touching buildings

to vehicles that run faster than the wind.

Money is a piece of paper
which has no value in itself

But it tells you the value of other things.

Now the question is,
from where did money get so much power?

Let’s understand in a little detail.

Thousands of years ago, humans used
the barter system for transactions.

Where to buy one thing
you had to give something else.

That is, if someone has rice and needs sugar,

then he has to find a person who wants to
sell sugar and at the same time needs rice.

Due to many such problems, people thought
something different and started commodity.

People made money out of everything
that was useful to everyone.

And people started doing business
through cattle, grain, tobacco and liquor.

But there was a problem with this too,

it was very difficult to find out what is
the true value of what I have?

And the commodity used to
get spoiled with time.

The animals bought used to
die and the grains used to rot.

Now man needed something
which was universal.

And the coins made of gold and silver started.

But this two-legged creature
had a problem with this too.

Along with carrying heavy gold,
there was also the fear of theft.

So some goldsmiths and other
people together found a solution.

He said to the people, “You keep your gold with us, we will keep it safe.”

In return, that goldsmiths would have
given a piece of paper,

In which it was written
“I have kept this much of your gold.”

Which was called IOU.

Meaning I owe you.

By showing which people
could take their gold back anytime.

Everyone liked this idea very much and
people started keeping their gold with them.

But then after some time,
the goldsmiths realized that

after making this system almost
no one came back to take their gold.

And everyone started doing business
only through that receipt.

Because everyone was convinced “There is a receipt, it means there must be gold too”.

Now after understanding this,
the goldsmiths got greedy.

Now the receipt made by
their hands had become money.

That’s why they started making fake receipts.

They didn’t even have gold with them.
But still, they used to make more receipts.

This is how the world’s biggest legal
scam started which is still going on.

That gold safekeeping shop
was the world’s first bank,

and that receipt was
the world’s first currency means note.

If I ask you how a bank works.

Then you will say that with the money we deposit in the bank, the bank gives loans to others.

And by charging some interest
on it the bank earns profit.


Now according to this explanation, the bank
operation would be something like this.

Like yesterday morning you went to
the bank to deposit 1000 rupees.

You deposited two 500 notes in the bank.

What will the bank do after that?

They will keep a 10% cash reserve as per the rule.

And will give the remaining 900 rupees
on loan to someone else.

And if this bank charges 12% interest
annually from the person with the loan.

And gives you 4% interest per annum.

So the remaining 8% became their profit.


All the commercial banks of the world
operate on the same basic principle.

But banks don’t just make money like that.

There is a big game behind it
which most of the people do not know.

And that game is this.

That bank can easily make your
deposit of 1000 rupees to 10,000 rupees,

and can do business with it.

And how does that happen, let’s understand.

Suppose you go to the bank
and deposit 1000 rupees.

The bank will keep 10% cash reserve as per the rule,

and will give the remaining
Rs 900 on loan to someone.

But watch carefully what happened here.

If you check your balance after depositing your money, you will be shown the same 1000 rupees.

And here the person who had applied for
the loan and the bank gave him the loan,

If he also checks his balance,
he will also see Rs 900.

This means both of you have purchasing
power of Rs 1000 and Rs 900 in your hands.

Whereas in reality that bank
has only 1000 rupees in cash.

Means, that bank just by typing
some numbers on its computer,

created currency of
an extra 900 rupees in the market.

Which is of course virtual
because there is no cash to back it.

And this game does not end here,
it goes much further.

Like the person who applied
for a loan of Rs.900.

He would not have applied
for the loan without any reason.

He must have needed
those 900 rupees to buy something.

And when he spends the money,

this money will simply be transferred from his account and deposited in someone else’s account.

And the bank will again
reserve 10% of this Rs 900

and again lend the remaining
Rs 810 to someone else.

In doing so, a bank simply
does business by converting,

cash deposits of Rs 1,000 into
virtual currency up to Rs 10,000.

You think your money is safe in the bank
which you can withdraw whenever you want.

But this is not true at all.

If only 20 to 30% of people
go to withdraw money together,

then the bank will not be able to
return your entire money to you.

Because they don’t have all your money.

Because of the fractional reserve system,
it operates only on probabilities.

For example, if you add up the bank balance of all the bank accounts in the world and it is Rs 100,

then less than Rs 10 is available in real cash.

More than 90% of the rest is just virtual digit.

Which only you can see
on your mobile or computer screen.

Boss, this illusion of money has been
deliberately made complicated.

So that the common man cannot understand
it easily and remains trapped in this system.

People think that currency
and money are the same thing.

But it is not so.

Currency is a medium of exchange,
while money itself is a valuable asset.

Bundles of 1000 notes lying in your house will turn into paper overnight if the government rejects them.

Because it is currency.

But the value of the gold coin lying in
your house will remain the same as it is.

No matter what any
government of the world may say.

Look boss, whatever other
influencers say to you,

that buy gold bonds,
take digital gold, do this, do that,

otherwise, you will be taxed on this and that.

I would say buy real gold too.

Because some decisions
of life are not taken on the basis of tax.

Now where do you have 500 – 1000 crores
that you have to worry about 2-4% tax.

And the truth is that only real goods are
useful at the time of the pandemic.

You cannot buy a ration for the whole year by showing your gold bond certificate to someone.

But with a small amount of gold lying at
home, one can manage for the whole year.

This paper is only about trust
and the world is stable on trust only.