Money

Without money, humans would revert to carrying out transactions through the system of barter trade where goods and services are directly exchanged. In global economy where the market is composed of many goods and services, the absence of money as the measure of value would results to exchange of products directly without considering their real worth. The absence of money means that a person wishing to buy or sell the goods and services or property would have to find another person who thinks that an exchange with what is being offered leads to fair trade.  A major advantage associated with money is that it increases the speed of conducting business and thus, reduces losses related to delay (Beattie, 2015). Also, if a person needs something within short-time and they keep trading for it, they would not always be given a good deal unlike using money where the prices are set. The changing if the terms of the exchange would also be necessary so as to have the other person agree to the terms. Thus, products that are valuable are likely to be exchange with those lower value, hence a lack of trade balance.

 High inflation makes the currency of a country to significantly lose value in that very few goods can be bought by a large sum of money.  Also, the inflation makes the prices of basic goods and services to increase to levels that are unaffordable to the population.  The currency loss of value negatively affects the exchange rates so that it becomes unsafe to hold cash in it (Kennon, 2018).  The option is to shift to a currency of another country which is more desirable in terms of holding the cash asset.

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