Georg Simmel: Money Stands Still
on Wednesday, March 30, 2022Georg Simmel Money Quote saying that if money is not moving, it doesn’t serve the purpose it was intended to serve. Georg Simmel said:
“When money stands still, it is no longer money according to its specific value and significance” — Georg Simmel
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In this quote, Georg Simmel is making an observation about the nature and function of money. The best interpretation is:
- Simmel states that money loses its defining “value and significance” when it ceases circulating and instead sits idle or “stands still”.
- Money derives its worth and purpose from its ability to act as a fluid medium of exchange. Its value is in its movement between economic actors.
- If money is hoarded and not used to facilitate trade and the exchange of goods/services, it is no longer truly fulfilling its role as a currency according to Simmel.
Overall, Simmel appears to be suggesting that money’s essential characteristic is its liquidity and circulation within an economy. Immobilized funds are no longer effectively serving their role as a dynamic medium of exchange – they are just inert assets. Money must flow to maintain its monetary qualities from Simmel’s perspective.
Birthday: March 1, 1858 – Death: September 26, 1918