The essence of money as an economic category is manifested in its functions, which reflect the internal content of money. Functions of money Measure of value Medium of circulation Medium of payment Means of accumulation and savings World money 2

Money as a universal equivalent measures the value of all goods. However, not money, but socially necessary labor, spent on the production of goods, creates conditions for their commensurability. Real money (silver and gold), which has value, can become a measure of the value of goods. In this case, measuring the value of goods in money occurs ideally, i.e. the owner of the goods does not necessarily have to have cash. The cost of a product expressed in money is called price. The price is determined by the socially necessary labor costs for the production and sale of goods. 3

The basis of prices and their movement is the Law of Value. Its essence lies in the fact that the commodity producer is forced to constantly ensure that his costs for the production of goods do not exceed the social cost. necessary costs. The price of a product is formed on the market, and if supply and demand for goods are equal, it depends on the cost of the product and the value of money. 4

Functioning real money: 1. The price of goods is directly proportional to the value of these goods and inversely proportional to the value of money; 2. The value of money-gold was relatively constant. Due to the discrepancy between supply and demand in the market, the price of a product inevitably deviates from its value. Based on such deviations of prices (up and down) from the cost of the commodity producer, it is determined which goods are not produced enough and which are produced in excess. Paper money and banknote systems: Prices of goods are expressed in terms of values ​​that do not have their own value, so they cannot accurately reflect the value of goods. This results in differences in prices for the same product, which makes it difficult for the producer to accept the correct rational decisions about the production of goods. 5

Quantitative assessment of the value of a commodity in money, i.e. the price of a commodity, provides the possibility of measuring not only the products of social labor, but also part of the same monetary commodity - silver or gold. To compare the prices of goods of different values, it is necessary to reduce them to the same scale, that is, express them in the same monetary units. The scale of prices in metal circulation is the weight of the monetary metal accepted in a given country as a monetary unit and serves to measure the prices of all other goods. 6

Between money as a measure of value and money as a price scale there are significant differences. Money as a measure of value relates to all other goods, arises spontaneously, and changes depending on the amount of social labor spent on the production of a money commodity. Money as a price scale is set by the state and acts as a fixed weight amount of metal that changes with the value of this metal. Initially, the weight content of the monetary unit coincided with the scale of prices, which was reflected in the names of some monetary units. Thus, the English pound sterling in the past actually weighed a pound of silver. During historical development the scale of prices became isolated from the weight content of the monetary unit. 7

With the establishment of the dominance of fiat credit money, the scale of prices underwent significant changes. The state establishes: a) the name of the monetary unit, the procedure for its issue and withdrawal, as well as its denomination; b) the procedure for issuing a smaller monetary unit, made, as a rule, from cheap metals, determining its ratio to the main monetary unit; c) rules for the circulation of cash and non-cash money; d) the exchange rate of the national currency to foreign ones, based on the demand for its currency, and publishes it in the official press. 8

In contrast to the first function, where goods are ideally valued in money before their circulation begins, money must be present in reality during the circulation of goods. Commodity circulation sale of goods purchase of goods 9

Money remains constantly in the exchange and continuously serves it, which creates conditions for the commodity producer to overcome the individual, time and spatial boundaries that are characteristic of the direct exchange of goods for goods. This means that money contributes to the development of commodity exchange. Commodity circulation involves two independent acts: buying a product and selling it, separated in time and space. This creates an objective possibility of disruption of exchange and, ultimately, a crisis situation, thus intensifying the contradictions of the exchange process. (In direct exchange of goods (goods for goods), purchase and sale coincided and there was no gap between them). 10

In this regard, the function of a medium of circulation can be performed by inferior money - paper and credit. Currently, credit money has taken a dominant position, acting as a means of purchase and payment. Despite the fact that credit money arose from the function of money as a means of payment, now it serves primarily the circulation of capital. Credit money, therefore, acts both as a means of circulation and as a means of payment, and therefore in foreign economic science the functions of money as a medium of circulation and as a means of payment are combined into one. 12

Money, being a universal equivalent, that is, ensuring its owner receives any good, becomes the universal embodiment of social wealth. Therefore, people have a desire to accumulate and save them. In this case, money is removed from circulation, i.e. the act of sale and purchase is interrupted. However, simply accumulating and saving money does not bring additional income to the owner. 13

Difference from the previous two functions: money as a means of accumulation and savings must have the ability to retain value for at least a certain period; the money must be real. 14

However, it is not profitable for an entrepreneur to keep money in the form of “dead treasure”, which is typical for simple commodity production, so they put it into circulation to make a profit. In addition, the accumulation of temporarily free funds - necessary condition circulation of capital. It is the creation of cash reserves at an enterprise that ensures the smoothing out of emerging violations in an individual economic entity, and reserves on a national scale ensure that imbalances in the national economy are smoothed out. 15

Currently, the purpose of the gold reserve as a means to replenish internal circulation, exchange symbols of value for gold, and international payments has disappeared due to the withdrawal of gold from circulation. However, gold continues to play the role of a treasure, concentrating in the reserves of central banks, state treasuries, and government monetary authorities. The size of the gold reserve indicates the wealth of the country and ensures the confidence of residents and foreigners in the national currency. 16

Individuals also accumulate gold in the form of bars, coins, jewelry (gold hoarding), buying it on the market in exchange for their national currency. The purpose of such accumulation in the conditions of the dominance of signs of value is to protect oneself from depreciation. The majority of members of society, in the absence of gold circulation, accumulate and save credit money, which is paper symbols and does not create real wealth for the owners. Business entities concentrate short-term capital in credit institutions, and long-term capital through securities, while receiving income. 17

Today important This function - to spontaneously regulate monetary circulation under the dominance of signs of value - has been lost, since now credit money cannot elastically expand or reduce the amount of money necessary for circulation, as was the case with gold money. 18

Goods are not always sold for cash, due to the unequal length of periods of production and circulation of various goods, as well as the seasonal nature of the production and sale of some goods, which creates shortages additional funds at the business entity. As a consequence of this, the need arises for the purchase and sale of goods with payment in installments, i.e. on credit. 19

The emergence of world money was caused by the emergence of foreign trade relations, international loans, the provision of services to an external partner, etc. Today, world money functions as a universal means of payment, a universal means of purchasing and a universal materialization of social wealth. 20

International means of payment: act in settlements on international balances: if payments of a given country for a certain period exceed its cash receipts from other countries, then money represents a means of payment. International means of purchase: serve when there is an imbalance in the exchange of goods and services between countries, in which case they are paid for in cash. As a universal embodiment of public wealth, they are used when one country provides loans or subsidies to another, or when paying reparations to a victorious country from a defeated one. In this case, part of the wealth of one state is transferred to another through money. 21

Money- a product of the historical development of exchange, namely, in the process of improving the conditions of the exchange process, a commodity was allocated as an equivalent as money. The development of exchange occurred through a change in the following forms of value:

Simple or random - one product (relative form of value - active role) expressed its value in another product opposing it (equivalent form - passive role).

Full or expanded - each product, which is in the relative form of value, is opposed to a multitude of equivalent goods.

The general form of value is the separation of individual goods from the commodity world, which play the role of the main objects of exchange in local markets. Feature: the role of universal equivalent is not assigned to one more product, but in different time it is performed alternately by various products.

The monetary form of value is the allocation of one product to the role of a universal equivalent. This role assigned to the noble metals - gold and silver, due to their natural properties: qualitative homogeneity, quantitative divisibility, preservation and portability.

The essence of money.

Money is a specific commodity form, with the natural form of which the social function of a universal equivalent is fused. The essence of money is expressed in the unity of three properties: universal exchangeability, exchange value, materialization of universal labor time.

Need for money directly related to the functions they perform:

Measure of value. This function is performed by money, which has an internal value, as mentally represented. The form of manifestation of value is the price of the product. The value of a commodity serves to transform exchange relations into opportunity. quantitative estimates with the help of money. Money is a means to which other goods are equated, not only as products of human labor, but also as parts of the same monetary material - gold and silver. As a result, goods began to relate to each other in a constant proportion, that is, a price scale arose as a certain weight of gold or silver, fixed as a unit of measurement. The price scale determines the purchasing power of money: the higher the price scale, the higher the purchasing power. There are real (the gold content of a coin corresponds to its weight) and fictitious (inferior money) price scales. The Jamaican monetary system (1976 - 78) abolished the official price of gold and gold parities, and therefore the official price scale lost its meaning. Now the official price scale has been replaced by the actual one, which develops spontaneously in the process of market exchange.

Medium of exchange. Money here plays the role of an intermediary in the exchange of two goods: C-D-T. In this case, the participants in the transaction do not care what they transfer to each other: full value or a sign of value. There are goods and money in circulation, but the commodity is primary. Goods go out of circulation after a transaction is completed, and money remains in this area, continuously servicing the exchange of goods. The product determines the amount of money needed for circulation: (? prices of goods sold / velocity of circulation of the monetary unit).

Treasure Education Tool. Since money represents the universal embodiment of wealth, there is a desire to accumulate it. The incentive to accumulate money is its purchasing power. Money is at rest and out of circulation. However, there are following forms savings: deposits in banks, in securities, to other credit institutions, the balance of money on hand (the first three are an organized form of savings, the last is unorganized).

Instrument of payment. It arose in connection with the development of credit relations in which the sale of goods is carried out with deferred payment. In this case, the function of a medium of exchange is performed not by money, but by debt obligations. At the time of repayment of a debt obligation, money performs the function of payment. That. the amount of money required for circulation: (? prices of goods sold -? prices of goods sold on credit +? payments on obligations -? mutually extinguishing payments)/average number of turnovers of money as a means of circulation and payment. Now the border between the function of money as a means of circulation and payment is practically absent.

World money. They have a threefold purpose and serve as: a universal means of payment, a universal means of purchasing and the materialization of public wealth. Money acts as an international means of payment (according to balances of payments). As part of balance of payments calculations, reserve currencies ($,&,Y, DM, FF, SwF) are used. IMF member countries calculate SDR (no more than 2% of payment turnover). Euro (ECU) is the international currency of the EEC.

20% of gold and 20% of foreign exchange reserves were pooled for the issuance of ECU by EMU member countries.

Thus, money arising from the resolution of product contradictions is not technical means appeals, but reflect deep public relations. In its evolution, money appears in the form of metal, paper, credit and electronic money.

Acting as a necessary equivalent of commodity production, an active component of all economic processes in national and world economies, money is a very complex, multifaceted and constantly developing socio-economic phenomenon. In this regard, the interpretation of their essence within different economic schools varies significantly, and, accordingly, there is no generally accepted definition of money.

Based on the analysis of the historical evolution of the forms of money, we can give a definition: money is the most liquid generally recognized financial asset, which is specific form social wealth that can be exchanged for any goods and services. However this definition does not reveal all facets of the essence of money as the most important category with the necessary completeness.

In modern economic literature There are two most common approaches to characterizing money. One approach is based on the thesis that the functions of money determine its essence. At the same time, money is usually characterized as a means of payment for goods and services (medium of exchange), a unit of account (measure of value) and a means of storing (accumulating) value, and the primary and main function of the medium of exchange is recognized. In accordance with this approach, money is any financial asset or even an item that can be used as money, i.e. will be accepted by any economic entities in exchange for goods and services. From these positions, money is most often viewed as a technical instrument of exchange.

Within another approach, money is treated as a special kind of commodity, serving as a form of value for all goods and services. They represent the general equivalent of goods, i.e. isolated form of exchange value, and are used to determine exchange proportions in exchange. Functions do not define the essence of money, but are a form of its manifestation and follow from the essence. From the standpoint of this approach, money is considered as a historical category of commodity production, a historically determined form economic relations between people. With the help of money, relationships are established between participants in the market economy - independent commodity producers who, without being directly related to each other, enter into relationships through exchange. .

Money is a special commodity that serves as a universal equivalent, that is, expressing the value of all other goods. They arose at a certain stage of development of society. Their emergence is associated with exchange.

Money is an absolutely liquid medium of exchange, i.e. a product that has the greatest marketability. A liquid product means a product that is easily sold. Money is one of the most significant components in economic life society

Money appeared thousands of years ago and has long been the subject of study, first by ancient thinkers, and then by economic science as an independent field of knowledge. However, a generally accepted theory of money has not yet been developed. There are significant disagreements among economists on the main issues of monetary theory, such as the causes of money, the essence of money as economic phenomenon, the composition and content of the functions they perform, their role in social reproduction. Table 1 discusses some concepts of the origin of money.

Table 1

THEORIES OF THE ORIGIN OF MONEY

Theory of invention	Money came as a result creative concept ancient legislators (founder - German archaeologist August Beck, 1838.
Agreement theory	Money appeared as a result of a tacit agreement between people regarding the performance of certain objects as money (the founder was the English philosopher and economist John Locke, 1690-1691).
Evolutionary theory	According to this interpretation, money did not appear overnight, by force of law or agreement, but as a result of the long evolution of exchange relations. They are an objective result of the development of the process of commodity exchange, which in itself, regardless of the desires of people, gradually led to the spontaneous separation of a specific product from the general mass of goods, which began to perform monetary functions. Money is a product of natural historical and cultural evolution (founder - German economist K. Marx, 1867, “Capital”). This is the dominant view in modern science
Hartal theory	Money is the creation of the legal system (founder - German economist G. Knapp, 1905). It is the declaration of money as legal tender that creates demand for it as an instrument of circulation and makes it a measure of value.

Despite the differences in interpretations of the economic content and origin of money, all economists agree that its essence is revealed in the functions it performs.

The functions of money characterize their individual specific essential properties and express the purpose of money. Due to the lack of a generally accepted interpretation of the essence of money, the subject of debate in economic science is still both the number of functions of money and their content.

Traditionally, the functions of money include the ability to measure the value of goods, service their circulation, make payments on obligations, and implement the accumulation of wealth. The following functions of money are distinguished (Table 2)

Functions of money

	Characteristic
Medium of exchange	The inconveniences of direct exchange of goods led to the practice of exchanging items produced on the farm for those that are in general demand. Their possession made it possible to purchase goods needed by the economy. In the role of such objects, money performs the function of a medium of exchange. An item that performs this function does not necessarily have to be an item of industrial or personal consumption. What is important is the confidence of the person accepting in exchange for his goods that other persons will also accept this item in exchange for goods that he needs, i.e. The custom of using an item as money is important. Assigning the status of legal tender to an item, i.e. an item that is required to be accepted in all payments by law is not a prerequisite for its functioning as a medium of exchange
Measure of value	Money as a measure of value is the equating of a product to a certain amount of money, which is a quantitative expression of its value. The value of a product, expressed in money, is its price. A measure of value is a monetary unit used to measure and compare the cost of goods and services. The cost measure function is implemented based on the price scale
Store of value	Any household has a need to put aside personal consumption items in reserve. Since not all items have the property of being preserved, the practice arose of making stocks in the form of items that have this property, and then exchanging them for goods needed by the household. It is clear that such objects should perform the function of a means of circulation
Instrument of payment	Items are not always sold for cash. Sometimes they are sold on credit. The discrepancy in the timing of purchases and sales gives rise to the function of money as a means of payment. If a product is sold on credit, the medium of exchange is not the money itself, but debt obligations expressed in money, such as bills of exchange. However, upon expiration of the loan term, the buyer, who is also a debtor, is obliged to pay the seller-creditor the amount of money expressed in the promissory note. As an instrument for repaying a debt obligation, money serves as a means of payment
World money	Usually the function of world money is highlighted, when money is used in international turnover. This function is performed using the exchange rate - the expression of the monetary unit of one country in the currency of another country. The formation of this function is associated with the development externally economic ties, the formation of the world market and intercountry capital movement. In fact, it is a derivative of the functions that money performs in the internal economic circulation of countries.

In accounting, cash is reflected:

1. by type:

Cash in national currency, which are special paper and metal banknotes. They play the role of a means of circulation and a universal equivalent in pricing;

Cash in foreign currency. This includes banknotes (paper, metal) of foreign countries, which serve as a means of payment and mutual settlements. These include US dollars, EURO, and other national currencies foreign countries carried out on the basis of interstate agreements;

2. by location:

Cash on hand is necessary funds and monetary documents for the current needs of the organization (enterprise), as well as funds received for various purposes and from various sources;

Cash in transit is cash deposited to the bank through collectors, through communication authorities, to the bank's evening cash desks, which at the end of the reporting period (month) have not yet been credited to the company's current account and are not confirmed by a bank statement;

Cash in the bank. In addition to one main current account, an enterprise can save funds in various deposit accounts with servicing banks.

Conclusion: Money is a special commodity that serves as a universal equivalent, that is, expressing the value of all other goods. There are different theories of the origin of money; money has its own classification by type, as well as a certain set of functions. Cash plays vital role among the organization's assets.

The economic essence of the concept of “cash”

Money as an economic category. Essence, origin, functions and types of money

There are many definitions of money. Some of them are presented in Appendix A. As can be seen from the table, the definitions from various sources differ in some criteria and completeness. To highlight the most complete definition, let us analyze the following table, compiled on the basis of Appendix A.

Table 1.1 - Analysis of the essence of the concept of cash

		Economic justification
Financial resources of the enterprise (organization)	Means of conversion into material resources	Liquid assets of business entities	Securities, property rights, other property
	Kobzik E.G. Accounting and auditing. Part I
	Large economic dictionary Ed. A.N. Azriliyana
	Astakhov V.P. Accounting (financial) accounting.
	Babaev, Yu. A. Accounting.
	Sapego, I.I. Accounting.
	V.B. Ermolinsky Accounting
	N.I. Ladutko, P.E. Borisevsky, A.V. Krupnova, E.N. Ladutko Accounting.
	Levkovich O.A. Accounting.
	Strazheva I.S., Strazheva A.V. Accounting.
	Ilyushchenko E.V. Accounting 100 questions and answers.
	Accounting. Under general ed. I.E. Tishkova.
	Kamordzhanova N.A., Kartashova I.V. Accounting.
	Accounting. Ed. I'M IN. Sokolova.
	Kozhinov, V.Ya. Accounting.
	Accounting.Under general. ed. V.F. Babyns.
	Accounting, analysis and audit. Under general ed. P.G. Ponomorenko.
	M.Yu. Pasyuk Economic dictionary
	V.G. Zolotogorov Accounting theory course
	A.R. Kankovskaya Encyclopedic Dictionary of Economics and Law
	A.N. Shimova Economic theory course

Source: own development

Thus, cash is the financial resources of an organization used by enterprises to finance economic activity, creating reserves of raw materials, materials, fuel, backlogs of work in progress and finished products.

The concept of “cash” includes cash in the cash register and in the company’s bank accounts.

Equivalents Money IAS 7 refers to short-term, highly liquid investments that are easily converted into a known amount of cash and are subject to an insignificant risk of changes in value. They are not intended for investment, but to secure short-term monetary obligations. Typically, this category includes securities with a maturity of no more than three months, less often - bank overdrafts.

The company must independently establish and establish in its accounting policies what exactly will be included in cash equivalents, based on determining their short-term nature, liquidity and exposure to an insignificant risk of changes in value.

Money is a universal equivalent, acting as a real connection between economic entities within the national market.

There are two main concepts regarding the origin of money:

• - rationalistic,
• - evolutionary.

Rationalist theory historically was the first and for a long time the only one. Proposed by Aristotle in his work “Nicomachean Ethics”. According to the view of rationalists, money arose as a result of a social agreement (people agreed to give and accept something as an equivalent for each product).

Proponents of the evolutionary theory of the origin of money (representatives - Karl Marx, Karl Menger) adhere to the point of view that money appeared as a result evolutionary process, which led to the fact that some goods stood out from the general mass and took a special place, acquiring the property of universal exchangeability.

Money evolved through the development of forms of exchange.

According to evolutionary theory, the development of exchange was carried out in the following stages:

• - simple or random form of value;
• - full or expanded form of cost;
• - the universal form of value (the role of money is not a set of goods, but some individual product);
• - monetary form of value (gold, silver, copper coins);
• - expanded or universal monetary form of value (the appearance of credit money).

The reasons that caused the need for money:

• - division of labor;
• - specialization of individual commodity producers;
• - separation of commodity producers from each other;
• - need for exchange;
• - the need to measure labor costs.

To date, none of the concepts presented in the economic literature provides a holistic and consistent explanation of the nature modern money. There is also no generally accepted theoretical definition of money. Therefore, let’s consider the most authoritative ones:

• 1. “Exchange value, separated from the goods themselves, existing alongside them as an independent commodity, is money” (K. Marx, “Capital”).
• 2. “Money is a special commodity - a universal equivalent (equivalence), the form of value of all other goods” (“Economic Encyclopedia. Political Economy”).
• 3. “Money is defined as any commodity that functions as a medium of exchange, a unit of account and a store of value” (L. Harris, “Monetary Theory”).
• 4. “Money is the means by which prices are expressed, debts are repaid, goods and services are paid for, and bank reserves are stored” (Encyclopedia Britannica).
• 5. “Money can be any means that is commonly used universally for payment of goods, services and debts” (Encyclopedia Americana).

The essence of money is manifested in the unity of three forms:

• - forms of general direct exchangeability - any product can be exchanged for money;
• - forms of crystallization of exchange value - money is able to express the value of various goods in the form of price;
• - forms of materialization of universal working time - labor costs can be expressed in monetary form.

More briefly, the essence of money can be defined as follows:

money mediates certain production relations between subjects economic system that arise in connection with the exchange of labor products through the market.

The driving force behind the development of money has always been the contradiction between disabilities material carrier of the functions of money and those public functions which this money was supposed to fulfill.

After the withdrawal of gold from circulation, the characterization of modern credit money irredeemable for gold as a universal equivalent and its function as a measure of value give rise to serious discussions. The most controversial issues include the following: whether gold continues to serve as a measure of value and whether it remains a monetary commodity; if gold has completely lost its monetary functions, then what is the nature of modern money, are they a commodity; if they are not a commodity and have no value, then how can they act as a universal monetary equivalent. One of the main unresolved problems is the problem of the value nature of money. Existing points views boil down to two main directions: the golden concept and the anti-gold concept.

The essence of money as an economic category is manifested in its functions. Traditionally, there are five functions of money: a measure of value, a medium of circulation, a means of payment, a means of saving and accumulation, and world money.

Table 1.2 - Characteristics of the functions of money

		Manifestation of function
Measure of value	Money is used to estimate the value of all other goods and services through the pricing mechanism.	Society finds it convenient to use a monetary unit as a scale for measuring the costs of goods and services
Medium of exchange	The real use of money to service the processes of exchange of goods and services, assets, factors of production by making payments	Money plays the role of an intermediary in the exchange of two goods: T - M - T. Thanks to this, individual, time, and spatial boundaries characteristic of direct commodity exchange are overcome
Instrument of payment	Money is used to make settlements between economic entities for obligations, loans, contributions and other payments	When using money as a means of payment, a gap occurs in the counter-movement of money and goods - there is a debt for goods, services, assets, factors of production, or, conversely, advances for their acquisition
Means of accumulation and savings	There is an increase in the net supply of money in order to increase the total volume material goods and services	In the chain of commodity exchange T - D - T, the sale of a product is not followed by the purchase of another product, and money is taken out of circulation and crystallized in the form of savings and savings
World money	Monetary assets in international exchange goods, capital, services, labor, and as international foreign exchange reserves	World money matters as a universal means of payment, a universal means of purchase, a universal embodiment of social wealth

To understand the essence of money, it is necessary to consider the contradictions of the product and the form of their resolution:

1. The contradiction between use value, which satisfies specific human needs, and value, which manifests itself during exchange in the form of exchange value.

Any product that acts as an equivalent (for example, an ax) has one very interesting property: its usefulness seems to be bifurcated:

a) the usefulness of the ax as an ax, i.e. ability to chop wood;

b) the usefulness of the ax as an equivalent, i.e. the ability of an ax to express the value of another good (for example, a sheep).

For commodity money (fur, livestock, salt), these two utilities are equal and conflict with each other. The contradiction lies in the fact that when using a commodity as a value, one has to give up its consumption, and when using a commodity as a use value, it cannot be exchanged.

2. The contradiction between the concrete and abstract labor expended on its production. As a use value, a commodity embodies concrete labor, qualitatively heterogeneous and quantitatively incommensurable. Value is created by abstract labor, qualitatively homogeneous and quantitatively commensurate.

3. The contradiction between the private and social nature of labor. As a result of the deepening division of labor, the general dependence of individual private commodity producers develops. The production of goods acquires a social character, which manifests itself only during exchange.

A form of resolving product contradictions was the identification of a special product that plays the role of a universal equivalent - money. Use value, concrete, private labor spent on an equivalent commodity, serve as a form of manifestation of their opposite - value, abstract, social labor, embodied in a commodity in the relative form of value. Thus, the product is equivalent, i.e. money becomes the direct and universal embodiment of value, abstract and social labor and has the ability to be exchanged for all other goods.

The essence of money is manifested in the unity of universal direct exchangeability, independent form exchange value, material measure of labor. As K. Marx put it, each product casts loving glances at money, trying to express its value through the monetary material in the form of price.

Money serves the exchange process by performing various functions.

1. Money as a measure of value - through this function, the value of goods receives a qualitative, homogeneous measurement. Equating goods to a certain amount of money also gives a quantitative measurement of the value of goods. To implement this function, a price scale is required. This is the weight amount of metal assigned to a monetary unit. When using full-fledged money, the price scale was set at legislative order. With the abolition of the fixed gold content, the official scale of the price spent economic sense. The function of the measure of value is now carried out through the actual market scale of prices, which acts as a unit of price comparison. Moreover, it should be noted that ideal (mentally imagined) money performs this function.

2. Money as a means of circulation. The purpose of this function of money is to act as an intermediary in the exchange of goods (T-D-T): having carried out the sale of goods (T-D), the commodity producer uses the proceeds to buy the goods he needs (D-T).

The medium of exchange is only real money. The mediating role of money is fleeting. The seller attaches importance not to whether money has its own value, but to the extent to which it is used public recognition. As a result, it becomes possible to replace noble metals conventional signs- paper money.

3. Money as a means of creating treasures and savings. This function is performed by money withdrawn from circulation. If a commodity producer, after selling a product, does not buy another product for a long time, then he thereby withdraws money from circulation, accumulates it, forming treasures. The accumulation of money in the form of treasures is determined by the desire of each commodity producer to have a certain cash reserve in order to protect itself from fluctuations in market conditions. Moreover, the function of a means of creating treasures can only be performed by full-fledged and real money: gold or silver in the form of coins and bars. In addition, the accumulation of treasures is carried out in the form of luxury items made of gold and silver (gold hoarding). You can, of course, save paper money, but they are subject to depreciation. Treasures are accumulated by both individuals and the state - in the form of national gold reserves stored in the country's Central Bank. In conditions market economy treasure as a form of accumulation of wealth (idle, resting money) is of secondary importance, since the main thing is turnover, acceleration of the movement of money.

4. Money as a means of payment. Items do not have to be sold or purchased only for cash. The buyer does not always have cash; the seller sometimes enters into deals to sell future goods. That is, due to various reasons there is a need to buy and sell goods on credit, i.e. with deferred payment. When selling goods on credit, the medium of circulation is not the money itself, but the debt obligations expressed in it. Playing the role of repaying a debt obligation, money realizes the function of payment. This function can be performed not only when paying for goods purchased on credit, but also when paying off other obligations: payment wages, repayment of cash loans, payment of taxes.

5. Function of world money. The creation of a global market was a prerequisite for the emergence and development of this function. Money performs this function in the process of servicing economic relations between countries. When circulating on the world market, money acts as:

International means of payment - repayment of debt obligations arising between countries;

International means of purchase – when purchasing goods abroad for cash;

The universal means of transferring wealth from one country to another is through the payment of war indemnities and the provision of external loans.

At first, as a rule, this function was performed by gold. However, in modern conditions gold lost its monopoly status as an international means of payment - the demonetization of gold. Convertible currencies and international monetary units (SDR, ECU, Euro) are increasingly being used as world money. Gold is used in extreme cases to pay off the balance of payments.