Your view is exactly the position of exogenous money theorists. My point is, there is the other view. > It's worth distinguishing money, which is created by go

Your view is exactly the position of exogenous money theorists. My point is, there is the other view. > It's worth distinguishing money, which is created by government regulation, from other forms of wealth and stores of value. Well, depends on how you define money. In exogenous theories, money are defined extensionally, by listing examples of money, i.e. money is what government issues. However, in endogenous theories, money are defined intentionally, by their properties, i.e. money is something that has not value in itself (have no use value), but can be readily exchanged for something that is valuable (have exchange value). (And then in practice, you have different indicators M1, M2, M3, ..) > The reason that money has value is because the government will demand a certain amount of it as taxes. This is different in the endogenous theory, money simply have value because people deem them to have value. It's not necessarily because government says, "this has value". Bitcoin is obvious counterexample, it has exchange value. > Bonds are a temporary removal of money from the economy. Under the intentional definition of money this is not true. If those bonds can be further traded between the creditors, then they will act as money (they will become a thing that can be exchanged for something else valuable). And you can see that amount of money in the economy increased, because now the original money paid for the bond and the bond itself is potentially in circulation, and can be spent on goods and services at the same time. So bond creation creates new money, and its repayment will destroy the new money. The endogenous theories are built on the observation that there is systemic similarity between a banknote and a bond, they are both intrinsically worthless pieces of paper that represent value for which they can be (possibly) exchanged in the future.