WHAT ARE THE DIFFERENCES between wealth and money is what? (read details)?

Question

I was thinking that WEALTH IS TRADED especially in ASSETS SUCK AS STOCK and stock is being traded and so your actually buying part of the companies land and assets etc. MONEY really isn't traded it's just USED as a score card so to speak for how MUCH GOODS and Wealth one can have to TRADE. IS my idea correct? So then people are always talking about the economy and how bad it is people like Bill gates are around and such but DOES THIS REALLY MATTER IF WEALTH IS TRADED. Anyway opinions and ideas and are my ideas correct?

Answer 1

Wealth has intrinsic value but not the money,which has only purchasing power.A bill of say$100.00 has no intrinsic value but can be used to buy /sell or trade.Money can also be traded in terms of it's purchasing power parity in the international monetary market.Economy is a much wider subject which includes national assets and their rate of growth.Well,you are almost there.

Answer 2

You're on the right track. You are right.

Wiki (http://en.wikipedia.org/wiki/Wealth_%28economics%29) defines wealth as "the value of assets owned net of liabilities owed (to foreigners in the case of a nation) at a point in time.".

We both agree that money is essentially the medium required in the purchase or sale of goods and services. The value of money is also 'fiat' meaning that in itself it is worthless but it's value is determined through legal means by the government.

However, I don't agree with you that wealth is treaded and money is not traded. You trade a 20$ bill in for 20$ of groceries when you purchase things. And then if you consider that you can turn your stocks into money, your definition falls through.

One major difference between wealth through assets and money, is the liquidity of them. Assets (stocks, bonds) are not considered liquid because they need to be converted before they have any purchasing power. You cannot use your stocks to buy groceries. Money is considered to have high liquidity since you can use it in its current form to purchase goods and services.

A very basic difference is that wealth is the aggregate value of assets (capital, stocks, bonds, your house, your car, investments) and it includes financial assets (money). Money is just money - your monetary value doesn't take into consideration other assets.