The work day had already started. But instead of joining a scheduled meeting, I was outside frantically scouring the neighborhood, looking for “Red” (Jackson’s toy train).

You see, it wasn’t just any toy that went missing.

Rather, it was Jackson’s first ever “favorite toy”. And as a toddler, this was his most important possession! So of course, right after we got back from our morning walk, Jackson noticed Red was missing.

This wasn’t good because I was already late for work.

And since I had a work meeting to join, I tried giving Jackson another toy to play with. But that didn’t work.

Then, I tried to assure him that we would look for Red later in the day, but that didn’t work either. And finally, I even tried to let him cry it out…but that just made him more angry while shouting “Red!” over and over again.

Eventually, I buckled.

Halfway through the meeting, I messaged my co-workers and told them I had an “emergency”. And that emergency was going on a search and rescue mission for a toy train…!

For the next hour, I went outside, retracing the path we had walked earlier in the morning. And along the way, like a madman, I checked under piles of leaves and behind rocks on the sidewalk hoping to finding Red.

Eventually, I gave up.

And since I couldn’t find Red, I devised a “desperate times call for desperate measures” backup plan. The plan was to go to the toy store later in the day, to buy a new toy train (that looked like Red), and try to pass it off as the original…

Luckily, I didn’t need to go with the backup plan.

That’s because after I got home, I emptied out all the contents from the diaper bag. And lo and behold, Red was in there all along (wedged deep inside one of the inner compartments)!

Crisis averted…

For context, the “missing train incident” occurred roughly a year ago, when Jackson was 1.5 years old. And actually, I had forgot about it until recently, when Jackson (now 2.5 years old) was playing at home and found Red buried at the bottom of his toy box.

You see, Jackson has since moved on to many other favorite toys. And even though Red was his first love from a year ago, now, he couldn’t care less about that toy train.

And that’s what I want to talk about today!

What does this have to do with money?

Red used to be Jackson’s favorite toy.

And back then, I would’ve told you with a high degree of confidence that Red would continue to be his favorite toy for a long time too (since it was his first love).

Yet, just one year later, Jackson doesn’t play with Red anymore. He doesn’t ask for it. And if Red went missing again, he wouldn’t notice (or care).

The same thing happens with money.

Day to day, we all think that the money we use (right now) will be the same money that we continue to use (in the future). But, looking at history, we see the opposite – we see that (good) money comes and (bad) money goes.

Let me explain. And more importantly, let me help connect the dots why, as a parent, you should care.

Get paid in salt?

Many many MANY years ago, in exchange for doing back-breaking manual labor, you would get paid with salt (source: NPR).

Yes…the same kind of salt that costs just $1 for a huge bag at Trader Joes today…

You see, back then, salt was hard to find / make. Put another way, it was rare. And it was desirable. Which made it valuable. And because salt was valuable, people were willing to trade for it, including their precious time / energy doing manual labor in exchange for it.

As a matter of fact, to see how prevalent salt was as money, the word “salary” (ie. the amount of money we make at our job) comes from “sal” (Latin for salt)!

And yet, salt isn’t used as money anymore.

Why is that?

Bad money goes away

I’m glossing over thousands of years of history here, but at a 30 thousand foot overview, and in simple terms…

As time went on, people figured out how to find / make more salt.

And as they did, something interesting (but predictable) happened. Salt became less and less rare. And as that happened, it became less and less valuable.

The net effect was that over time, no one wanted to be paid in salt anymore (since it stopped holding its value).

Remember now, from lesson 2, that not all money is equal. So at one point in the long arc of history, salt started as “good quality” money (before it was easy to find / make). But, as it became easier / cheaper to make, salt became bad quality money.

And eventually, it got so bad that salt stopped being used as money all together.

Skeptical? If so, just ask yourself if you’d accept a bag of salt as compensation for doing 40 hours of work.

I sure as hell wouldn’t! Why? It’s only worth $1 for a bag at Trader Joes!

Next, I have a feeling that you might be thinking, “salt was money THOUSANDS of years ago…that can’t happen anymore”.

Ah…but it can! And it does. Let’s take a look.

Money printer go brrrrrrrrrrr!

For many reasons beyond the scope of this blog, around 2008, the government in Zimbabwe decided / was forced to / had no choice but to print more money (source: Wikipedia).

At first, by a little. Then, some more. And then…more.

Taken to the logical conclusion, you can probably imagine what happened to the money used in Zimbabwe. (sneak peek: it suffered the same fate salt did as more and more of it was made)

What do you see in the picture above from Zimbabwe during this period of time? This is a man heading to the grocery store with a literal wheelbarrow of Zimbabwe dollar bills. And he doesn’t seem worried that someone might rob him.

And I think we can all appreciate that if / once you have to cart this much money around to just buy groceries…that the money you are using is / has lost its value at being the tool to help you trade for products / services you and your family needs.

Just like salt stopped being money when it became too easy to make more of, the money in Zimbabwe became bad quality (as more of it was being printed). And eventually, it got so bad that people stopped accepting it entirely.

The takeaway here is that even though it doesn’t happen everyday, bad quality forms of money do go away.

Still skeptical that bad money goes away? Here is a list of 10 other forms of money that have also gone away recently (source: Wikipedia).

(And as a complete aside, if you want a collectors item, you can buy a $100 trillion Zimbabwe dollar bill on eBay)

Good money comes

Now, the next question to ask is, “what happens when a bad quality money goes away?”

Remember, money makes the world go around (lesson 1). We need money to trade – to be compensated for the work we do, to buy products (ie. diapers, food), services (ie. doctors visits), etc.

So, imagine you are a parent living in Zimbabwe. And the money you used last year / month / day becomes so bad quality that no one accepts it anymore.

Does that mean you won’t need to buy diapers anymore, or put food on the table, or continue paying for doctors visits?

No. No. And no!

Money is still needed to make these trades possible.

So what do you do?

Simply put, as that parent living in Zimbabwe…you would demand to be paid in a new form of money that is better quality (Zimbabwe switched to US Dollars – source). And you’ll start buying products and services with this new money too since that is what everyone else accepts.

Before you know it, the old (and bad quality) money will go away, to be replaced with a better quality money in its place.

What does this have to do with bitcoin?

Now that we’ve established three key concepts (lesson 1 – money makes the world go around, lesson 2 – not all money is equal, and now, lesson 3 – good money comes and bad money goes)…

We are finally ready to see where bitcoin fits into all of this!

And I know, while it doesn’t feel like it, you are actually 99% ahead of other parents on your way to having your “ah ha” moment about bitcoin.

Trust me, it’s going to feel putting in that last puzzle piece on your 1000 piece puzzle!

So let’s have that “ah ha” moment together here.