What is the economy?

The ecmonomy when we think about the economy we think about money. So for a start let's go ovoer some of the basics of economy. Economy is the trade of goods between people. In today's economy we mostly use some sort of currency such as dollars, pounds,euros, etc. While the actual material we have the money printed on or pressed on may have no value whatsoever it still has value. This is because the money is backed by the faith of the people. In other words, we all see value in money such as the dollar. A dollar bill being printed on paper has virtually no value in the materials it's made with. The reason it still has value is because these bills are representative of either wanted goods or services. LEts say you go to work and get payed you see value in the money because other people do. You know that you can get some goods or services out of the money you earned. And so with this concept that money currency can be representative of goods or services we widely accept this money like it is a valueable object in itself. Our economies haven't always operated with money but with the actual goods themselves being traded for other goods. For instance an ounce of gold is traded for a stockpile of food. The trader with the gold wants the food and the trader with the food wants the gold. Both items have value because they are seen to have value as they can be traded and used. When we think about it the value of all objects is based on the supply and demand of that item such as gold. Gold being a beautiful metal is not in overly high supply but it is high in demand because just about everyone wants it as gold is in itself pretty much a currency of money. But gold cam still loose it's value. Let's say one day everyone decided to sell all of their shares of gold and no one buys any in return. Because of the high supply and low demand the gold is pretty much worth less. The same can happen with just about any other traded items. We invented money as a way to more widely trade items. If the person trading the food didn't want gold in return a trade would not be made. Money currency however has managed to solve this problem. Because we all see value in money as it can be used to gain a service or good everyone wants it's because it can be more widely traded. But just like with gold money currency can loose it's value as a whole. Let's say the united states switched to a different currency than the dollar. Then all of the dollars in existence woud be worth only the materials they are made for depending on there demand. Now the new currency has value as seen by the people not the dollar. So yes, money just like any other object in the economy can loose it's value just as another object in the economy. Another concept to cover is good economy and bad economy. Good economy is caused when money isn't held very long and as soon as it is earned it is spent and spent again. Now money can be easily come by and the economy is better as goods and services can be easily gained. If the economy however gets too good then everyone has money and then no one wants more and so the economy gets bad again because the circulation of money has greatly decrease by supply and demand. So what is bad economy caused by? The bad economy where money is in low circulation and thus money is hard to come by. In the great depression money was in low circulation no goods could be sold so no money was earned, and so starting the process over again without money in circulation nothing is bought or sold unless we find an alternative to money such as direct trading. So yes the same money we value can rip apart the economy