4.8 When Money Failed

What is the best type of money?

Surely you know the story of Joseph and his amazing technicolor dream coat? But you probably only heard the first half of the story–up to the part when Joseph is reunited with his brothers and father. The second half is where it gets dicey.

Joseph was his father’s favorite son. His father, Jacob/Israel, gave him a coat of many colors. This, along with other irritations, made his brothers both jealous and envious of Joseph so they devised a scheme to get rid of the dreamer. As the story goes, they didn’t have the heart to kill him so they threw him in a pit and then sold him to a caravan of Ishmaelite merchants heading to Egypt.

In Egypt, Joseph was bought as a slave by Potiphar. After being falsely accused by Potiphar’s wife, Joseph was thrown in jail. It wasn’t long before Joseph had gained the trust of the jailer and was in charge of all the prisoners. In prison, Joseph ran into Pharaoh’s butler and baker who somehow had offended the King. They both had dreams that Joseph interpreted correctly.

Two years later, Pharaoh dreamed about kine/cows and corn but didn’t know what to make of the dreams. With the butler restored to his post, and remembering that Joseph had interpreted his dream correctly, he suggested that Joseph be given a chance at interpreting Pharaoh’s dreams. As you know, Joseph interpreted the dreams to mean that there would be seven years of plenty followed by seven years of famine. Knowing Joseph to be inspired and directed by God, Pharaoh appointed him to see Egypt through the 14-year crisis.

Back in Canaan, Jacob/Israel and his remaining 11 sons were getting hungry because “the dearth was in all lands; but in all the land of Egypt there was bread.” (Genesis 41:54)  So Jacob sent 10 of his sons to Egypt to get bread. Joseph was eventually reunited with his brothers and his father and his family all moved to Egypt and they lived happily ever after. At least that’s where the Andrew Lloyd Webber version ends. But the story actually continues…

As the famine intensified, Egyptian city slickers found themselves out of food. Joseph didn’t just hand out wheat for the asking though, he sold wheat for money:

“Joseph collected all the money that was to be found in Egypt and Canaan in payment for the grain they were buying, and he brought it to Pharaoh’s palace.” (Genesis 47:14)

When the people ran out of money, they went back to Joseph and pleaded with him saying:

“And when money failed in the land of Egypt, and in the land of Canaan, all the Egyptians came unto Joseph, and said, Give us bread: for why should we die in thy presence? for the money faileth.” (Genesis 47:15)

At that point, Joseph still didn’t give them wheat without anything in return. He resorted to barter:

“And Joseph said, Give your cattle; and I will give you [wheat] for your cattle, if money fail. And they brought their cattle unto Joseph: and Joseph gave them bread in exchange for horses, and for the flocks, and for the cattle of the herds, and for the asses: and he fed them with bread for all their cattle for that year. (Genesis 47:16-17)

By the next year, the poor people were out of money, out of cattle, and out of food so they sold themselves as slaves:

“buy us and our land for bread, and we and our land will be servants unto Pharaoh: and give us seed, that we may live, and not die, that the land be not desolate.” (Genesis 47:19)

So by the time the famine ended, Joseph had purchased all of Egypt. Former city slickers were transitioned into farmers. Joseph loaned them seeds and land to cultivate. They were then taxed one-fifth (20%) of their yield to repay their loans.

After seven years the famine ended and a new Pharoah who “knew not Joseph” took over. Once the economy got back on track and the Egyptians got their freedoms back, they turned their ire towards the children of Israel and blamed them for their hardship and suffering–eventually turning the tables and enslaving the Israelites.

It’s important to note that the Egyptian money (hard commodity money–gold and silver) didn’t fail. The people’s supply of money failed. By exchanging wheat (soft commodity money) for hard commodity money, “Joseph collected all the money that was to be found in Egypt and Canaan.” It failed in the sense that the Egyptians didn’t have any more money. Joseph had it all.

So, what’s the best type of money? In times of plenty (of food), hard commodity money because it has a longer shelf life and isn’t subject to spoilage. In times of famine, soft commodity money because, as the saying goes, “you can’t eat gold”. [26]