The word comes into play
when (inter alia) earmarked funds end up in a general account.
These funds are then free to be used for purposes other than intended.
Example: You would like to go on a vacation but you have unpaid car repair bills.
A wealthy uncle hears that you are having financial trouble and sends money to help.
However, he would never have agree to pay for your vacation
–- he’s nice, but not that nice.
Once your uncle’s money is deposited into your checking account,
you are free to spend it as you please.
You then get to pay off your bills and go on vacation.
In essence, you paid your bills (a necessity) while your uncle funded your vacation.
http://blog.mises.org/archives/007321.asp#
Fungibility
Fungibility is the property of a good or a commodity
whose individual units are capable of mutual substitution.
Examples of highly fungible commodities [like oil]
are ...currencies.
It refers only to the ease of exchanging one unit of a commodity
with another unit of the same commodity.
Wikipedia
http://en.wikipedia.org/wiki/Fungibility
Word for the day: Fungible
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