What is money? And why do they lose their value every year?

In real time real value is measured by the ability of money to be exchanged for other things in other words real value refers to the purchasing power of money which includes nominal value plus inflation in nominal turns value is very easy to measure because its simply a measure of the number of units of currency you have that is the volume of money for instance 10 will always have a nominal value of 10 a $1 coin even if its made of pure diamond and is sought after by collectors for billion of dollars still has a nominal value of just $1 only the real value of money not the nominal value is influenced by time so$10 will be $10 next year but it will purchase less than it does this year