Does the money's "Store of value" function actually exists? I'm aware of the following four functions of money:


Medium of exchange.
Measure of value (in dollars, pounds, etc.)
Standard for exchanging goods (guaranteed by the Fed)
A Store of value (as an asset).


AFAIK, the last one didn't exist according to Classical Economists, but only John Maynard Keynes brought it later in his theory.

I want to understand whether this function really exists? I'm more inclined to agree with the Classical Economists - 

I've created a simple analogy to understand this. Suppose there is a small village where there are N residents who trade only in barter. Now, you introduce a new bank in the village called Banko and a currency called pebbles. (For simplicity, lets assume that Banko is both a central bank and also lends/borrows money).

Now in order to leave barter and migrate to currency system, the villagers will have to either sell their goods to Banko, or borrow pebbles from them. So, there is a "give and take" or exchange of pebbles against goods.

But at the end of the day, if you consider the overall macro-economic position, the pebbles made no difference in value at all.  The villager's NET ENDOWMENT is same as it was before, the pebbles just facilitate transactions and used to count their assets now.

So, my question is, if money doesn't make any difference to the REAL value of goods and services, how can it be considered an asset?
What is value? Ultimately, value flows from the utility people get from consuming goods and services.

Now, suppose, in your example world, I am a farmer and it is Autumn so I have the product of a large harvest. Here are three things I could do with it:


Consume (and thereby enjoy the value of) my entire harvest immediately. But this would leave me hungry in the winter.
Store some food for later: Put some of the grain I produced into a silo and take it out of the silo to eat in the winter.
Sell some of my food to the bank in return for pebbles. Then, later in the winter, use those pebbles to buy back some food when my supply has run out.


Notice that points 2 and 3 are essentially equivalent (they result in the same distribution of consumption across time). In the former, I am directly storing food. In the latter, I am using the pebbles to store the value associated with the food until I want to claim that value back.

Although the store of value is really just an abstract implementation of the physical storage of the goods generating that value, this distinction becomes important in more sophisticated economies. Storing value rather than storing the goods that generate that value is attractive for a few reasons.


Many goods and services are hard to store. For example, as an economics professor it is impossible for me to "store" lectures during the autumn for use in the summer when I can't find any students to teach. How do I avoid starving during these long, studentless summer months? I take the (hopefully positive) value my lectures produce during the autumn and store this value in money. I can then claim this value back during the summer when I need it.
Storage of physical stuff takes up a lot of space and is expensive. Storage of money is much less so. Similarly, transporting stuff is expensive. With a bank card it becomes unnecessary to transport money at all. 
Storage is often wasteful because it involves stuff sitting around doing nothing when it could be generating utility for someone.