How did money happen?

In the beginning, as tribal people, we started with barter. You have some goats, and need a wife. I have a daughter, and need some goats. Looks like a good deal. Right?

So how did one person successfully convince a group of people that they would give out some paper / round bits of metal and it would be good to trade for anything, anywhere?

I mean it sounds reasonable, but I’m sure they met with plenty of resistance from those who just couldn’t believe that trading their goats for some pieces of paper was a good bargain.

I’ve heard that in times of monarchies every king would mint their own money, which presumably would only be good in his kingdom, and whenever he got his head chopped off some new bloke would come in and invalidate the whole scheme so he could make his own money.

Anyone that can elucidate this process further?

Money.

Interesting that precious metals have always been considered to have “intrinsic” value. I mean it’s not like you can eat them. They’re just shiny. I guess humans just really like shiny things.

How weird.

People used to deposit precious metals like gold with local goldsmiths for safekeeping. They were issued receipts for the gold they had on deposit. If two people were exchanging gold as part of a business transaction it became convenient to just sign over the receipt rather than physically collect the gold and redeposit it. So the paper receipts themselves became a form of currency.

This can’t be right. I’ve got pleanty of two dollar bills in my wallet with dates of 1995, 2003, etc.

Two dollar bills were not printed from 1966 to 1976. They were reintroduced as part of the Bicentennial commemoration (also because the Treasury was trying to phase out one dollar bills). 590,720,000 two dollar bills were printed in 1976. The two dollar bills were not popular and were once again discontinued. But in 1995, the Treasury decided to try again; 153,600,000 series 1995 two dollar bills were printed in 1996 and 1997 and 121,600,000 series 2003 two dollar bills were printed in 2004. Any bills printed prior to 1976 are not the currently valid Federal Reserve Notes and are removed from circulation when they reach a bank. So basically all two dollar bills you’re going to see outside of a collection are going to be dated 1976, 1995, or 2003.

Yeah.
Personally, I think that there would be some point, way far back (stone age maybe,) when the first money started to evolve out of ‘shiny novelties’ that were bartered as luxuries.

A: “Hey, I need something to eat, and you’ve got that big hunk of goat meat you don’t seem interested in finishing right now. Trade you this nugget of shiny gray metal for it!”

B: “Well, that’s cool man, but what good is it? D’you have any mead that I can trade for instead?”

A: “Sorry dude, fresh out.”

B: “Okay, I’ll take the shiny I guess.”

The interesting bit would probably come when a tribe had found a vein of workable gold and silver rich enough to let everybody have some ‘shinies’, and the discovery that it really did make bartering easier – you could trade your flint tools away for so many shinies, and be pretty certain that you could get mead for your shinies, or some carved wooden implements, or whatever you needed. :smiley:

The part about big ‘chiefs among chiefs’ stamping the shinies with their faces, or deciding to use bits of paper instead of shinies, came along, I think, much later, after people had built up some trust in the basic concept.

Metal required quite a bit of labor, effort and equipment to produce. Precious metals also had intrinsic value, as they could be refashioned into something else. Such portable wealth was a good candidate for becoming a means of exchange.

Also, gold doesn’t tarnish or otherwise decay. It’s malleable, and easily shaped into coins or jewelry. It’s relatively rarity means you can carry a significant amount of wealth with you if you need to.

That’s right people, gold’s just a silly passing fad. So anyone who wants to have a real asset should just email me and I’ll take any of that useless gold off your hands and send you a nice healthy goat or a big keg of beer. This offer also valid for silver and platinum.

Okay… so it took effort to ‘work’ the gold. Doesn’t that just make it a little stranger that people would have gone to the trouble? It can’t really be ‘refashioned’ into anything terribly useful or practical, in a primitive society.

There’s a bit of a catch-22 here I see. Gold is ‘wealth’ only because other people will take it in exchange for other goods and services. I still maintain that the only way this cycle could have originally got started was because there were a few people who could afford to trade away food, drink, or whatever else were true necessities for the ‘oooh, pretty shiny’ factor. :slight_smile:
little_nemo: I’m not saying that gold is a passing fad, just that it started out that way. Now that people have agreed it’s valuable - it is. :slight_smile: I don’t have any gold, and I don’t really like beer or goat meat, but I’d trade you precious metals for vodka, koolaid, or beef if I had any. I’d check the financial pages to find out how much it was trading at first though, and not barter it away for less than it’s worth now. :smiley:

Native gold, silver, not so utilitarian. Native copper, though? All kinds of useful!