History Of Money Essay

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To get food through the barter system, a tailor would have to get pretty creative in exchanging one thing after another before seeing bread. But the emergence of money didn’t start with the paper and coins we know and love today.

Cowry shells were one of the first and most popular forms of money, and were used to conduct trade around Africa and Asia; in fact, these shells were used as a currency in Africa (Uganda, specifically) until the the 19th century (1801–1900).

Today, that exchange practice is called the barter system, and it is well-accepted as the earliest form of transaction.

I say well-accepted because anthropologist David Graeber argues that the earliest supposed predecessor of money, bartering, didn’t actually exist before money.

Because people were using and holding the paper note rather than exchanging everything for the backed valuables, European banks started to issue more notes than could be all backed up at once, betting on the hypothesis that every individual holding their notes would not all come knocking on their door the next day asking for gold.

This became the first practice of the expansion of money supply in what we would consider modern money.

Rulers printed their faces or national symbols on them as guarantee that they and the civilizations they commanded would guarantee the worth of the coin; i.e., as long as their civilization existed, the currency would still be worth something.

The shift to using coins made the circulation controllable by the rulers and the currency more trusted by the citizens.

But the emergence of money wasn’t a concerted effort initiated through global agreement that stemmed from Mesopotamia.

Just like today there are different forms of currency, cowry shells were not the universal banknote.


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