The Past Presented
Everybody wants it. Some people just can’t get enough of it! Life as we know it would be totally wacky if we didn’t have it. If you haven’t guessed what that “it” is yet, here’s a clue… it has many names… moola, stacks, bucks, and cashito. But, for most of us, we simply call it, “Money”! Ever wonder how money came about and why it’s as vital to our daily lives as food and shelter? Let’s do a little investigating to get to the root of it by learning all about the history of money.
Despite being a phenomenon and a part of daily life that goes back thousands of years, money, as we know it, has not always looked like it does today. Through the ages, money has evolved, over and over again. But, the questions remain, how did money become so important? Where did it all begin?
It began as a trade for trade type of system, or bartering, as early as 9,000 B.C. Back then, people would trade for just about anything. Imagine getting a really cool piece of clothing for a couple bags of potatoes! Of course, that might not work at your local mall today, but during that time it worked well for the masses, and using produce and livestock was the primary items that were used in bartering. Many of you would probably love to exchange those Brussel Sprouts for the latest video games if you could. So, no doubt, you can see how useful that financial system was for getting the things that one would need, or want, in their lives.
Then, things got a little more concrete, and people started using an actual form of “currency”. China was first, around 1200 BC, to select a standard form of “money” or currency. They used Cowry shells, which are egg-shaped shells that are home to a variety of sea snails. These beautiful, shiny, porcelain-like shells were believed to be valuable and, thus, they became worth something, which is exactly what having and exchanging money is all about.
Over time, those Cowry shells would be replicated with metal. China was the first country to do that. These were, in essence, the first coins. Most of us can’t even imagine having a wallet, as we know it today, with all of those bumpy Cowry shells or metal Cowry shell-like coins in them. It’s pretty safe to say that most people probably carried their “money” in pouches, instead!
From sea snail shells to metal duplicates of sea snail shells to real metal coins with images imprinted on them… that’s how money evolved. By 500 BC, people were using precious metals like silver to coin money, imprinting them with images of rulers, gods, and anybody that the overall population felt was worthy of being honored on the money. Places like Turkey, Greece, and Rome used money the way that we do today, in exchange for goods and/ or services. The coins that they made were extremely valuable because they were usually formed from gold, silver, and bronze. If you are thinking that this has something to do with the metals that are given out at the Olympic Games, which got their roots in Greece, you are absolutely right!
Before too long, handling all of those heavy coins may have become a drag for some people, and what is believed to be the start of what would become “paper” money. Using deer-skin, long sheets were cut and images made onto them. Thus, the first “bucks” as we call them today, or bills, were born. This took place in China around 118 BC.
If you thought animal hides were a bit wild to use as money, imagine someone telling
you that they will chop off your nose if you don’t pay your taxes? Well, it happened, in 9th century Ireland. People who didn’t pay their poll tax literally had to “pay through the nose”…or more realistically, pay WITH their nose! That is totally gross, but, for those people in Ireland, it was probably a very effective way to get their money.
China always seemed to be a trailblazer when it came to producing money. Between the 9th and 15th century, they finally came up with the type of money that we use now… paper! With its inception, there was likely tons of excitement because it was so much easier to handle, produce, and manage than the other forms of money had been. In fact, it became so popular, that there ended up being a shortage of paper money, and a financial crisis happened as a result of that popularity. However, even with that situation, paper money did not become a part of life for other part of the world until centuries later.
On the other side of the world, the Native Americans had their own “financial” system called potlatch. With potlatch, the person that gave the best gifts at events would be the one held in the highest regard among people. You can only imagine how quickly that system would go berserk as people were constantly competing to give bigger, more elaborate gifts so that they could be treated like celebrities. This could also be the situation that would give place to the saying, “Low man on the totem pole”, which is a way to describe someone that is not in a
position of influence.
Then, around 1500, the Native American tried something that the Chinese had done centuries before. They began to use shells, this time it was clam shells, as money. They called it wampum. Unbeknownst to the Native Americans, the Chinese had learned that this form of money would be a bit cumbersome and could get heavy.
Europeans, on the other hand, began their own financial system, one which was based on the amount of gold that was held. This became known as the “gold standard”, and would remain in effect from the early 1800s until the present for some nations. The United States tried this financial system for valuing money, but during the Great Depression, in the 1930s that practice ended.
Today, we use a combination of paper notes or bills, coins, plastic cards that hold a monetary value which are better known as credit cards and debit cards, and electronic financial systems for moving money virtually. While we have come a long way from using cowry shells, the underlying reality is that money is part of life that may never go away. It is used everyday, all over the planet. With money, you can live in a safe home, travel, eat, and buy things that make you happy. That’s why so many people just can’t get enough of it!