Talk:History of money

Early comments

This article is conspicuously missing many examples of early money, such as the cowrie shells, and bronze imitations, which are widely regarded as the first true, standardized money. This brief Nova overview of the history of money is vastly superior to the current article, and wikipedia should aim to surpass it: http://www.pbs.org/wgbh/nova/moolah/history.html --Qwasty 05:01, 25 May 2006 (UTC)

The use of types of "claim checks" or "claim tickets" made of paper, wood, bamboo, etc.. upon the stores of ancient city states' warehouses is what "commodity money" had been, not the use of commodities directly in barter. That section of the article should be made clearer. This was the evolutionary step between barter and the eventual use of metal tokens as the mediums of exchange. These warehouse "claim tickets" are what eventually evolved into the "Treasury notes" when city state warehouses evolved into State Treasuries and Banks. It stands to reason that the use of metal tokens was originally a type of security feature to eliminate counterfeiting of paper, wood, bamboo type of tokens because of the difficulty of mining and refining metal and making coins. There is no evidence that gold and silver were valuable in the sense that they are perceived today until these metals in the form of coins started being used as the medium of exchange. And a bit further, the invention of the ledger (in crude form), and money of account happened before money of exchange (paper/coin) was invented. Barter -> ledgers -> city states -> city state warehouses -> warehouse ledgers -> warehouse stores' claim tickets -> Treasuries & Banks -> State minted metal coins -> Treasury & Bank promissory notes. Christopher Theodore (talk) 18:44, 5 November 2017 (UTC)

Please provide the empirical evidence for barter as mechanism of exchange. Smith and Ricardo can be forgiven since they had no ethnographic record of merit to consult. We now have an abundance of evidence from a wide of variety of cultures and oral reckoning of debt to provide goods, or service or labor-time in the future is the far more commmon form of regulating trade in pre-state social formations than barter. Barter is mostly mythos. But I appreciate that you recognize that Gold and Silver etc. have zero "intrinsic" worth - that all worth attributed to commodity money is a social convention and not intrinsic.

B.P?

What does B.P. stand for? Can somone create a link and an explenation?

BP means before present, I have added a link to the page explaining it. --PatClay 22:15, 14 June 2006 (UTC)

Gold amount

In the article:

"It is said that all gold found on earth (which forms approximately a single cube 20 m a side)".

Is that 20 meters or 20 miles?

From above, it would be metres, and my understanding is that it would be more like 75 metres to a side in any case, but that depends if we are talking about bullion reserves, or all gold mined, but it is certainly not all gold on earth (including found but unmined reserves), it seems too small. Octothorn 12:28, 28 February 2006 (UTC)

"Total world gold production from its beginnings in prehistory through 2000 was conservatively estimated to be 142,000 t (fig. 1). This cumulative production is equivalent to a cube of gold 19.4 m on a side." This is from the top of page 8, http://pubs.usgs.gov/of/2002/of02-303/OFR_02-303.pdf Butterman, W. C. and Amey, Earle B. III, Mineral Commodity Profiles–Gold, Open-File Report 02-303, U.S. Department of the Interior: U.S. Geological Survey. Other parts of this publication use "m" to refer to meters, as in "Modern methods in France and elsewhere have increased this (beating a troy ounce of gold into thin sheets) to about 18 m2 and sometimes more."Jimtpat (talk) 01:27, 16 April 2008 (UTC)

Cowrie shells

I've added references to the cowrie shells and imitations to the "commodity money" section of the article. Feel free to elaborate on those if you have good historical sources (academic works, that is, not TV shows). I don't otherwise understand the general complaints above and below, as there is extensive and high quality discussion of coinage, commodity money, barter, and credit money. The credit money part is controversal, but not rubbish: More comments on that below.

Perhaps these complaints reflect that the article should have a better introduction. If people agree on this feel free to propose an introduction, or I will.

Meanwhile, I recommend removing the disclaimer that the article "needs attention" as it is an excellent, well above average article and readers shouldn't be discouraged from consulting it. --198.91.39.109 20:34, 9 June 2006 (UTC)

Etymology claims

In the last section the following claim is made: "Also the French word for money, Argent, derives from the Greek άργυρος, and translates also to silver." Surely "argent" it is from Latin "argentum"? Does anybody know the etymology for certain? Rhyolite 23:46, 22 August 2007 (UTC)

Credit Money

The section on Credit Money in the article is largely rubbish.

There should be some mention of fractional reserve banking in the example section, since that's the only way a bank can lend out someone else's deposits. A 100% reserve would not permit the money to be loaned out without the permission of the owner.

The writer also neglects to mention that the writing of the cheque changes the ownership of the coins, so they are still only owned by one person - you should have them in your account when your cheque is cashed, since they no longer belong to you, so they should probably remain there for the short time until they are reallocated.

It is true that the loaned coins will probably wind up back in the bank again, allowing the reserve requirement to be met more easily, but those loaned coins being returned to not increase the levels of the reserves. I offer a (probably unnecessary) example.

Let's say that I am a very small bank. I have one dollar of deposits and the bank has a 50% reserve requirement, so I loan 50 cents of that dollar - the maximum at this reserve level, which returns to me as a deposit (best case scenario).

I still have only one real dollar in reality, but I now have $1.5 in deposits against 50 cents in loan. I can only lend another 25 cents before I meet my reserve limit. So I lend it, and it comes back in another deposit. Now I have $1.75 in deposits and 75 cents loaned out, but still only one dollar in balance. I can only lend 12.5 cents, etc. In reality, I can only have a maximum of 1 dollar loaned out for every 2 dollars in hand.

Ergo, that part of the Credit Money in this article is really about fractional reserve banking, is poorly written in either case, and should be either removed or moved to fractional reserve banking.

Also I propose the following for the opening paragraphs of that section...

Credit money often exists in parallel with other money such as fiat money or commodity money. Most of the western world's money is credit money derived from national fiat money currencies.

A debt is not money. Debt can not act as a unit of account. All debts are denominated in units of something external to the debt, and so do not affect demand for money (one million dollars is not created when you write it on a cheque, for example). Nor can they be used as a store of value, since the credit is only a reference to money stored elsewhere. Hence credit money is not money, but is a reference to monetary units that already exist prior to the creation of the credit.

Octothorn 12:28, 28 February 2006 (UTC)

There are many theories about credit money, and I can think of hardly any aspect of it where experts all agree. Feel free to add any theories you think are missing and important, and to reword as theories anything you think is improperly worded as fact. I agree with most of the additions proposed here, except that most of the statements of supposed fact, such as "debt is not money," should be stated as "many economists believe that debt is not money," or similar, if that is in fact the case.

198.91.39.109 20:34, 9 June 2006 (UTC)

---

I propose deleting the section on credit money and replacing it with this:

Credit money often exists in conjunction with other money such as fiat money or commodity money, and from the user's point of view is indistinguishable from it. Most of the western world's money is credit money derived from national fiat money currencies.

In a modern economy, a bank will lend all but a small portion of its deposits to borrowers, this is known as [fractional reserve banking]. In doing so, it increases the total [money supply] above that of the total amount of the fiat money in existence (also known as M0). While a bank will not have access to sufficient cash (fiat money) to meet all the obligations it has to depositors if they wish to withdraw the balance of their cheque accounts (credit money), the majority of transactions will occur using the credit money (cheques and electronic transfers).

Strictly speaking a debt is not money, primarily because debt can not act as a unit of account. All debts are denominated in units of something external to the debt. However, credit money certainly acts as a substitute for money when it is used in other functions of money (medium of exchange and store of value).

Reasons: 1/There are other articles on money supply, fractional reserve banking etc, and I don't think we should replicate them all through wikipedia, just link to them. 2/The explanation of credit money was not good. 3/Other people appear to agree with me on at least point 3.

If anyone has concerns, suggestions or amendments, speak up and we can work on them. Otherwise I will make the change in a few days.

--PatClay 22:01, 19 October 2006 (UTC)

Changes made as no dissenting views were heard.

--PatClay 17:00, 10 November 2006 (UTC)

---

PatClay -"A debt is not money. Debt can not act as a unit of account. All debts are denominated in units of something external to the debt"

I would disagree. Money is the debt in which other debts are denominated. The Canadian Dollar is a debt of the Federal Government that, as the national unit of account, is denominated in itself. Vilhelmo (talk) 14:21, 7 November 2013 (UTC)

---

Rewrite Ideas to make WP better than NOVA

I think we should explain clearly that barter has the problem of "double coincidents of wants". To solve that problem, people begin to obtain highly marketable goods for use as exchange medium. Competition naturally sets in as people attempt to discover which commodity functions the best as money. All throughout the world, precious metals, particularly gold, emerged as the best functioning money. The world wide gold standard was a naturally occuring phenomenon. In the 19th century, under this standard, prices were very stable, and the standard of living increased very rapidly.

Banks originate as a safe place to store gold, and the issure paper warehouse reciepts. Because (and only because) these reciepts are redeemable in gold, the paper notes are traded as money. Ludwig von Mises, through regression analysis, proved that money MUST originate as a valuable commodity.

Fractional reserve banking originates by bankers printing up "extra" reciepts, that is reciepts that are not backed by gold. It is counterfeiting with a fancy name. Bank runs are the market solution to this, and bankers hate bank runs, and turn to government to try and legitimize fractional reserve banking.

Governments sieze control of money in a 3 step process. 1) Monopolizing the minting of gold coins. This makes "coin clipping" (inflation) possible. 2) Monopolizing the printing of paper money, which is redeemable in gold. 3) Outlawing monetary gold, and requiring all people to accept paper money in payment of debt, regardless of what contracts may have required. (pure fiat money)

In general, I think the reader would appreciate understanding that gold is free market money, and that pure fiat money can only exist under force, not on a free market.

Comments?

TruthSeeker1234 05:20, 26 May 2006 (UTC)

Utter garbage! Monetary systems have their origin in and are creations of government. Money was invented in the temple & palaces of Sumer as a unit of account to denominate debts (a credit system) as part of an administered price system. ALL money is debt and a unit of account. Gold is gold and any gold standard is a form of government price setting. Money existed prior to price setting markets.

What we call money is a transferable non-interest bearing debt of the federal government, created by the act of government spending and destroy by taxation. Every net dollar is a result of federal deficit spending. No deficit no net private savings. Vilhelmo (talk) 10:05, 4 July 2013 (UTC)

Everything you said was incorrect myth & misinformation See:Modern Monetary Theory: A Primer Vilhelmo (talk) —Preceding undated comment added 01:01, 16 May 2013 (UTC)

Money (or, if you prefer, "proto-money" or "collectibles" or "valuables") is beneficial when a transaction would otherwise require a double (or more) coincidence of wants. The problem arises in any in-kind transaction, such as the payment of a legal fine or tribute or a mortuary distribution (inheritance) or bride price, not just in barter exchange. This is important because in hunter-gatherer societies and in many neolithic societies shells (which have the best monetary properties where the working of precious metals has not yet been discovered) and the like were or are often more frequently used for these other purposes than for trade. These cultures did't have anything resembling efficient commodity markets. The use of shells is common in cultures on opposite sides of the planet that separated at least 60,000 years ago, (and see the evidence of worked shells from Blombos Cave etc. that date back from 30K-75K B.P.), so this all started tens of thousands of years before there was anything resembling efficient commodity markets. This doesn't make Menger's analysis which you relate wrong -- an efficient barter commodity market would give rise to an intermediate commodity, or money -- but this not the actual historical trajectory of the development of money because there were far older problems that required solution to the double coincidence problem. The current WP article (but not NOVA) I think explains this fairly well, but might benefit from the addition of some or all of my explanation given here. The NOVA article does mention some particular kinds of proto-money and money that might also be worth mentioning in the WP article, but I don't think this is crucial.

Well Well Well...

Somtimes the history of monry is un-avalible because it never going to happen... 100 years from now and theirs going to be another and weirder history of money and we wont fully understand the first meaning...You see time just never waits...

I don't think conspiracy theorists are required here.

Good Article nomination has failed

The Good article nomination for History of money has failed, for the following reason:

Following WP:WIAGA,

1a) The prose in this article is not up to a "compelling" standard and many passages are difficult to follow. The lead section, for example, contains grammatical errors, such as a missing space after a full stop.

1b) Lead section should be more focused, a true introduction to the structure of the entire article. The article itself is well-structured, with each idea flowing naturally into the next. The etymology section is out of place, as the article regards the history of the concept of money, not the word money itself. Consider moving the majority to Wikitionary (where word etymology is recorded), and integrating revelant pieces into the main article.

1d) Jargon is frequently used without enough background for a lay-reader to understand it from context. Some examples: "touchstone", "coincidence of wants"; compare with the sufficiently explained jargon "fiat" and "fractional reserve banking".

2b) Very few inline citations.

2c) The main source the article appears to have drawn from is a [self-published paper]. This means it has not been peer-reviewed or fact-checked, and should be used only with caution and after comparing to other sources. See WP:RS

3) Coverage is sufficiently broad. As a suggestion, the origins and history of modern financial entities (e.g. stocks and bonds, mortages, national debt) could also be included.

6a) Images are well-chosen, placement and quantity are good. The license tag of the image "Blombosbeads3.jpg‎" is obsolete and should be updated.

jwanders^Talk 20:01, 25 July 2006 (UTC)

Paragraph Deletion

File:Blombosbeads3.jpg

Shells of the pea-sized snail Nassarius kraussianus. Blombos Cave, South Africa, 75,000 B.P. Wear marks indicate the shells were strung on a necklace.

The use of proto-money may date back to at least 75,000 B.P., when shell necklaces were made in Blombos Cave in South Africa. These necklaces would have provided the basic attributes needed of early money. In cultures where metal working was unknown, shell or ivory jewelry were the most divisible, easily storable and transportable, scarce, and hard to counterfeit objects that could be made. It is highly unlikely that there were formal markets in 75,000 B.P (any more than there are in recently observed hunter-gatherer cultures). Nevertheless, proto-money would have been useful in reducing the costs of less frequent transactions that were crucial to hunter-gatherer cultures, especially bride purchase, splitting property upon death, tribute, and intertribal trade in hunting ground rights (“starvation insurance”) and implements. In the absence of a medium of exchange, all of these transactions suffer from the basic problem of barter -- they require an improbable coincidence of wants or events.

I deleted the paragraph above because of the bias inherant in the dating. Nobody really knows for a historical fact of any dates prior to about 4000 B.C., and thus, although citations may be available, confirmation is impossible. Jason Hommel 05:55, 14 August 2006 (UTC)

The dates are based on radioisotope dating described in peer-reviewed literature, thus are well confirmed. So I'm reversing. What is the significance of 4,000 BC? 67.188.125.25 18:40, 17 August 2006 (UTC)

I've also updated for the more recent discovery dating beads back to 100,000 BP, and added a link to the jewellery article which discusses historical and contemporary observations of monetary use of jewellery. 67.188.125.25 19:55, 17 August 2006 (UTC)

Comments

There needs to be a short explanation of "proto-money" when the word is first introduced.

This is difficult to read: Chinese produces metal imitations of cowrie shells and metal tools that may have been the precursors of coinage.. Changed, PWC

The paragraph after The following example illustrates this. is not written in an encylopedic tone and needs to be amended. I suggested substituting you for a third person example. The story is altogether told too colloqiually. Addressing the reader directly is often a poor practice.

The paragraph beginning with The word money in Greek language is confusing; please clarify it. Rintrah 07:00, 7 October 2006 (UTC)

Does anyone even care about this article? I hope my copy-edits were not in vain. Rintrah 10:26, 19 October 2006 (UTC)

I care. I think the subject is a pretty important one. I fixed one of your problems, I will have a look at the credit money part, the greek, well, that is over my head. Your work is appreciated. --PatClay 17:07, 19 October 2006 (UTC)

Ok. I am reassured. I was beginning to worry because there was little action since I first encountered the article. The paragraph written with "you"s most desperately needs correction. Rintrah 17:22, 19 October 2006 (UTC)

Your correction to the "cowrie shells" section makes it much clearer and is much better written. Good work. Rintrah 17:25, 19 October 2006 (UTC)

I cleaned up the grammar and phrasing in the sections on Indo-European and Semitic words and took out the sections of New Testament explanation which are only tangentially related to the topic. [[User:Womzilla|Womzilla], 2 Jan 2007.

Merge from Social evolution of money

• Merge Social evolution of money repeats much information already contained in this article and seems to be based on a single reference. --SueHay 21:11, 10 May 2007 (UTC)

Creation of money

The a article doesn't explain how money is created through debt. Brian Pearson 15:47, 27 August 2007 (UTC)

Mark of the Beast?

User Xicsies believes that the book of Revelation predicts that the "Mark of the Beast" will be a form of money, and that this should be included in the History of money article. User:Andrew c and I (--Wragge 14:37, 16 November 2007 (UTC)) dispute this, and I'd like to request that Xicsies address our concerns before any further reverting or deleting take place. We feel that:

• A) The citation offered (either in Greek or English) doesn't back up the claim being made. That is, a violation of WP:V or WP:NOR.
• B) That even if the Mark of the Beast is money, it doesn't belong in the "history of money" article, any more that every contencious passing reference to money in any scripture or fiction does. It is off-topic here, and should be fought about in the Talk:Mark of the Beast page.

The possibility that the mark of the beast is money is already mentioned in the Mark of the Beast article. And it is part of the history of money what the early Christian community (as long as any other community of course) believed about money. Xicsies (talk) 13:16, 18 November 2007 (UTC)

The argument so far given by Xicsies (in the summary history) for keeping this passage is that it wasn't challenged for twenty months. I'm sure we can find many articles containing irrelevant passages of personal views & original research with a longer lifetime: preserving them isn't Wikipedia policy. Wikipedia is inherently dynamic, so there's no possible argument from incumbancy.--Wragge 14:37, 16 November 2007 (UTC)

I agree you can find articles containing irrelevant passages with long lifetime, BUT, you can also find much more articles containing passages with long lifetime that are credible. This can easily be proved using statistics, so statistically your argument does not make sense, and statistically I am right. I recommend you to deal more faithfully with any long standing quote.Xicsies (talk) 13:16, 18 November 2007 (UTC)

Give a source, or its original research. Carl.bunderson (talk) 22:11, 18 November 2007 (UTC)

added an external link

http://docs.google.com/View?docid=dfx7rfr2_211crx6c26k Money-History, a very basic outside view point of money and its antecedents.

It looks like a pretty fringe view, so probably not worth a link. If the view is worth a link, then you should be able to find a more professional/academic write-up.Cretog8 (talk) 15:04, 23 June 2008 (UTC)

I would not call it a fringe view as that is negative in connotation. I think the article is better with this link in... as it gives some other aspects to the subject besides the mainstream that are interesting and thought provoking. The article is sourced in multiple ways and the basic history is interesting. skip sievert (talk) 15:57, 23 June 2008 (UTC)

The site may not be added to the ELs. It is on Google Docs, meaning that it is a personally published work. Furthermore, it notes that it is taken from/associated with a blog on blogspot--and the EL policy clearly states that links to blogs are to be avoided. Carl.bunderson (talk) 16:37, 23 June 2008 (UTC)

Moreover, this is thinly veiled self-promotion, Skip. The link is being removed if it is there now, and your talk page has earned a spot on my watchlist. Carl.bunderson (talk) 16:40, 23 June 2008 (UTC)

Well you are entitled to your opinion... but I fail to see how that is self promotion. skip sievert (talk) 16:43, 23 June 2008 (UTC)

Read WP:EL. It is not my opinion. The policy states that you may not link to pages with which you are associated: "You should avoid linking to a website that you own, maintain or represent, even if the guidelines otherwise imply that it should be linked." As your user page points out, you are associated with the blog from which the Google Doc is taken. That is self-promotion. Ergo, you may not post that link on the page. Carl.bunderson (talk) 16:51, 23 June 2008 (UTC)

Ah ok. I read it and you are right. I will not do that in the future. I viewed it though as only information and was not thinking in terms of promotion, but I suppose it ultimately is. Thanks skip sievert (talk) 17:02, 23 June 2008 (UTC)

Thank you for your consideration. Carl.bunderson (talk) 17:04, 23 June 2008 (UTC)

Conflicting articles??

I was interested in looking up "money" because of its function as an abstract conceptualisation of value made concrete. I'm won't even try and say more! LoL I just wanted to see when the concept first emerged. When did the break with other forms of exchange and valuation e.g bartering happen and how did this relate to economic activity and "civilisation" generally? The dates etc given in the various articles here on Wiki differ widely and it seems that the subjects are being considered without reference to underlying concepts. For instance the article on Money identifies the use of gold bars by the Egyptians as a form of money when it is not at all clear that that was their function. Money, I would argue, is NOT simply an exchange item, it's a vehicle for valuation and converts real value (concrete and intangible) into objectivised and absolute value (abstract and tangible). The article on Economy dates the emergence of these ideas back to Aristotle in around 500 BC yet in Money the origins of money are put thousands of years earlier. It is very hard to see how the substance of a concept (money) can predate the existence of the concept itself. LookingGlass (talk) 07:54, 16 July 2008 (UTC)

You might want to check this out Looking Glass. It is not a reference for wikipedia.... but contains I think a good time line and conceptualization frame work for money in general. http://docs.google.com/View?docid=dfx7rfr2_211crx6c26k Money-History&Energy Accounting

Your right about the articles... they are a little conflicting and need more neutral and objective formatting and reference citations or footnotes, which I hope to contribute to. skip sievert (talk) 20:54, 23 July 2008 (UTC)

Noted. Agreed. The lead itself, links to the Money article, but uses a different definition than the lead there. Why? Christopher Theodore (talk) 20:35, 30 November 2017 (UTC)

Resources for improving the page

Add articles here:

• Shelling out - The origins of money

II | (t - c) 10:35, 8 August 2008 (UTC)

Recent religious editing

Good work Carl Bunderson, for quickly reverting the recent edits made by someone, trying to inject what could be viewed as religious opinions or beliefs ... for lack of a better term, into the article. skip sievert (talk) 05:08, 24 August 2008 (UTC)

Thanks, Skip. :) Carl.bunderson (talk) 05:17, 24 August 2008 (UTC)

Representative money section WP:UNDUE

Term is barely used today and various subsections are normally assigned to the other types of money. This is an accurate description of the term which the editor who insists on pushing this POV changed. The original diff here.

The term Representative money was used in the past "to signify that a certain amount of bullion was stored in the Treasury while the equivalent paper in circulation" represented the bullion. REF:William Howard Steiner, Money and banking, p.30, H. Holt and company, 1941. According to Robert A. Mundell what is called token or representative money represents a claim on a commodity, for example gold or silver certificates. However, he dismisses John Maynard Keynes' division of representative money into “fiat money” and “managed money” because it fails to recognize there is a continuum between commodity money and token money.REF:Robert A. Mundell, The Birth of Coinage, Discussion Paper #:0102-08, Department of Economics, Columbia University, February 2002.

Someone more committed to keep economics articles NPOV really has to deal with this, it's getting me very frustrated. CarolMooreDC (talk) 12:02, 25 September 2009 (UTC)

I just added section WP:OR tag and after clean up the Representative money article will cut this down to the couple sentences it merits and add credit money section which is sorely lacking. CarolMooreDC (talk) 15:57, 2 October 2009 (UTC)

I just deleted that whole section as redundant to the section titled the same thing, before it. Why it was there is unknown. The section was repeated twice, to bad effect the second time. The smaller sourced section is still there before the deleted one. The long and rambling second section is now gone. It was o.r. in the sense of not being accurately sourced for the information given in general. skip sievert (talk) 16:27, 2 October 2009 (UTC)

Emergence of Money

I removed a section on oche-as-money which was uncited, as well as a section mentioning jewelry-as-money where the cited article only mentioned jewelry as early trade goods. Here the cite doesn't support the conclusion given in the article.

The uncited sentences which follow also share the same problem of conflating trade with money.

The next sentence looks to Marcel Mauss for support, but the Google Books extract that I read doesn't support the broad conclusion stated in the WP article. The next sentence for which David Graeber is cited, starts with an unsupported premise "When barter in fact did occur..." and concludes with an "...it was usually between either complete strangers or would-be enemies." These seems to contradict other sources on the emergence of money. I will try to verify that article's conclusion is supported by the Graeber text, but it someone can do so sooner, please comment here. patsw (talk) 12:55, 5 October 2009 (UTC)

Graeber's work is supported by the historical evidence. There has been no documented society that used barter as its primary means of exchange & distribution neither between members of a single group nor as a means of trade between two or more distinct groups. It is derived axiomatically from first principles, not evidentially. Hatred of all & any form of government or public institution leads some to rule out by definition the possibility that the origins of money may lie in public institutions. The love of the "market", likewise, causes some to seek the origins of money there. Vilhelmo (talk) 00:31, 16 May 2013 (UTC)

Goldsmith bankers

I think this stuff about goldsmith banking is nonsense, I could not find any evidence for it. There are just some anti-Semitic stories circulating in the internet, trying to stress the role of goldsmiths in the history of banking, because "Goldsmith" is a common jewish name - and so people get the impression that it was all a jewish invention ... Forget this! Forget the idea that every goldsmith in the Middle-Ages had a big safe and lots of gold in it. This would have been much too risky. Forget the idea that a "goldsmith" worked only with gold - he worked as well with silver, copper and other materials, so there was no need to store more gold than he actually made use of. This stuff about goldsmith bankers should be deleted. --Klingsor (talk) 18:00, 6 December 2010 (UTC)

There actually appear to be plenty of reliable sources that could be used to cite this section. Yworo (talk) 23:15, 6 December 2010 (UTC)

I agree with Klingsor. The Goldsmith story is full of ideology. The crucial point is did Goldsmiths issue bills of exchange like ANY merchant, or did the Goldsmith use money stored for safe keeping as his own (fraud). I suspect the first case, but the opponents of fractional reserve banking ALWAYS start with the Goldsmith's tale to insinuate that banking is fraudulent. 182.52.196.140 (talk) 11:18, 1 January 2011 (UTC)

The very first reliable source on Yworo's list states that Golsmiths BECAME bankers - they paid interest on gold deposited with them. In other words the gold was LENT to them and they were legally allowed to do whatever they like with it, including lend it out to others. This is very different from the story of the fraudulent warehouse receipts. 182.52.196.140 (talk) 11:25, 1 January 2011 (UTC)

I don't know how widespread this was, but some pawnbrokers (the Rothschilds for example) became bankers precisely because goldsmiths were forbidden to practice banking. Zyxwv99 (talk) 03:30, 4 January 2012 (UTC)

two sentences removed from introduction

Modern money (and most ancient money) is essentially a token — in other words, an abstraction. Paper currency is perhaps the most common type of physical money. However, objects of gold or silver present many of money's essential properties -- Largehole (talk) 18:02, 4 June 2012 (UTC)

L von Mises

ALL Money is debt, period.

This article is so full of misinformation I'm not sure where to start. All money is a debt of the issuer, whether its stamp on metal, paper, wood, makes no difference at all. The history of coinage is not the same as the history of money. Vilhelmo (talk) 03:21, 17 January 2013 (UTC)

You say that money is dept. But if I have some gold and go to the bank and get some money for it, where is the debt? Actually, there is none.

We also say that a state owns the national bank all the money. But is it true? I doubt it, because a state can't have any debt. It's one of the main purposes of a state to finance infrastructure, schools, aso. In fact people do some work and get paid, either directly from a state or from a private person. So there is no dept.

Debt exists only if you give money for nothing (this is usually called loan or "credit"), or if you do some work and don't get the money (this is debt in common sense). But it makes no sense to distinguish between the national bank and a state, a national bank can't operate independently, the politics and the currency are totally connected. If not, you see what happens in Europe right now: The system crashes. The solution would be either one united European government (actually like in the USA!) or getting back the national currencies.

I repeat it: The separation of religion and state is very useful, but the separation of national bank and state isn't useful at all. It's rather a practical joke. It's just talking...blablah "debt everywhere"... very unreal.

Conclusion: NO money is debt if it's no credit/loan. Period. --178.197.224.225 (talk) 18:47, 8 October 2013 (UTC)

---

- "but if I have some gold and go to the bank and get some money for it, where is the debt? What does selling gold or anything have anything to do with the nature of money?

-"because a state can't have any debt" What? Why would you think such a thing when a brief glance at reality proves it false?

The rest of your comment is gibberish. Vilhelmo (talk) 14:13, 7 November 2013 (UTC)

---

If I possess a 10-euro note, who do I owe? Who owes me? If it is an asset to me, I can expect to exchange it on demand for gold or other goods and services. When I do so, I exchange one asset to another. That 10-euro note never becomes a thing that is promised to anyone else until I contract a good or service. D. F. Schmidt (talk) 12:39, 18 September 2018 (UTC)

Early usage

The allegedly Greek word in this section is not Greek. Not least because it has a Latin letter in it (the accented sigma, which perhaps is supposed to be an alpha?). It's not clear to me what the word is supposed to be anyway. A link to something like the Perseus on-line version of the Liddell and Scott lexicon would help. — Preceding unsigned comment added by Eponymous-Archon (talk • contribs) 15:07, 21 February 2013 (UTC)

ATTENTION! ERROR - The History of Money is NOT the History of Coinage

The first sentence contains a major error. It reads,

"The history of money begins around 2500 years ago with the first minting of coinage in about the seventh to sixth century BC"

This is patently false. The history of money is not synonymous with the history of coinage. It is widely accepted that money originated as a unit of account in the public sector temples & palaces of bronze age Mesopotamia.

Sources:

• The Archaeology of Money by Michael Hudson
• The New Economic Archaeology of Debt by Michael Hudson
• Role of Accounting in Civilization's. Economic Takeoff by Michael Hudson

• Creating Economic Order: Record-Keeping, Standardization and the Development of Accounting in the Ancient Near East (ed. with Cornelia Wunsch), (CDL Press, Baltimore, 2004).
• Debt and Economic Renewal in the Ancient Near East (ed. with Marc Van De Mieroop) (CDL Press, Baltimore, 2002).
• Urbanization and Land Ownership in the Ancient Near East (ed. with Baruch Levine) (Cambridge, Mass: Peabody Museum (Harvard), 1999).
• Privatization in the Ancient Near East and Classical Antiquity (ed. with Baruch Levine) (Cambridge, Mass: Peabody Museum (Harvard), 1996).

Vilhelmo (talk) 04:35, 20 June 2013 (UTC)

I agree, and the problem is not only with the first sentence. For example the commodity money section still assumes that barter preceded commodity money. Alæxis_¿question? 11:08, 13 March 2016 (UTC)

Funds versus loan

In this view, money emerged first as credit and only later acquired the functions of a medium of exchange and a store of value.

It should somehow be mentioned, that since the invention of paper money in China this "credit" was in fact a deposit (aka. "fund"), but no loan. The invention of loans came much later, after the money producing monopolists (i.e. banks) wanted to earn interest. However, nowadays the word "credit" usually means loan. This is probably also an issue of the English language because there is no common word used like fund (or "accompt"). So therefore I'd change the sentence: In this view, paper money emerged first as funds and only later acquired the functions of a medium of exchange and a store of value. That's exactly what happend in old China. It's quite unfortunate that in English the word credit is used for both loan and fund. Interestingly this may also be the reason why credit cards are much more popular in the English speaking regions. Language makes the people, deeply influencing their way of thinking - and their behaviour, too. --178.197.224.225 (talk) 18:15, 8 October 2013 (UTC)

External links modified

Hello fellow Wikipedians,

I have just added archive links to one external link on History of money. Please take a moment to review my edit. If necessary, add {{cbignore}} after the link to keep me from modifying it. Alternatively, you can add {{nobots|deny=InternetArchiveBot}} to keep me off the page altogether. I made the following changes:

• Added archive https://web.archive.org/20111210152420/http://www.socialtextjournal.org:80/reviews/2011/10/review-of-david-graebers-debt.php to http://www.socialtextjournal.org/reviews/2011/10/review-of-david-graebers-debt.php

When you have finished reviewing my changes, please set the checked parameter below to true to let others know.

This message was posted before February 2018. After February 2018, "External links modified" talk page sections are no longer generated or monitored by InternetArchiveBot. No special action is required regarding these talk page notices, other than regular verification using the archive tool instructions below. Editors have permission to delete these "External links modified" talk page sections if they want to de-clutter talk pages, but see the RfC before doing mass systematic removals. This message is updated dynamically through the template {{source check}} (last update: 18 January 2022).

• If you have discovered URLs which were erroneously considered dead by the bot, you can report them with this tool.
• If you found an error with any archives or the URLs themselves, you can fix them with this tool.

Cheers.—^{cyberbot II}_{Talk to my owner:Online} 01:47, 13 January 2016 (UTC)

External links modified

Hello fellow Wikipedians,

I have just modified one external link on History of money. Please take a moment to review my edit. If you have any questions, or need the bot to ignore the links, or the page altogether, please visit this simple FaQ for additional information. I made the following changes:

• Added archive https://web.archive.org/web/20070908205713/http://www.yale.edu/lawweb/avalon/medieval/hammint.htm to http://www.yale.edu/lawweb/avalon/medieval/hammint.htm

When you have finished reviewing my changes, you may follow the instructions on the template below to fix any issues with the URLs.

This message was posted before February 2018. After February 2018, "External links modified" talk page sections are no longer generated or monitored by InternetArchiveBot. No special action is required regarding these talk page notices, other than regular verification using the archive tool instructions below. Editors have permission to delete these "External links modified" talk page sections if they want to de-clutter talk pages, but see the RfC before doing mass systematic removals. This message is updated dynamically through the template {{source check}} (last update: 18 January 2022).

• If you have discovered URLs which were erroneously considered dead by the bot, you can report them with this tool.
• If you found an error with any archives or the URLs themselves, you can fix them with this tool.

Cheers.—InternetArchiveBot (Report bug) 11:38, 3 April 2017 (UTC)

Barter in 9000 BC?

“ As early as 9000 BCE both grain and cattle were used as money or as barter (Davies) (the first grain remains found, considered to be evidence of pre-agricultural practice date to 17,000 BCE). ”

There's a problem with this part of the Emergence of Money section. Davies's book is supposed to be the source on the existence of barter in 9000 BC but I've just checked the part of it dedicated to barter (pp 9-18) and there's no mention of it there (and has no concrete examples of barter anywhere else, for that matter). So either this information was taken from another source or it's not sourced at all. While the references look formidable, they lack page numbers which makes it hard to find what exactly do they say. Alæxis_¿question? 12:43, 7 June 2017 (UTC)

In the end I found where Davies talks about money in that period and made changes accordingly. Alæxis_¿question? 19:07, 16 June 2017 (UTC)

I also find this section of the article to be confusing: it confuses barter with money in the opening sentence. Money is not just the use of *any* object as a medium of exchange, but the use of a thing without value (or very little value) as an abstract representation of other objects that have value. If an object has an inherent value (even if it is commonly traded), then it's not money or a monetary system, it is the barter system. Christopher Theodore (talk) 20:54, 30 November 2017 (UTC)

What does obsidian trade have to do with money?

“ Anatolian obsidian as a raw material for stone-age tools was distributed as early as 15,000 BCE, with organized trade occurring in the 9th millennium. (Cauvin;Chataigner 1998) In Sardinia, one of the four main sites for sourcing the material deposits of obsidian within the Mediterranean, trade in this was replaced in the 3rd millennium by trade in copper and silver. ”

It's not clear how this passage is related to the topic of the article. Okay, trade existed in 15,000 BC and in 9,000 BC and in 3,000 BC, so what? It must've been quite a different trade compared to the modern one. Does it mean that money existed as well to facilitate that trade? If yes, it should be explained clearly in the article. It's hard to examine the provided sources since no page numbers are given and the second reference is a matryoshka one with four links to google books (actually there was also another one to Stephen King's Shawshank Redemption which I've just deleted).

I propose to remove this passage as it's not relevant to the topic of this article but would be happy to salvage something from it. I'll also try to look at the sources and try to see if they have something to do with money. Alæxis_¿question? 13:00, 7 June 2017 (UTC)

I've examined two sources, 'Measurement in navigation...' and 'The Complete Archaeology of Greece' and haven't found any assertions about the money in the Neolithic. Alæxis_¿question? 14:57, 13 June 2017 (UTC)

Money boxes

The earliest means of storage are thought to be money-boxes (θησαυροί) made similar to the construction of a bee-hive, as of the Mycenae tombs of 1550–1500 BCE.

Couldn't find which source states that this was the earliest means of storage and it's not even clear what was stored there. It seems unlikely since silver and gold had been in use before those times and probably had had to be stored somewhere. I suggest to remove the passage unless its relevance is established and sources fixed. Alæxis_¿question? 13:12, 1 July 2017 (UTC)

Article structure is a mess

The article's structure is not up to the standard of an encyclopedia. The sections start in chronological order and then become just a laundry list of various types of money. The scope of the article is not clear - it is about the "broad money" or just physical objects (in my opinion the former option is preferable). There is a lot of unsourced claims - I dealt with a couple of the most appalling ones but that's just a tip of the iceberg.

To start improving the article its structure should be agreed on. Since this is an article about the history of money the chronological order would probably be most uncontroversial and convenient.

Glyn Davies uses the following periodisation: 3000BC-600BC; 600BC-410AD; 410-1485; 1485-1640; 1640-1789; 1789-1914; 1914-now)

Jack Weatherford's one is: before 600BC; 600BC-200BC; 200BC-1300AD; 1300-1450; 1450- ... These two books are too Eurocentric for my liking, couldn't find anything on Chinese paper currency there for example Davies's book actually deals with Chinese paper money.

David Kroeber in his book about the history of debt divides the history into the Axial Age (800BC-600AD), Middle Ages (600-1450) and Age of Empires (1450-1971) What are other good and recent overview books on the subject? Alæxis_¿question? 20:02, 16 June 2017 (UTC) So a possible periodisation could be something along the lines of

1. Pre-3000 BCE (gift economy, trade, barter)
2. 3000BCE-600BCE (credit & silver in Mesopotamia, ...)
3. 600BCE-400CE (coinage, Roman finance)
4. 400-1450 (first banknotes, tally sticks, medieval European coinage)
5. After 1450 Alæxis_¿question? 15:19, 17 June 2017 (UTC)

I've reordered the information here, feel free to check it out. Disclaimer: I haven't changed the content so there are some repetitions and awkwardness and the problems with sources remain, so it's just to get the impression of a new approach. Alæxis_¿question? 21:27, 21 June 2017 (UTC)

@Alaexis: I support your reordering the article into chronological. One problem is how to define money. I think the lede of the article too narrowly focuses on just its function as a medium of exchange. From the article:

The history of money concerns the development of means of carrying out transactions involving a medium of exchange. Money is any clearly identifiable object of value that is generally accepted as payment for goods and services and repayment of debts within a market or which is legal tender within a country.

This is clumsy, could be reworded stating the different forms money has taken.Jonpatterns (talk) 14:24, 10 August 2017 (UTC)

@Jonpatterns: I agree, the whole lede doesn't flow well. Do you have an idea how to rewrite it? Alæxis_¿question? 09:42, 11 August 2017 (UTC)

---

I have finally changed the article as proposed earlier (for now only the first half, before the Trade Bills of Exchange section). Feedback is definitely welcome, specifically whether I missed something important from the old article, comments on the new structure, what else should be included. Alaexis_¿question? 10:46, 11 August 2017 (UTC)

I've made the rest of the changes I planned. I hope now the article makes a better work of conveying to the readers how different types of money complemented each other in different places and periods of time, and also how various types of money emerged, spread and then sometimes disappeared only to appear again.

There are several sections and topics that require further work:

1. Overview. It would be nice to have a bird's eye view of the emergence and development of money.
2. Debasement, crying the moneys up and down which was an issue both in Rome and in medieval Europe (see Davies's book for example)
3. Fiat money How and why the money backed by precious metals made way for purely fiat money in the 20th century. Alaexis_¿question? 12:58, 18 August 2017 (UTC)

• I have an issue with some of the wording like "other forms of money such as bank accounts" (unsourced, from the lead) which could use some serious improvement and sourcing to improve the overall quality of the information. A Guy into Books (talk) 09:39, 24 August 2017 (UTC)

Emergence of Money - Presumptions

The confusion in the article of what is properly still the barter system, with the use of abstract representations of value as mediums of exchange aka money (money of exchange or money of account), must be eliminated. Barter should be mentioned because it is an evolutionary step in the History of Money, but the distinction must be clarified. This confusion taints the lead and the article.

I think we can all agree in light of the evidence (and lack of it) that the true invention of money and its origins in history can be said to precede written history. Thus, we are left with making presumptions (and do note the subtle distinction between a "presumption" and an "assumption").

There has been some debate about which came first, money of account or money of exchange. Again, this precedes written history. We do find written evidence of ancient historians speculating on the origins of money along these lines. So even they were not quite sure... and made presumptions.

We also find that the use of money of exchange in the form of tokens made of paper, wood, bamboo, shells, etc.. as types of “warehouse claim tokens” for goods stored in the ancient city states’ warehouses occurred long before people started mining and refining gold & silver and striking coins. These tokens represented goods stored in the warehouses (like grain), and it was the goods in the warehouses that were valuable, not the tokens. The token could be exchanged in the barter markets as if they were a bag of the grain only because the token could be taken to the warehouse and traded for a bag of grain.

It stands to reason that the use of metal tokens ([bronze], gold, and silver coin) as the medium of exchange was turned to originally as a type of security feature to hinder counterfeiting of the warehouse claim tokens because of the difficulty of mining and refining it, not because it was scarce or inherently valuable. In fact, there is no evidence that gold & silver became valuable in the modern sense until being used by the ancient city states as the medium of exchange aka money of exchange.

It also stands to reason that, even older than the invention of money of exchange in any form, is the invention of the ledger in very crude forms (tally sticks & hash marks), and the presumption should be that the oldest form of money is most likely money of account — credits & debts on a ledger representing something of value, or something of value owed.

This presumption becomes even stronger when we consider how the warehouses of small townships or tribes would naturally be created and those responsible for managing them would start doing things before the invention of money of exchange. Tally sticks would work fine for small community but with a large city state you can see how quickly it would become an accounting nightmare especially with such crude ledgers (which gives birth to the need for money of exchange and evolutions of the ledger).

Consider this line of reason and the presumption it gives rise to, supports, and strengthens:

1. The development of the agrarian cultures & harvests, and barter of the harvest with those involved in crafts & hunting comes first.
2. Next, barter fairs emerge which are the seed of the first towns (that later grow into city states).
3. Next, problems with bartering a harvest (a very time consuming thing) and sustaining a farms (another very time consuming thing) gives rise to the need of, and invention of, the warehouse and the ledger -- Farmers drop off their harvest, get credit and have the ledger adjusted so people in the fair can come collect their portion of the harvest and are able to get back to their farms.
4. This gives rise to the concept of the "claim ticket," "token," "note", etc.. representing claims on goods stored in the warehouses as the small towns grow into larger communities and eventually cities because Grak the Farmer can no longer tell Besmal the Warehouse Manager that Brun the Hunter can take 3 bags of grain because there are just too many people and people no longer know everyone in town.

I find support lacking for the CURRENT PRESUMPTION (more of an assumption, in fact) that dominates this article, and that presumption is that money of exchange was invented first. The use of an abstract token representing stored goods in a warehouse is a much more complicated series of thoughts than making hash marks on a tally stick. And the confusion of the barter system with the use of money is not justification of the presumption that things commonly bartered constituted the invention of "money" in it's true sense.

Further, we have evidence of the existence of the tally stick in conjunction with the reasoning presented above supporting the presumption that money of account is the oldest form of money... and further, that this gave rise to the invention of money of exchange. Christopher Theodore (talk) 22:19, 30 November 2017 (UTC)

Hi! What do you propose to change in the article? A lot of what you're saying makes sense - but in any case we need sources confirming that. Alaexis_¿question? 15:28, 3 December 2017 (UTC)

As an example, the transition from barter system to use of money (coins), in Rome, would make a good example and is already supported in the Wiki Article Roman Republican currency. In this article, we see the history of using aes rude (rough bronze - which is still properly the barter system - the value of the weights were related to it's use in blacksmithing), into bars that had a 5 pound pre-measured weight to make barter easier called aes signatum (signed bronze - which is still properly the barter system - again, the value of these weights were still based on the usefulness of bronze in blacksmithing). And finally, there was a break from barter system related weights based on the usefulness of bronze in blacksmithing, into weights measured into coinage because of the usefulness of bronze as a medium of exchange in conducting transactions. The aes grave (heavy bronze) or as is the start of this in Rome.

There are likely other earlier examples of this transition from barter system principles to the actual creation of an abstract representation where the inherent value of the metal was no longer what the 'face value' was based on that could be pointed to as well. Christopher Theodore (talk) 20:00, 12 December 2017 (UTC)

What you are describing is not actually barter, since there existed a single medium of exchange. But I definitely agree with you that the process of arriving to coin-based system could be described better - now the Coinage section does not flow well. Within that section, the developments in Greece/Asia Minor should be given more space since it was there where coins appeared. Alaexis_¿question? 21:05, 3 January 2018 (UTC)

Alaexis, kindly forgive any confusion I may have caused. My point is that before there was an agreed upon "single medium of exchange" it was due to that thing being bartered by everyone and this is why it became the "medium of exchange". The use of a medium of exchange didn't happen by magic one day, it was a process that evolved over time (Raw bronze (barter) -> Bronze in bars (barter or money?)-> Bronze Coin (money) -- and this was all due to the root fact that everyone wanted blacksmiths to do work for them and blacksmiths needed bronze to do the work -- I am being overly simplistic). The barter system precedes and gave birth to the monetary system[s] and the evidence supports this presumption (not the other presumption(s) being made). The Birth of the Monetary System should be a section included in this article... and to do that requires a bit of commentary upon the barter system and a clearer juxtaposition between the 2 systems. Christopher Theodore (talk) 20:56, 27 April 2018 (UTC)

There are many sources that indicate money as a medium of exchange developing from barter. However, some scholars question this (including (David Graeber). They consider the barter -> money development with scepticism, claiming it was popularised by assumptions made by classical economics such as Adam Smith. Jonpatterns (talk) 12:13, 7 September 2018 (UTC)

Jonpatterns monetary systems didn't just magically appear, they developed. How? These sceptics present nothing reasonable that creates a stronger presumption than classical barter system -> monetary system doctrines. Until they do, the stronger presumption continues to prevail, (even if there is no evidence of the pure barter system.. because there is no evidence of the magic appearance of monetary systems either). Further, on the lines of reason, barter is a very simple thought process, monetary systems are a much more advanced set of thought processes that incorporate and build upon the simplicity of the barter system thought process. FYI, barter system don't leave a paper trail... I am not sure what evidence the anthropologists were expecting to find, but it is unreasonable to expect to find evidence that can't possibly exist. Lots of scholars are looking to sell their books, regardless of how ignorant their postulations actually are (the postulation ignore other elements of reason used in developing theory, don't mistake that as an ad hom). Are you able to make a clear distinction between an ASSUMPTION and a PRESUMPTION and why I specifically chose the word PRESUMPTION? They are NOT the same thing. Christopher Theodore (talk) 00:10, 23 January 2019 (UTC)

A fairly weighted summary of the academic positions should be given. Wikipedia is not based on original research. Jonpatterns (talk) 11:29, 23 January 2019 (UTC)

Nor is it based on the published work of an obscure theory of an expert in a field that is off topic... David Graeber's work should not be relied upon as representing any kind of main stream view and your attempts to bias the article towards his theory is not lost on us. Christopher Theodore (talk) 04:15, 25 January 2019 (UTC)

@ChristopherTheodore: A fairly weighted summary of the academic positions should be given. Jonpatterns (talk) 11:57, 2 February 2019 (UTC)

Like this one from Stanford. Wingsail (talk) 20:32, 4 February 2019 (UTC)

No, this is History of Money, not the History of Monetary Theory/Philosophy. So it is more like this one -- I am working some reference from this article into the 'money of exchange' section in the Overview. I am also going to use it to support the statement about "the invention of money existing before written history" because the evidence supports money was created before written language was developed. I am digging into the History of Accounting article as well to glean cites for the "money of account" section of the Overview. Christopher Theodore (talk) 19:34, 5 February 2019 (UTC)

All "Histories of Money" are theories, and the theories of the history derive from the theories of money. What you think it is determines how it must have come into being. The Stanford link demonstrates even-handed treatment of the two (main) theories of money. That's all.

Isn't 'representative money' actually just credit notes? If it is then don't your tokens belong under money of account? Wingsail (talk) 00:23, 10 February 2019 (UTC)

@Wingsail: No. Representative money would include the 2 broad forms that money takes (money of... account & exchange) so long as the money remains an abstract representations of assets (money inherits its face value from the assets it is created to represent). A US Gold Certificate is a very clear modern example of "representative currency". Money of account can also be "representative currency" so long as the ledger entries are not fraudulent. The money of account that central banks create are not just baseless entries on the general ledger, every entry represents the monetary value of an asset. The main bundle of assets used by the banks to create money are a bit strange though... because a loan contract (which is what the positive ledger entry represents) is both an asset and a liability. Thus, the ledger must reflect both the monetary value of the asset (credit) and the liability (debt). This is were double entry book-keeping comes into play -- which I am not going to delve into much further here but here is a short video series based in large part on Richard A. Wernner's work: https://positivemoney.org/how-money-works/banking-101-video-course/

One could consider "representative money" a subset of money of account, where the account entry represents the deposit of a hard asset rather than a more abstract unit of account. However, it does not work for money of exchange since its raison d'etre is to eliminate the need for an account, to do which its value must reside in the token itself. I am familiar with (some of) Werner's work and agree with it. Why do you think it supports your position? Wingsail (talk) 03:05, 25 February 2020 (UTC)

@Wingsail: Simply stated, Werner's work (and other sources like the IMF and Chicago's Fed) shows how the debt instruments are used to create the 'money of account' aka 'bank deposit'. Again, 'debt instruments' are both an 'asset' and a 'liability'. However, the 'money of account' (the positive number in an account on the ledger) represents the asset side of the 'debt instrument'. What do you imagine the positive numbers on ledgers (money) represent if not assets? Are you confusing the 'debt instrument' with the 'debt' (a negative number on the ledger -- the opposite of money) resulting from the accounting for the liability side of the instruments? It's not a 'theory' that the 'money of account' represents this strange asset called a "debt instrument", its a proven fact. A mortgage contract (one kind of debt instrument) is a thing very separate from the account entries made to represent the '2 sides' of it.

'Loans create deposits', and deposits are, or at least act like, money. This is not where our disagreement lies (I think). It now seems to me that your view of what differentiates money of account from money of exchange is whether or not some (any) money-thing is physically exchanged; a bank deposit is money of account but withdraw it in cash and it becomes money of exchange. Really? Wingsail (talk) 22:06, 25 February 2020 (UTC)

<<Outdent| @ChristopherTheodore: Looking back at the start of this section and the associated edit I find we are less in agreement than I thought.
You wrote on 2017-12-13: " money of account (debits and credits on ledgers) and money of exchange (tangible mediums of exchange representing value made from wood, paper, bamboo, metal, etc..)"
I am content with your 'money of' terminology but don't think your definitions are quite right. 'Money of account' is records of credit and debt but not necessarily on ledgers, it can also take the form of tokens made from wood, paper, bamboo, metal, clay, any kind of IOU, receipt, credit note, bank note, etc. Whereas 'money of exchange' is a commodity of 'intrinsic' value which is used as a proxy in barter and has no associated debt/credit.

@Wingsail: Money of account can only exist on a ledger (or whatever synonymous term for "ledger" you want to use -- I dare say the first ledger wasn't even a physical thing like a tally stick or a clay tables with hash marks, but rather was just something people did in their heads) and money of account is never "tokens made from wood, paper, bamboo, metal, clay, any kind of IOU, receipt, credit note, bank note, etc.". Accounts are creatures of the ledger and the conjunction of the 2 words gives birth to the term: money... of account. Money... of exchange is any form of money not existing on a ledger.. because it is all the forms that money takes which people exchange hand-to-hand. Further, the 2 terms are mutually exclusive and are used to illustrate the 2 broad forms that all manifestations of money take and have taken.
Christopher Theodore (talk) 01:34, 4 October 2019 (UTC)

"never"? Do you deny that the banknotes in my wallet are money of account? The (worthless) tokens are portable account entries on the original "distributed ledger". If the value is not on a ledger it must reside in the token itself. Where else could it be? Indeed, the two terms are mutually exclusive: money of exchange must have an intrinsic value equal to (or greater than) its face value (if any) otherwise it must be money of account. Wingsail (talk) 03:31, 25 February 2020 (UTC)

"Money... of exchange is any form of money not existing on a ledger.. because it is all the forms that money takes which people exchange hand-to-hand."
No, the fact that people are exchanging tokens does not imply that there is no ledger involved somewhere. Wingsail (talk) 18:00, 25 February 2020 (UTC)

I do not think it can be said that 'money of account' led to 'money of exchange', they are quite different concepts and developed to meet different needs. Unfortunately, much historical writing has been premised on the assumption that all money is 'money of exchange' and has shoehorned everything into that framework. 'Representative money' is one example of such shoehorning. I think this article is still riddled with it, including your sterling efforts I'm sorry to say. Wingsail (talk) 01:44, 12 February 2019 (UTC)

@Wingsail: I did not just "say it" and I am not going to rewrite what I have presented in support of that statement (which consisted of more than just logic based reasoning -- there is enough indirect evidence to support the presumption. Feel free to actually build a strong enough presumption to support your contradiction and use indirect evidence that is verifiable. I can not see how you are drawing your conclusions. Regarding your statement about "representative currency", this is a more modern term that includes both money of account and money of exchange. It is juxtaposed with money that doesn't represent assets. A Bill of Credit that is not created to represent an asset is identical in essence to a ledger entry that doesn't represent an asset. Both are actually forms of fraud. It is why every Nation that has turned to "creating money out of thin air" has had that currency fail... including the very first Bills of Credit issued by the US (they were a series of $2 bills called Continentals).
Christopher Theodore (talk) 01:34, 4 October 2019 (UTC)

@ChristopherTheodore: I have suggested previously that one's preferred theory of money influences one's interpretation of evidence. Much of the evidence you think supports you, I think supports me. As to the "thin air" money failing trope: has anyone done a proper survey? My impression is that it is attempts to replace or unify money of account with money of exchange that usually fail within 20 years, whereas most money of account currencies in the developed world have been floating on air for 50 or 90 years and look to continue doing so as long as their issuers are able to collect taxes. Wingsail (talk) 04:20, 25 February 2020 (UTC)

Now I think I see a way forward here.
We are dealing with two basic kinds of money which developed in parallel, not from each other, for two different purposes.
I suggest that this article therefore needs two Histories of Money.
Money of account developed from simple debt/credit relations within groups. It is manifested in myriad forms of (usually valueless) token and ledger. Barter played essentially no role in this story.
Money of exchange, in contrast, is all about barter between groups. It is manifested in pieces of a valuable commodity.
At present we have these two stories hopelessly tangled and confused. Wingsail (talk) 01:34, 14 February 2019 (UTC)

Money is one thing, and has a single purpose. I can recognize that the 2 broad forms it takes meet subtlety different needs and have subtlety different purposes but they remain rooted in the singularity... Much like the spectrums of light all originate from white light. Christopher Theodore (talk) 01:34, 4 October 2019 (UTC)

I wouldn't call the difference between domestic and foreign trade subtle, nor the difference between valueless and valuable tokens. If there is an account or not. These differences are clear and fundamental. Whether account entries are made by writing in a book or by exchanging tokens is superficial. There is certainly ambiguity, largely introduced late in the game by the many attempts to use money of exchange domestically, peg exchange rates etc. (You also have light backwards.) Wingsail (talk) 18:09, 8 March 2020 (UTC)

• Most of the prevalent, mainstream analysis claims that money evolved through separate, yet numerous, individual actions: People who were engaged in barter agreed, at some point in pre-historic time, upon a common medium of exchange and began using it as money. This is the dominant paradigm, if one examines the literature, the academic curriculum, and the media. We cannot avoid presenting this in Wikipedia. But we can attempt to offer alternative, yet evidently more solid, theories about the origins and the history of money, always of course on the basis of reliable sources. To make it short, I agree with a lot of what Christopher Theodore says above.

This article rightly carries the Numismatics banner on top. It reads like a history of currencies rather than the history of money. I'll return with some proposals, if I may. Take care, all. -The Gnome (talk) 16:17, 13 March 2018 (UTC)

Looking forward to hearing your suggestions! Alaexis_¿question? 14:16, 15 March 2018 (UTC)

Credit does not imply money

Graeber proposes that money as a unit of account was invented the moment when the unquantifiable obligation "I owe you one" transformed into the quantifiable notion of "I owe you one unit of something".

Unless the unit of something owed was a unit of currency, it continues to be barter. And why would anyone bother to be the first to say "I'll give you these five ears of corn for a chip of gold. Now you owe me one chip of gold?" D. F. Schmidt (talk) 12:44, 18 September 2018 (UTC)

It is not barter, it is credit. Why would anyone accept credit? Because it is not harvest time yet. How does credit imply money? When a way is found to make credit transferable (by inventing a unit of account) it becomes money. Wingsail (talk) 02:31, 12 October 2018 (UTC)

how is it not barter? If I trade X for Y (credited or not) and neither of those is a universally fungible resource, it is barter (credited or not). And if transferability is the key thing that qualifies it as money, can the article be updated to drive that home, or would we be relying on original research? D. F. Schmidt (talk) 18:30, 19 October 2018 (UTC)

Barter is simultaneous; I give you something I have for something you have. If one of us doesn't have it we can't barter, we either walk away or try to come to some other arrangement. Credit changes the nature of the transaction profoundly, you can't just wave it away like that. The Credit Theory of Money has its own page already which is fairly good, except in explaining the theory. Transferability (which equates to fungibility) is certainly key and deserves more emphasis in both pages. Wingsail (talk) 02:56, 20 October 2018 (UTC)

how do you claim that transferability equates to fungibility? Just because I have a voucher to buy a medicinal substance does not mean that someone who could take it or leave it will trade something of as great value as someone that desperately needed it. On the other hand, if someone hands me a $20 bill and asks me to exchange it for smaller bills, there is very little reason that he should accept any less than $20 in exchange. I don't feel that credit theory of money does deal with the first time soneone said "you can have a dozen of my eggs today if you give me a metal coin tomorrow". It also doesn't explain why all credited barter automatically implies money. D. F. Schmidt (talk) 06:13, 22 October 2018 (UTC)

Why would anyone want a metal coin? Where would it come from? The first coins were minted ~700 BC, they can play no role in the invention of money which is much earlier. I will try to explain the Credit theory better than its page.

1) Alice has a dozen spare eggs and exchanges them with Bill for a pound of corn. That's barter.

2) Alice has a dozen spare eggs but Bill has no corn until harvest time. He gives Alice an IOU for a pound of corn, redeemable in the future. That is credit.

3) Since Bill has a good reputation in the village Charlie is happy to give Alice a pint of milk in exchange for Bill's IOU. The credit has become transferable.

4) The villagers notice that IOUs would be more useful if they all have commensurable value. They agree that a pound of corn should become the unit of account - the numeraire - then transferable IOUs denominated in pounds of corn will circulate as fungible money.

So far we have a "market"-based system, but it will not extend beyond the reach of personal relations, people will not trust the IOUs of strangers. The historical evidence suggests that this is where the palace and the temple come in - the proto-state. Wingsail (talk) 14:40, 22 October 2018 (UTC)

I should emphasise that this is a gross simplification of credit theory to solely show how money can emerge from credit. Credit theory regards money as a pre-requisite for markets so it cannot emerge from them. Wingsail (talk) 15:27, 23 October 2018 (UTC)

So you're saying that credited barter is part of the history of money but does not imply money, which is exactly what I already said. So where was I wrong? D. F. Schmidt (talk) 23:22, 27 October 2018 (UTC)

Are you replying to me? "Credited barter" is an oxymoron. Wingsail (talk) 20:27, 29 October 2018 (UTC)

I was indeed replying to you, and I disagree, puzzled at the simple dismissive attitude of your response. I suspect this is where we part ways. But for the record, the reason I disagree is simple: If I can trust someone to give me fresh milk tomorrow or next week or next month (that time at which I may require it) for my fresh bread tonight, that is still barter: It isn't a gift, because there is a clear expectation established; it isn't a loan really, because money isn't involved; timing of exchange isn't trivial (or it may be, according to acceptable accounting methods), because they get the distinct benefit of fresh bread and I get the milk I need at some later date; and it's not transferable because I prefer this associate's milk, not the farmer across the road. Sure, only one of us has a product in their hand at any given moment, but to say credited barter is an oxymoron is, I think, equivalent to saying that if we don't execute the entire change in one interaction, there is no exchange at all. And saying that the first time such a thing ever happened is the origin of money is ridiculous (which is what Graeber said according to the quote I pulled from the article). Money simply made such transactions more convenient and more transferable (fungible as money is). D. F. Schmidt (talk) 04:52, 31 October 2018 (UTC)

Exchanging goods for an IOU is not barter. You are making up your own definition so you can equivocate. Wingsail (talk) 15:29, 1 November 2018 (UTC)

The rigid definition of barter you're going on would say that if I agree to give you a cord of wood that isn't yet loaded on a trailer (and you can't carry away in one armload) in exchange for clothing, that isn't barter because you're not ready to walk away with it at that same moment. But you probably would say that's barter, right? Even though the only thing you have to do is go home, get your trailer, come back, and load it up with the cord of wood, and take it right on home? Tell me about how it makes a world of difference if the interval of time elapsed is one night's worth of hours?

But okay, let's go with your assertion that it's not barter and instead that I'm equivocating. What is the word you would use for time-separated transactions like this? --Oh, never mind. You said earlier that the word is credit, something which in this case has nothing to do with money. D. F. Schmidt (talk) 22:49, 10 November 2018 (UTC)

If you have the cord of wood it becomes mine as soon as I give you the clothes, even if I don't take it away immediately. If you don't have the cord of wood you can't barter it. This is not so hard to understand, if you want to. Wingsail (talk) 19:41, 14 November 2018 (UTC)

If their is a source for Graeber claiming this is how money developed then it should be included - perhaps explicitly stating that it's Graeber's theory. What do the other sources claim on this matter? Jonpatterns (talk) 10:56, 22 October 2018 (UTC)

The theory is not original to Graeber. The Credit theory of money article has other sources. Wingsail (talk) 14:36, 22 October 2018 (UTC)

Thanks, I'll look into the sources. First, I'm going to research John Law a little and try to sort out the Monetary Economics article. Jonpatterns (talk) 20:51, 29 October 2018 (UTC)

Few have a kind word for John Law, some even think he was a conman which seems unlikely to me. [6] archaic orthography unfortunately. Wingsail (talk)

Ideological neutrality

I have taken it upon myself to modify the opening paragraph to remove what I perceive as ideological bias. I have also added a sub-section alerting the reader to the ideological tension inherent in this topic. This may deserve a box of some kind? I am largely in agreement with the comments of Vilhelmo and Christopher Theodore above and, in lieu of wholesale neutralising, I think some sort of heads-up is warranted. Wingsail (talk) 18:28, 21 October 2018 (UTC)

The sub-section was inserted into the middle of the lede. Note the lede contains of several paragraph (which is probably too long). The section 'theories of money' would be better treated as its own article. Both the theory and history of money are quite involved - and although there is overlap they will be more clear as separate subjects (see below).

I have no problem with removal of bias in the article, as long as references are provided. Jonpatterns (talk) 11:25, 22 October 2018 (UTC)

I have removed the emphasis on medium of exchange, which is a feature of the commodity theory, from the opening paragraph. Credit theory regards unit of account as more fundamental and I don't think we want to have to reiterate the whole of the functions of money page here just to maintain balance. Wingsail (talk) 14:32, 23 October 2018 (UTC)

Split proposal

Theories of money would be better treated as its own article. Both the theory and history of money are quite involved - and although there is overlap they will be more clear as separate articles. Jonpatterns (talk) 11:25, 22 October 2018 (UTC)

The purpose of this addition is to contextualise the rest of this article. It can't do that if it is not in it. Wingsail (talk) 12:59, 22 October 2018 (UTC)

The lede should contextualise the article - so may be the content should be merge into the rest of the lede.

The articel money is also missing a theories of money section - although it is partly covered by the forms of money section. Jonpatterns (talk) 13:44, 22 October 2018 (UTC)

I meant it to be a sub-section of the lede, if there is such a thing. I have no problem changing the formatting, perhaps just removing the heading?

As to the money article, my impression is that its denizens are somewhat resistant to de-ideologification. Wingsail (talk) 14:31, 22 October 2018 (UTC)

I've found the article on theories of money (its covered by monetary economics). I've moved most of the lede into an overview section - and made your section a subs-section of that. It would be great if some references were added.Jonpatterns (talk) 19:34, 22 October 2018 (UTC)

I've added citations. I don't think the monetary economics link actually adds any value, it's mainly a list of money related topics, most of which have little to do with the theory or history of money. Wingsail (talk) 01:06, 23 October 2018 (UTC)

Although the article is quite poor, monetary economics is the study of theories of money, and 'Theory of money' redirects there. That article is absolutely (or should be) to do with theories of money and the history of theories of money. Jonpatterns (talk) 18:56, 23 October 2018 (UTC)

That's not what monetary economics means to me, but I guess from the amount of random stuff put under its rubric its definition is flexible. Wingsail (talk) 19:18, 23 October 2018 (UTC)

What is your definition of monetary economics? Jonpatterns (talk) 09:15, 24 October 2018 (UTC)

Economics (theorising, modelling, mainly macro) which includes money, banks and credit. Much of economics doesn't, claiming that money is neutral, banks are merely intermediaries, and credit is net zero and therefore of no account. So monetary economics is economics with money, not economics about money. But economics about money has to be called something and if you don't believe in economics with money I suppose monetary economics looks like it is available. Wingsail (talk) 17:11, 24 October 2018 (UTC)

Thanks for the reply. If I get time I will see if I can dig into the historic meaning of monetary economics. Jonpatterns (talk) 18:34, 24 October 2018 (UTC)

Cuneiform Accounting

I would like to draw all editors attention to this article by Tim Harford -- who writes the Financial Times's Undercover Economist column -- which summarizes Julius Jordan & Denise Schmandt-Besserat work.

Julius & Denise are the 2 main players in anthropology involved with early forms of cuneiform accounting and clay tokens used as money.

https://www.bbc.com/news/business-39870485 — Preceding unsigned comment added by ChristopherTheodore (talk • contribs) 21:02, 5 February 2019 (UTC)

Very nice. Here's one that offers some more context (in order to trash a book) https://www.counterpunch.org/2016/07/15/a-travesty-of-financial-history-bank-lobbyists-will-applaud/ Michael Hudson is an economist and a founding member of ISCANEE (International Scholars Conference on Ancient Near Eastern Economies), an international group of Assyriologists and archaeologists that has published a series of colloquia analyzing the economic origins of civilization. Wingsail (talk) 00:57, 10 February 2019 (UTC)

Cryptocurrency - noteworthy properties

It seems worth pointing out some of the properties of cryptocurrencies that seem to be unique in the history of money. I am not adding these yet, because I'm not knowledgeable enough about the history of money to know if these are actually unique. Please weigh-in if you have such knowledge.

- Cryptocurrencies may be the first instance in history of a money being adopted that has zero non-monetary value (even paper money has monetary value, e.g. burning it as fuel), yet it's value isn't imposed or bootstrapped by any state or external power or mandate. Put differently, they may be the first currencies in history to bootstrap value and acceptance without any non-monetary value or authority to seed the bootstrapping process.

- There are anonymous cryptocurrencies, ZCash being the best example, that have "perfect" fungibility. I.e. perfect modulo all audits of the code and all non-classified math available. Physical currency can never have this property, as an instance can always be altered in some way to make it unique. Digital sovereign fiat does not have this property, as any account balance has digital provenance, i.e. a record of all transactions, with counterparty information, from which that balance originated. While this record is not publicly available, there are parties that are privy to it, hence digital balances do not have perfect fungibility to those parties. Wstrong (talk) 17:03, 9 February 2019 (UTC)

It's not obvious to me why a zero value is significant compared to a negligible value. And surely the bits in the bank's computer recording my (non-crypto) balance also have zero value.

Not sure what you mean by "perfect fungibility". If the shopkeeper doesn't care which of the dollar bills in my wallet I give him then they are fungible, whether he knows who I am or not. Wingsail (talk) 01:13, 10 February 2019 (UTC)

Prehistory section - shifting scholarly consensus on the origin of money

Now the Prehistory section is structured as follows:

• Non-monetary exchange
  • Barter: the definition of barter and the assertion that it has never served as the main mode of exchange
  • Hypothesis of barter as the origin of money: hypotheses of Aristotle and Menger, Graeber's critique of them, Murphy and Selgin's critique of Graeber, Smith's critique of Murphy and Selgin
  • Gift economy: the definition and short description of the gift economy
• Emergence of money: an account of the emergence of money with references to (I kid you not!) Maslow of the Maslow's pyramid fame, Marx and Aristotle.

It's hardly a coherent flow. Also, while I respect Aristotle as much as anyone, there certainly has been some progress in the history and anthropology since his times. Now the scholarly opinion has shifted from the barter as the main or sole predecessor to a more nuanced view involving gift exchange, credit, barter and the exogenous money created by the state. See for example the introduction in A Global History of Money by Akinobu Kuroda published in 2020.

I'd suggest to re-organise this section: start with an overview like in Kuroda's book, briefly describing barter, gift exchange, credit and the emergence of state money (thought that might belong to the next section). Finally I would note that historically the dominant view was that of Aristotle/Menger. Would love to hear feedback. Alaexis_¿question? 08:14, 10 October 2020 (UTC)

I am actually more content with this section than with the overview, though it does present a great deal of speculation as fact. The Emergence of Money section is bad. Although the Aristotle quote makes a very important point I think it was put in there for some other reason. I guess everyone wants Aristotle on their side. It needs a more specific ref so I can look it up, I bet he's on my side really. Some of the references seem to be of the "read this book if you want to know what I'm talking about" sort.

I can't find a (free) copy of Kuroda unfortunately, I imagine a non-Western view would be interesting.

Your re-org suggestion sounds good. I did put in a gentle warning about framing in the Theories of Money section. It got a bit watered down with some vague blather about Schumpeter but it's still there. It wouldn't hurt to re-iterate it. Wingsail (talk) 05:18, 11 October 2020 (UTC)

Oh, now that I've re-read the Overview section, I agree with you that it's more problematic. Now the whole thing looks even more daunting. Perhaps it's worth starting with the Emergence of Money section and then to deal with the overview, starting with checking the references. Alaexis_¿question? 07:00, 11 October 2020 (UTC)

I've taken a stab at it. The money of exchange part needs references, maybe Kuroda has something appropriate? Wingsail (talk) 20:19, 12 October 2020 (UTC)

English

The history of money 103.30.198.139 (talk) 08:37, 25 November 2022 (UTC)

bank

original of money 196.249.96.40 (talk) 21:23, 7 December 2022 (UTC)

Macrocompassion (talk) 15:30, 9 May 2023 (UTC)

Value representation of non-intrinsic-value metal and paper and digital money.

In this topic it is written that bank notes (and presumably, subsequent kinds of money) have a certain values. This is incorrect. These forms of money represent value, but these bits of paper and cheap metal discs and the electronic signatures in carefully protected files of money accounts) do not have values by themselves. So that when the money system of a country collapses, this money representative value gets lost.¬¬¬¬ ([[User talk:Macrocompassion]) 15:27, 9 May 2023 (UTC)

You are conflating two distinct meanings of the word. You may propose other wording if you wish. SPECIFICO talk 17:04, 9 May 2023 (UTC)

Money

objectives of money 208.131.188.174 (talk) 18:56, 19 October 2023 (UTC)

Ideological confusion

The article thoroughly mixes several definitions of money, without warning the reader that they come from very distinct and often opposite economic theories. It also gives undeserved weight to some marginal theories, like "Austrian Economics" and Graeber's theory of "Debt money". It should be reorganized and sectioned according to said schools. Jorge Stolfi (talk) 12:05, 17 February 2024 (UTC)

Tally sticks

The article assumes without evidence that prehistoric tally sticks were records of debt. (That is probably taken from Graeber's "money frmo debt" theory.) But tally sticks can be used to count many, many other things. Jorge Stolfi (talk) 12:11, 17 February 2024 (UTC)

The shekel was not a token for barley

The article states that the shekel was "both a coin representing a specific weight of barley, and the weight of that sack of barley." But according to this article, the shekel was a unit of weight for metals, equivalent to about 11 grams -- like the modern "troy ounce". Thus a "silver shekel" was 11 grams of silver, usually in the form of a coin (a round ingot with government seal guaranteeing weight and purity); a "gold shekel" was 11 grams of gold. Neither "represented" anything; their value was the value of the metal. If there was a unit of weight of barley also called "shekel", it must have been a lot more than 11 grams... Jorge Stolfi (talk) 16:29, 17 February 2024 (UTC)

It does seem absurd to claim that barley was worth its weight in silver - or even bronze, copper or iron. That paragraph ends with a citation "Kramer, History Begins at Sumer, pp. 52–55.", but that source makes no such claim. It does mention on page 260 that once, as a result of war, "prices rose so high that a shekel of silver could buy but half a sila of oil, half a sila of grain...", a sila being about half a gallon. This online calculator indicates that half a US gallon of barley would be in the region of 1.1 kg, so in a notably extreme situation, silver was worth 'only' a hundred times its weight in barley. That text was inserted in a large edit in 2017. NebY (talk) 16:57, 20 February 2024 (UTC)

I've removed the sentence since it was not supported by any source. Alaexis_¿question? 20:09, 20 February 2024 (UTC)