money talks

Money has got a very colorful history, because a number of things have been used in place of what we use as money. Feathers, shells, cloth, salt and so on.

In the beginning, people bartered. Barter is the exchange of a good or service for another good or service.

A bag of rice for a bag of beans. Like this, a bag of apples for one chicken.

However, here comes the problem. What if you couldn’t agree what something was worth in exchang e or you didn’t want what the other person had?

To solve that problem, humans developed what is called commodity money.

Acommodity is a basic item used by almost everyone. In the past, salt, tea, tobacco, cattle and seeds were commodities and therefore were once used as money. In Roman times, Roman soldiers were paid in salt, and that’s how we get the word “salary”, from the Latin sal for salt. However, using commodities as money had other problems. Carrying bags of salt and other commodities was hard, and commodities were difficult to store or were perishable.

Metals objects were introduced as money around

5000B.C. By 700B.C, the Lydians became the first in the western world to make coins. Countries were soon minting their own series of coins with specific values. Metal was used because it was readily available, easy to work with and could be recycled. Since coins were given a certain value, it became easier to compare the cost of items people wanted.

Some of the earliest known paper money dates back to China, where the issue of paper money became common from about AD960 onwards.

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