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Who actually invented money?

  • Rush
    Rush Vermögenstracker e.U.

In order to get to the bottom of the question of the creation of money, we should perhaps first clarify:

What is money?

In our everyday lives, money in the form of coins or bills acts as a medium of exchange for other goods. Simply put, we go to the supermarket, for example, and we exchange our money for food.

If we look at it in this way, it also quickly becomes clear where money originated and that there was not one inventor. Some time ago, a lively barter trade of goods was the order of the day, so there were no coins and no bills. People traded by exchanging one good for another. For example, flour for eggs. It seems only logical that people used to trade things they had enough of for things they didn't have enough of. And despite the fact that goods varied greatly from region to region, there was one thing that quickly became widespread as a valuable medium of exchange: salt. Salt was especially important for preserving other foods.

In addition to food, many other objects were said to have a special, magical effect, for example amber. One object that was mentioned as a means of payment as early as 2000 BC in China and was still used as such until the 18th century is the kauri shell. In the course of time, individual peoples began to make objects of metal, these were small figures, for example, in the form of a fish.

The first actual coins were made in the area of today's Turkey. The peculiarity of coins is that they are not assigned an individual value depending on the observer. Coins have a uniform size and weight, and until the time of the First World War it was common that the material from which the coin was made actually had the value of the coin, the metal value was equal to the nominal value. Later, coins were also made of inferior metals, so that the metal value no longer corresponded to the nominal value.

For a variety of reasons, but one was certainly the weight and associated practicality of coins, different paper currencies developed. Of course, with paper money, the nominal value does not usually equal the material value. To prevent a loss of value of paper money, many currencies around the world have always had the gold standard. In doing so, the money-printing body ensures that the claim to gold that arises with the printing of the currency could also be covered by having the amount of money on hand also in gold. However, with the idea of fueling economic growth, the standard was usually dropped after a while so that more money could be printed.

So much for our little history lesson. Of course, there were many more stops on the timeline here. But since we're constantly talking about money in some form here, it's certainly not a bad idea to understand the basics.