Money In Context

Peter Oye Sagay

April 25, 2022

The development of ancient communities into trading communities, brought about the need for a generally accepted medium of exchange and unit of accounting, for the selling and buying of goods and services. Ancient humans addressed this need by inventing money. So, essentially, money was created by humans to facilitate and order their trading activities in their marketplaces. In other words, the word money is the name given to specific objects that can generally be used as a medium of exchange (i.e. to pay for goods and services). Its role as a unit of accounting and as a measure of worth are associated with its basic identity as a medium of exchange, in the sense that transactions recorded and profit made in the marketplace are direct consequences of the buying and selling activities of the marketplace. Over the centuries, various medium of exchange standards were used in ancient marketplaces.

Ancient marketplaces were initially content with trading by barter which is the exchange of goods or services one has for goods or services one wants or needs. Trade by Barter is not a very efficient way of trading in a large marketplace. Buyers often do not have the exact goods or services sellers want as exchange. Moreover, the logistics of the transfer of bulky goods can be cumbersome. Nonetheless, trade by barter can be effective, in a small marketplace where the buyers and sellers have some common interests. This is why some types of trade by barter continue to be popular in some small modern marketplaces. As ancient marketplaces grew, they turned their attention to finding other more efficient medium of exchange.

About 9000 – 6000 B.C, cattle were used as a medium of exchange. In 1200 B.C, cowrie shells were used. Then about 1000 B.C, the first metal money were used in the marketplaces. The metals were primarily bronze and copper. Cowrie shells still held their ground in many marketplaces especially in ancient Africa (the manila, a u-shaped bronze metal was later introduced in West Africa). At about 500 B.C, silver and gold coins were used as a medium of exchange in ancient Lydia (modern Turkey). At about 118 B.C China introduced the leather money made from white deerskin. It was 1ft square and had colorful border. By 806 A.D, China had introduced paper money although it did not sustain it. The concept of paper money came to Europe some years later where it was sustained, developed and spread across the globe.

The growth of international trade necessitated the establishment of the Gold Standard. Trading nations wanted the assurance that a nation’s currency can be redeemed by gold of a specific weight. In 1816 A.D, the Gold standard was made official in England. In 1900, The United States of America established the Gold Standard act, which contributed to the establishment of the central bank. By 1930, the gold standard was retired. In 1944, the Brentton Woods System was established by the US and Britain. The system set exchange rates of the national currencies of participating nations at a specific weight of gold. In 1971, the Brenton Woods System was abolished by the US. The end of the Brentton Woods System marked the end of the formal association of currencies with commodities in the medium of exchange space.

Today, the identity of money continues to evolve. We now have credit cards. Electronic money is being used in limited marketplaces and according to some experts, this form of money will become more wide spread in the coming decades. Nonetheless, the dominant modern concept of money is manifested in national currencies which are controlled by national governments.

The money space was established by humans. When you see money where there are no humans, it is highly probable that humans hid it there, or forgot it there. The evil aspects of human evolution have taken money out of its original context. An original context birthed by pure desires for efficiency in legitmate positive intercommunal trades. Much of this original purity still exist in the money space. Nonetheless, the pollution of the space by reprobate minds, grows exponentially and stinks to heaven.

Money used as a power tool is out of context. Money acquired by force or fraud is out of context. Money in context is devoid of love of money.

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