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Money – A Wild Journey Through Millennia

14 minute read

The classic song Money Makes the World Go Round from the musical Cabaret has some truth to it – money truly has made the world spin significantly faster. At least in the sense that a vast array of goods travel the planet thanks to money – goods that we could otherwise only dream about. However, money isn’t only interesting because of the fact that it’s great to have; money has also changed a lot in the past millennia, being one of humanity’s more innovative inventions. Let’s take look at the glinting history of money.

Trade Is Part of Human Nature, i.e. How Did Money Come to Be?

Money is such a natural phenomenon that it has existed in some form since times immemorial. Whether money came to be ten or a hundred thousand or even a million years ago doesn’t even matter that much. What is certain, however, is that when our ancestors discovered that it’s pretty great to own things, they also gained the need to peacefully exchange items from time to time – people really couldn’t be bothered to wage war all the time.

It is presumed that money came into existence due to man’s inherent instinct to do trade. Imagine that you’ve just baked some fragrant loaves of bread over hot stones, but the chilly autumn wind makes you shiver. At this very moment, a tired huntsman walks out of the forest, carrying some hide. He can smell your delicious bread. No doubt both parties will instinctively want to trade. So, you see, trade has existed in some form or other since the early days of humanity. Meat for arrowheads; an axe for beads.

But what happens when it’s a hot summer day and you don’t really want those hides, contemplates author and co-author at Wired David Wolman in his book The End of Money. In that case, you’re likely to accept something valuable for your bread – something that allows you to buy hides four weeks or even four months later. This “something valuable” is money – say in the form of pretty cowry shells. So now when you took a day’s hike to a neighboring village to buy a new axe, you no longer had to drag along a cow. You’d sell that cow in your home village and buy the axe for the shells you received for the cow.

Over time, a number of things have taken on the role of money – cattle, salt, feathers, hides, shells, coconuts, butter, whale teeth, cocoa seeds, tobacco leaves, etc.

Another thing people soon realized was that you can’t do everything – hunt, build a house, grow crops, etc. – equally well. People began to specialize. Doctors began to cure the ill, firemen began to put out fires, cooks to cook food. Specialization boosted the economy significantly and the importance of money and trade grew.

The former mythical money (shells, stones, claws, etc.) that used to grant the owner special magical powers, was replaced by value-based money, i.e. payment money, that was valuable because of the material it was made of (e.g. gold and silver). From there, it was only a small step to money becoming a medium of exchange (paper money and bank cards, where the piece of paper or plastic has little actual value). Nowadays it seems a given that money takes on several forms – cash, credit and debit cards, gift certificates, wristwatch-like devices that you can use to buy a cocktail while lounging in a pool at a spa, cryptocurrency, etc.

Nobody knows why gold once became the synonym of money and wealth. It’s likely that finding a glinting piece of gold was just something very special for our ancestors. Why else would the Incas have dubbed gold the “sweat of the sun”? Granted, the precious metal was an excellent exchange method – it doesn’t decay, burn or kill you with poisonous fumes.

But long before gold coins, money used to be made from a very common material – clay. 4,000 years ago during king Hammurabi’s reign in ancient Babylon, clay tablets were used the same way we now use cash and bank cards.

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