Money, in its various forms, has been an integral part of human civilization for millennia. From the earliest systems of trade to the digital currencies of today, the evolution of money reflects the dynamic and complex nature of human societies [e81f8cf6].
The article published by AIER, written by Paul H. Kupiec, provides insights into the economic history of the United States and the role of government policies in shaping the financial system. Kupiec discusses the use of various forms of legal money throughout history, including government-issued paper, state and national bank notes, gold, and silver coins. He also highlights the evolution of the Federal Reserve's mission, from assisting the Treasury in financing wars to its current focus on maintaining price stability and delivering full employment. The article reviews the book 'Shock Values: Prices and Inflation in American Democracy' by Carla Binder, which explores the influence of price fluctuations and attempts to manage them on American democracy. Kupiec criticizes the book for oversimplifying and distorting historical events, as well as interpreting past policy decisions through the lens of modern economic theories. He also mentions the ongoing debates within the Federal Open Market Committee (FOMC) regarding inflation forecasts and the neutral rate of interest. While Kupiec acknowledges that 'Shock Values' provides a concise overview of US financial history, he suggests that it may lack in-depth coverage of certain events and perspectives [30bfa628].
Steven Hail, in an article published by The Conversation Indonesia, challenges the conventional story of money evolving from a barter system. Hail argues that the idea of money naturally evolving from barter lacks historical evidence and asserts that money predates markets and was actually invented by governments. Early forms of money served as units of account used to assess tributes paid to early governmental institutions. Hail points out that the need to pay taxes creates a demand for a currency, and government-issued currency holds value because it is required to pay taxes. He also highlights that banks create money through loans, which appear as deposits in bank accounts. Hail concludes that money and markets were created by governmental institutions and legal systems, challenging the notion of a truly free market [fb0097e9].
The recent article published by Ancient Origins provides a comprehensive overview of the evolution of money and currencies. It traces the history of money from its alleged first use around 40,000 years ago to the creation of the first coins in China in the 8th century BC. The article mentions the invention of paper money in China around the 7th century and the introduction of the gold standard in the 19th century, which linked a country's money supply to gold reserves. It also highlights the abandonment of the gold standard by the US in 1971. The article acknowledges the disruptive impact of decentralized currencies like cryptocurrencies and the changing role and usability of money with the advent of open banking and digital wallets [e81f8cf6].
These sources collectively provide a comprehensive understanding of the evolution of money and currencies. They highlight the use of different forms of legal money throughout history, the role of government policies in shaping the financial system, and the challenges faced by policymakers in formulating monetary policies. The sources also challenge the traditional belief that money evolved naturally from barter systems, emphasizing the role of governments in inventing money and the importance of taxes in creating a demand for currency. Furthermore, they discuss the creation of money by banks through loans and the disruptive impact of decentralized currencies and digital technologies on the concept of money [30bfa628] [fb0097e9].