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The History of Paper Money - I: Origins of Exchange - Extra History (Patreon)

Published:
2016-09-30 06:39:05
Imported:
2026-06
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New episode of Extra History!

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The History of Paper Money - I: Origins of Exchange - Extra History

Giant stones sunk under the sea? Cows? Cowrie Shells? What do they all have in common? They were all money. Find out how we got from exchanging these things to doing 8 hours of work for a stack of paper that takes 2 seconds to print on The History of Paper Money. (--More below) Support us on Patreon! http://bit.ly/EHPatreon Grab your Extra Credits gear at the store! http://bit.ly/ExtraStore Subscribe for new episodes every Saturday! http://bit.ly/SubToEC Play games with us on Extra Play! http://bit.ly/WatchEXP Talk to us on Twitter (@ExtraCreditz): http://bit.ly/ECTweet Follow us on Facebook: http://bit.ly/ECFBPage Get our list of recommended games on Steam: http://bit.ly/ECCurator ____________ ♪ Get the intro music here! http://bit.ly/1EQA5N7 *Music by Demetori: http://bit.ly/1AaJG4H ♪ Get the outro music here! http://bit.ly/23isQfx *Music by Sean and Dean Kiner: http://bit.ly/1WdBhnm

Comments

Thomas Joseph

Curious as to whether or not you'll be mentioning or at least referencing Karl Polanyi's "Great Transformation," notably his ideas on fictitious commodities, since it seems to be where the next episode is heading. Unless that's a spoiler.

Stormy Weather

Salt was also a huge early currency since it was hard (ish) to get and could be used for such a variety of purposes^_^

Marco Honrade

How long will this series be? It sounds like you guys basing this off the traditional story on the history of money. Right now I'm reading "Debt: The First 5000 Years" by David Graeber. Interesting how he argue that debt and credit not trade is the origin of complex economies and that money arose from debt rather than visa versa.

QuakeRiley

I seriously hope you mention the Knights Templar.

John Brewer
>>2660436

I was hoping somebody would mention Graeber's work here. Here's an awful lot in his book that is questionable, but his assertion of that that barter economies represent a failure mode of currency economies rather than their predecessor is one of his strongest theses.

John
>>2660436

+1 on the debt; however, it was backed up by something physical to start with. So one could think of debt as an abstracted physical thing or an IOU for that thing/fraction thereof; therefore the story of debt is also the story of the thing.

Marco Honrade
>>2660436

It's a compelling theory that money was created to make debt quantifiable and transferable; and the state was created in turn to enforce debt obligation through law and the military. I don't entirely buy his arguments: His arguments are somewhat anecdotal. However, it is an interesting theory on the development of civilization and money, The problem these grandiose theories on civilization that somehow we can categorize all of human existence into a one size fits all box.

shadowscribble

I hope you talk about our current evolution to money becoming entirely non-physical.

Christian Jensen

I stumbled upon something quite interesting when during research for a university project a few years back. The notion of the barter economy (trading goods for other goods) originate mostly from Adam Smith and 'The Wealth of Nations', as well as the idea that the barter economy is the both the first stage and the precursor for currency. However, some anthropologists have found evidence that suggest that in some primitive societies that do not barter and trade, an economy based on the giving of gifts acts as a way to get goods and services spread around.

Nessf

Canadian here - just as a point of interest, our monopoly money has been polymer banknotes for around five years now. Works great, apart from a couple of instances of bills melting when someone forgot to take them out of their pants before running them through the dryer.

Jorlem
>>2662450

So, the idea of IOUs or trading favors, instead of immediate barter of goods in hand?

Christian Jensen
>>2662450

I am not really sure of the exact details, since it was a bit of a tangent to what I was working on, but as I understood it, it was more like an 'ethical economy', where you give to others, in assurance of recieving when you are in need yourself. More systematic than transactional, and probably mostly focused on subsistance.

Jim McGeehin

There's another critical quality of commodity money that makes it work: fungibility. When a good is fungible, it means that it can be swapped out for itself with little loss. That's what made metals so worthwhile is that gold is gold, and 3 ounces is 3 ounces, whereas manufactured goods can be of different quality. Even those limestone wheels of Yap can be exchanged for another limestone wheel of equal weight, and thus, the commodity good can preserve its value. This in turn meant that value of the good directly correlated to how much of it there was, so value became a function of mass. Common methods of coin debasement involve removing the precious metal from the coin in question, and either replacing the weight or hope no one weighed it and accepted the currency as of the proper weight, and why trusted, calibrated scales were a valued commodity in the precious metal-backed economies. While shaving is a typical and common practice, one of the more humorous ones was to "sweat" the coin, by putting a bunch in a pouch and shaking it to collect the gold dust. This practice didn't yield much, but it was harder to detect than shaving. Fungibility leads into the next quality of money that's essential: malleability. When it comes to larger governments that need to control how much currency is in circulation, it becomes essential to be able to make the precise amount of currency required to be in circulation as easy as possible. This is why gold and silver were so valued. As soft metals, they were easy to mill ingots into sheets, stamp out planchets (blank disks ready to be struck by the die to become coins), then the hole-filled sheets could be melted and reforged into ingots to begin the process all over again.

Kevin Kerkhoff

I must say I really like the suit and bow tie on Dan.

Kathyrne

Okay, a Doctor Who reference followed by a Superhero reference?!!? Y'all get a tripple-A Supah Kitty Hug for this episode!!

eLNeroDiablo Studios
>>2662068

As an Australian, we've had polymer "plastic" banknotes in general use since 1992, though our first polymer note was a $10 note issued in 1988 on the bicentennary (200 years) of Australia's founding by the British.

Forrest Venable
>>2662450

I think it was more like how a family works. The person caring for the children doesn't charge the person growing food or whatever, but rather everyone cooperates and does what they can to help out. If someone is particularly helpful and you weren't able to do much, you might do something special for them to even things out.