What is Money?

I’m sure in simple terms, you might say

‘Money is considered a medium of exchange, that is generally accepted for facilitation of the transaction of goods and services. It can also be used as a store of value for counting wealth. Money may take a physical form as in coins, notes, or precious metals, or may exist in a written or electronic account. ‘

Everyone is very familiar with definitions like these, which may or may not be right. That's not what's important, my point here is this, Money was invented before written history began, so any story of how money first developed is mostly based on conclusions made from incomplete information. Hence, the definition of money or should I say, what you know money to be, has evolved.

The most significant evidence points to many things being exchanged for others, which of course you know as ‘trade by barter’ which included things directly useful in themselves like livestock & grains, and also merely attractive items such as cowrie shells or beads which were exchanged for more useful commodities. However, the common battering of a particular commodity didn't exactly mean that commodity was seen as money. Now Let's take a more in-depth look at something else that was used throughout Africa as a currency.

Cowrie Shells

Now you might wonder? How did a cowry shell that is seemingly ‘unattractive’ become a currency to be used for trades? What gave it the Value?

I'll tell you…

The thing about the cowries being used as a form of currency throughout Africa, Asia, Europe, and Oceania for trade as early as the 14th century on Africa’s Western Coasts wasn't because of how small it was, or how portable, or the fact that it was almost impossible to counterfeit, but rather because it represented Power. As a matter of fact, in the 16th century, Europeans were able to enter the Valuable African Trade Markets using cowries to buy goods, including people. So one of the things that gave it value was the fact that it represented Power. Power to enter the Rich African trade markets for the Europeans and as well as Power for Africans as they were used for protective charms in amulets, they often appeared on clothing, spirit bundles, or jewelry in America as a talisman to resist enslavement.

The Evolution of Money

Due to the complexities of ancient history and ancient civilization developing at different paces, and their inability to keep accurate records without having them destroyed, the true origin of money invention can't be properly traced. However, evidence in history has supported that money has taken two main forms ;

Money of Account (debits & credits on ledgers ) &
Money of Exchange (tangible media of exchange from clay, leather, paper, bamboo, metal, etc )

Money of Account has to do with the different transformational periods of keeping accounting information of money from trades carried out, which I believe was the oldest compared to Money of exchange.

Money of exchange on the other hand was the real gem. Remember, this is a series from ‘Money as an Agenda ‘.

So Money of exchange was where the grand idea of representing money with something that had no value on its own came from.

Remember, some goods or in this case, commodities don't necessarily mean money but could still be traded for other commodities. So, creating an item while having the same value of goods or commodities stored to represent the amount of that particular item that was to be used for trade or exchange meant, another form of money was introduced.

I mean, money is just a means of exchange after all… right?

Did you catch that?

Hence, a new form of money was introduced into the trade by barter system.

I'll explain further…

In the ancient empires of Egypt, Babylon, India, and China, the temples and palaces often had commodity warehouses that used clay tokens and other materials as evidence for a claim upon a portion of goods stored in the warehouses, even though there's hardly any evidence suggesting these tokens was used for trades, they were however, used for administrative and accounting purposes, which isn't far from our assertion, that the item had no value on its own but was used to represent things of great value, and in extension, can be used to ascertain wealth stored too(accounting)… sounds familiar? Hold that thought.

Now let's quickly look at the ‘autonomy’ of some of the first leaders to think of this idea and bring it into fruition;

In ancient Egypt, the Pharaohs were considered divine intermediaries between the gods and Egyptians. The Pharaohs made laws and oversaw all the lands in Egypt as they were owned by him and collected taxes.

Another case was that of the Babylonian Empire under the rulership of King Hammurabi, the greatest King in the history of Babylon. After conquering neighboring city-states, brought much of the Southern and central Mesopotamia under a unified Babylonian rule, creating an empire called Babylonia, afterwhich he then proceeded to create the ‘Code of Hammurabi ‘, a collection of 282 laws and regulations carved into stone. Historians do describe these laws as a governing principle for ancient Mesopotamia as a way of solving disputes, punishing crimes, and getting justice for her people, as well as a way of regulating business practices. An in-depth study will allow you see and understand how some of these laws are still active in some of our countries today. I’ll share more about this in later parts to come on our series ‘Money as an Agenda’.

One more is that of Chandragupta in the Mauryan Indian Empire where Chandragupta, after unifying much of India, along with his counselor Chanakya, passed a series of major economic and political reforms( verb. make changes in (something, especially an institution or practice) in order to improve it. ) The Mauryan rule was a strong structured administration with Chandragupta making Patna the central unit for his reign and rulership. This man was known to be the grandfather as well as the one who started the Mauryan empire and passed it to his son who then passed to his grandson, Ashoka, the strongest ruler of the Mauryan empire up till date. The Mauryan Empire was the largest empire ever to exist on the Indian subcontinent.

As we have established from history, these rulers had the power to make and un-make laws… just like our government today.

You might say it's different because we now have a democratic society. You're probably right with that thought, not the one with the ‘democratic rule’ - talk, but the one with the ‘we’re just getting started, best not to get ahead of ourselves’ - talk.

I'll show you more…

Next?

Let's talk about the usage of metals. This was how the barter system slowly gave way to the new forms of money of exchange and gave rise to what you now know as notes.

This is the evolution of Money and as usual, My name is Clever Abaribote. I'll see you in the next part of the series

‘Money as an Agenda’. 02.

Metals as the New Currency.

to be continued…

Sources ;

Wikipedia.com, National Museum of African American History & Culture, nmaahc.si.edu, National Geographic Society, History.com