Money In History

Money is arguably one of mankind’s most important inventions in history because it connects people. Money (in coin form) has been around for 2,600 years, which isn’t a very long time really. Before coins were invented money was taken in the form of paper, gold, silver, salt, cattle skin and many other objects. Each type of money was used for a different reason; for example, soldiers were generally paid in salt so they could flavor their bland food instead of being paid in something useless like the Parisian singer Mademoiselle Zélie who received animals and food as her payment for performing.

Coins first appeared on what we now know as the Southern Coast of Turkey in 640 B.C.E. These coins were made of a naturally occurring alloy of gold and silver called electrum. It was believed that King Midas had bathed in a river to try and wash away his Golden touch and he disposed a fortune in the river in the process. The Lydian’s who lived there a while on learned how to separate the old from silver and they created coins from the metal. Standardized coins spread throughout Europe and played a large role in it scientific and cultural development. Gold and silver have played a central role in the history of change, they were terrestrial reflections of the heavenly bodies that ruled the skies so it didn’t come as a shock that civilians valued them so dearly. Gold and silver were believed to be natural candidates for coins, they were rare, they do not break down and they don’t rust.

In the world today there is not that much physical gold actually left. In total there would be about a 67-foot cube, which is roughly the size of a small office building. Gold is naturally forming so it cannot be created which makes it a very inflexible subst...

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...d so holding money over long periods of time is guaranteeing you will lose value. It has also been proven that stocks are better as they provide the best real rate of return in every major country in the world. Over the long run, stocks have outperformed bonds and bills by large margins.

The US Federal Reserve and other central banks control the amount of money in the global market and have a large influence on inflation rates. A former chairman of the US Reserve admitted that inflation is a tax and that inflation is here to stay as long as the money supply continues to explode. Between 1948 and 1971 the money supply grew four fold and since 1971 it has grown sixteen fold and is showing no signs of slowing down. Money needs to be planted in assets with the best real rate over time, sometimes putting money into long term savings accounts isn’t the safest option.