Paper, Rocks or Digits: What Makes the Best Money?
What makes the best money? I've been reading a number of books recently on money. Money the unauthorized biography by Felix Martin and money the true story of a made up thing by Jacob Goldstein. Both of these books have examples of different types of money that's been used in the past. Fascinating examples that you might not be aware of. and. We WanNa look at them and think about what is it? That makes something money. Money evolves and has evolved and will continue to evolve in what we used as money today might be very different decades from now. The first example is from the island of Yap. This is an island in the Western Pacific part of the Caroline Islands. It is now part of the Federated States of Micronesia. The people of the APP lift on the run over separated from other cultures for many many years. We'll in one, thousand, nine, three, an anthropologist who had also been trained as a medical doctor from new. England William Henry Furness went to Yep for two months and studied this people. And it wasn't a very advanced economy with. Three products, fish coconut and sea cucumbers, but they had something unique that they used for money. Furnace describes his money as large solid thick stone wheels ranging in diameter from a foot to twelve feet. Having the center a whole varying in size with the diameter of the stone wearing a poll may be inserted sufficiently large and strong to bear the weight and facilitate transportation. This was their money. It was called FAE. FBI are also it's called why are? The money was quarried in an island three hundred miles away babble up. And then it was transported on rafts towed behind canoes that had sales on them. Took a lot of effort to get this money. When furnace I saw it. He realized this really heavy and wrote when it takes four strong men to steal the price of a pig burglary cannot but prove a somewhat disheartening. These things were so big and heavy, you couldn't steal them. But then he observed as transactions took place that these stones were He wrote the noteworthy feature of this stone currency is that it is not necessary for its owner to reduce it to possession after concluding a bargain which evolves the price of a fe too large to be conveniently moved. Its new owner is quite content to accept the bare acknowledgement of ownership without so much as a mark to indicate the exchange, the coin remains undisturbed on the former owner's premises. In fact, there was one family furnace pointed out where the stone was lost from where it was quarried and had been several hundred feet at the bottom of the ocean for several generations. Yet the family that owned it everyone recognized that they still on that and that they were wealthy. Furnace wrote the purchasing power of that stone remains therefore as valid as if it were. Visibly, against the side of the owner's house and represents wealth as potentially as the horrid inactive gold of a miser in the middle, ages or as our silver dollar stacked in the Treasury in Washington which we never see or touch but trade with on the strength of a print certificate that there there. Is. The belief that it had value. Felix Martin wrote money was not the fe but the underlying system of credit accounts and clearing a which they help to keep track. The Fe would just tokens which these accounts were kept. They had an accounting system that tracked the trading of fish and sea cucumbers. And they would have outstanding balances and sometimes they will set up and maybe they would move the fe but often times they wouldn't. But there was the record that was there. Peter Bernstein in his book the power of Gold History of an obsession wrote the FE of Yep we're stores of. Wealth. Stores of wealth. Sit. Money moves it travels from one pocket to another. A store of wealth is mass. It was the transactions, the accounting record, and the trust between the participants that form their monetary system. The stones were a store of wealth, but we're just some tokens. The first documented use of money is from Sumer around thirty five, hundred BC. This is in southern, Mesopotamia. There were vast temple palace complexes there with thousands of crafts people farmers. Shepherds, bureaucrats. and. They wrote on clay tablets in cuneiform script and they wrote contracts evolving the workings of the temple debts owed rents. Effectively. It was money because it was an accounting record and you would have accounts receivable that you could trade. David Graber who recently passed away in his book debt. The first five thousand years wrote the value of a unit of currency is not the measure of the value of an object, but the measure of trust in other human beings.