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Why do we need money?

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This week we have a TPL website visitor who probably has money on their mind.

 

Before coins and bills were developed, people exchanged goods directly. There wasn’t a set value for goods as people bartered. You can think of it as negotiating a trade for Pokémon cards by offering someone POGS (or some other 90’s toy fad) in return. 

 

The first recorded use of money occurred around 1000 BC, when the Chinese made small bronze replicas of knives and tools to use as representations of trade goods. Coins were developed independently in China, India and Greece between 700 and 500 BC. China created the first paper money, currency that was not dependent on its inherent value, in the 11th century.

 

Prior to the 1970’s money was directly linked to gold also known as the gold standard. Since the 1970s money is no longer backed by a physical commodity. 

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