Currency, the Beginning, the Present, and the Future “Money – in the traditional sense no longer exists. It died two decades ago when Richard Nixon forever abolished the gold standard. Since then, money as we once knew it has been replaced by an unstable new global medium of exchange that is called ‘megabyte money’… megabyte money is a threat not only to our country’s long-term growth and prosperity, but to the individual as well. ” — Joel Kurtzman, The Death Of Money, 1993 Economy when it was first started was a seedling in a field. Poor and helpless to the environment.
As this seedling grows, it becomes stronger and greater as a whole. The great Red Oak that the we as mankind has let it grow up to be is one of the greatest powers driving this planet. This Tree has become the nation? s immense forest and the forest keeps on growing with no end in sight. The thing that makes the economic tree so great, is currency. As America moves into the twenty firsts century at a rapid pace, the currency and economy is moving right along with it. As technology advances more and more the way that Americans pay for things has also changed.
Americans are carrying less and less cash to the stores, but more credit cards and checks. The latest innovation that has come out is the smart chip. But is all this technology going to be the doom of civilization. In this paper the history, the present, and the future of money will be told. In the Beginning the barter was the only way to exchange goods. The barter system is the exchange of resources or services for mutual advantage, and may date back to the beginning of humankind. Some would even argue that it’s not purely a human activity; plants and animals have been bartering for millions of years.
This means that plants and animals have been know to help each other out. In any case, barter among humans certainly pre-dates the use of money. Today individuals, organizations, and governments still use, and often prefer, barter as a form of exchange of goods and services. In twelve hundred BC cowries were first used. This was the shell of a mollusk that was widely available in the shallow waters of the Pacific and Indian Oceans, was in China. Historically, many societies have used cowries as money, and even as recently as the middle of this century, cowries have been used in some parts of Africa.
The cowrie is the most widely and longest used currency in history. By the time 1000 BC bronze and copper cowrie imitations were manufactured by China at the end of the Stone Age and could be considered some of the earliest forms of metal coins. Metal tool money, such as knife and spade monies, was also first used in China. These early metal monies developed into primitive versions of round coins. Chinese coins were made out of base metals, often containing holes so they could be put together like a chain. However some didn? t have access to cowries this lead to the domestication of cattle.
This was used from nine thousand to six thousand BC. Cattle, which include anything from cows, to sheep, to camels, are the first and oldest forms of money. With the advent of agriculture came the use of grain and other vegetable or plant products as a standard form of barter in many. This system however ran into some flaws when there was no set standard on how much anything was worth. About one thousand BC the first coined money was invented. They were bronze and copper cowrie imitations were manufactured by China at the end of the Stone Age and could be considered some of the earliest forms of metal coins.
Metal tool money, such as knife and spade monies, was also first used in China. These early metal monies developed into primitive versions of round coins. Chinese coins were made out of base metals, often containing holes so they could be put together like a chain. Outside of China, the first coins developed out of lumps of silver. By 500 BC the modern coin came around. They took the familiar round form of today, and were stamped with various gods and emperors to mark their authenticity.
These early coins first appeared in Lydia, which is part of present-day Turkey, but the techniques were quickly copied and further refined by the Greek, Persian, Macedonian, and later the Roman empires. Unlike Chinese coins, which depended on base metals, these new coins were made from precious metals such as silver, bronze, and gold, which had more inherent value. In 118 BC leather money was used in China in the form of one-foot-square pieces of white deerskin with colorful borders. This could be considered the first documented type of banknote. However it wasn? t till 806 AD till the first paper bank notes appeared in China.
In all, China experienced over 500 years of early paper money, spanning from the ninth through the fifteenth century. Over this period, paper notes grew in production to the point that their value rapidly depreciated and inflation soared. Then beginning in 1455, the use of paper money in China disappeared for several hundred years. This was still many years before paper currency would reappear in Europe, and three centuries before it was considered common. Precious metals were later used to set a standard for Bank notes. Gold was officially made the standard of value in England in 1816.
At this time, guidelines were made to allow for a non-inflationary production of standard bank notes, which represented a certain amount of gold. Bank notes had been used in England and Europe for several hundred years before this time, but their worth had never been tied directly to gold. In the United States, the Gold Standard Act was officially enacted in 1900, which helped lead to the establishment of a central bank. This however would not last. The massive Depression of the 1930’s was felt worldwide which marked the beginning of the end of the gold standard.
In the United States, the gold standard was revised and the price of gold was devalued. This was the first step in ending the relationship altogether. The British and international gold standards soon ended as well, and the complexities of international monetary regulation began. The complexities and economics of what has happen to the gold standards ending can cause chaos and disruption. However this disruption was minimal, due to the gradual change in the system. The United States was however not perfect in their money system either. In San Francisco during 1965, 1966 and 1967.
Due to the restrictions on coin identification in force at that time, no mintmarks was used. Mintmarks were proof of where the coins were made. Proof coin operations were moved from the Philadelphia Mint to San Francisco in 1968, and the letter “S” identifies that special numismatic coinage. The coinage Act of 1965 prohibited the use of mintmarks for a period of five years. This, together with the date freeze, eliminated distinguishing features on our coins which could tend to cause their removal from circulation during a critical period when the Mint was striving to build up coin inventories.
No mintmarks appear on coins dated 1965, 1966, and 1967. Congressional authorization permitted resumption of the practice in 1968, at which time the mint marks, usually positioned on the reverse of the coins prior to 1968, were permanently relocated on the obverse or date side. Todays currency comes is going over a new make over. The United States quarters are one of the coins that is receiving a face-lift. To commemorate the fifty states the United States is coining a new quarter for each state every ten weeks.
In 1999, the Mint issued: Connecticut (the Charter Oak); Delaware (Caesar Rodney on horseback); Georgia (state outline, peach, live oak sprigs); New Jersey (painting of Washington Crossing Delaware); and Pennsylvania (state outline, allegorical female figure, keystone). A new quarter will be coming out every year until the year 2008. Other Bills like the ten, twenty, fifty, and the hundred dollar bills are beginning modified too. They are getting a bigger portrait and receiving a watermark. This will make it harder to counterfeit and trade illegally. The newest change to the United States currency has been the two thousand, dollar coin.
This coin is a golden color and has Sacagawea on it. Sacagawea was the Shoshoni Indian woman who helped guide the Lewis and Clark Expedition to the northwest. This coin is similar to the Susan B. Anthony dollar that was stopped from making because many got it confused with quarters. With all these changes in the currency, the fact still remains that ninety percent of all currency does not exists. In modern society we are moving farther away from money and closer to a cashless society. A cashless society is a society that has no or few currency. With a cashless society it is harder to steal peoples currency.
This allows for people to keep something with the value of money, but only they can use it. In America the cashless ways of buying things are being changed within a life time. Checks were the first innovation to come out. When this innovation came out, Americans did not have to buy things with cash anymore. Americans sighed a valid piece of paper telling how much they owed and to who they wrote the check to. The security risk of this is, if someone stole the checkbook, they maybe able to forge your signature and take money out of the checking account. This was difficult way of keeping track of what was spent.
Another major disadvantage was that it was hard to keep up with what your balance was. Some would write checks, but they would not have the money to pay for it. This is known as bouncing a check. A new technology must come out to counter these problems. The next thing that came out was the credit card. A credit card is a card that had all your account information on a credit card. This was a system of network computers that was hooked up nation wide. When an item was needed to be purchased, all that was needed to be done was to slide your card through a credit card machine.
This would send the information that was on the account to the network. Then the feedback would come back, to see if the credit card was approved. Finally all that is needed to de done is to sign the receipt. This was beneficial because it was convenient and easy to use. A credit card was also hooked up to a network of computers. This made it harder to steal because when a person found it lost, they could just deactivate the card. Probably the most beneficial factor was that monthly payments can be made. This allowed for people to spend, and only have to pay a little back at a time.
Some people did not like the idea of spending money that they do not have. So a check card was invented. This kind of card can be used exactly like a credit card, but it would withdraw from the checking account. The check card would only allow a person to spend as much as they had. This allowed many to just have one kind of payment and allow for less or no cash to be carried. To make these cards even safer some have put their picture ID on the cards. The newest and the fastest movement in the financial world, is the smart card. Already widely used in Japan and Europe, the smart card is a computer chip inside the credit card.
Smart cards, which resembles ordinary credit cards are capable of storing data, such as banking accounts, medical information, favorite foods, etc. The smart card allows for the card to keep track of what a person buys and make a shopping list from it. This card will notify a person to tell them that they have a low balance. This innovation will make it even harder for a person? s card to be stolen. This technology and the other technology will bring America into the twenty first century and point America towards a cashless society.