Rated G, highly educational and entertaining, you'll learn how the US Dollar is created out of thin air, how ALL fiat currency ultimately fails, just like a ponzi scheme, the difference between MONEY and currency, and what money actually is in reality. You'll also learn about the Federal Reserve, Bonds, Treasury Notes/Bills and other monetary instruments in a way that's easy to understand, unlike the purposely obscured information out there about your money.
The reason I posted this is, you can't fully appreciate what is presented in this post without knowing the basics.
The post explains Carl Menger's regression theorem from 1871 which demonstrates that money arises through voluntary market processes rather than state creation. It begins with the limitations of barter economies where participants face the double coincidence of wants problem such as a blacksmith needing grain but finding the farmer uninterested in horseshoes. Certain commodities including cattle salt shells and precious metals gain wider acceptance due to properties like durability divisibility portability and recognizability. Traders converge on these goods organically without central authority. Money's value traces back through exchanges to its original commodity utility with gold for instance first valued for jewelry and industry. Governments later monopolized these systems. Real world examples from Venezuela Zimbabwe and Lebanon show people adopting alternatives like cigarettes rice or Bitcoin when state currencies fail illustrating how markets route around monetary breakdowns to enable economic coordination.
I gather that anthropologists do not believe that barter necessarily preceded money. It is now seen as more of a rationalisation that has come from hindsight.
Take the example in the post about farmers and blacksmiths. It ignores how a farmer could have acquired his farm and seeds while it is also not explained how the blacksmith shop was founded.
I think that before there was money, people would just have helped each other out because that was the only way they could get along. They would all go hunting together to catch the next meal. For example, it would not have been down to one person to hunt who then had an expectation of swapping his catch for something he wanted later on.
Anthropologists argue that the idea of a pure barter economy preceding money is a historical myth with no empirical evidence in human history. Research into modern and historical small-scale societies shows that exchange systems were typically based on gift economies, redistribution, or credit, rather than spot-trading.
Origin of the Myth: The narrative was popularized by classical economists like Adam Smith as a theoretical model to explain the efficiency of money, not as a documented historical reality.
Actual Pre-Monetary Systems: Communities relied on socially embedded reciprocity (gifting) or institutional redistribution (e.g., temples or palaces collecting and distributing resources).
When Barter Occurred: Anthropologists observe that barter typically appears only in societies with existing monetary systems but scarce currency, or between strangers and enemies who do not share social ties.
Consensus: Experts like Caroline Humphrey and David Graeber note that no ethnography has ever described a "pure" barter economy from which money emerged; instead, money likely originated as a unit of account for taxation and state administration
I am going to step out of the gold pond momentarily. Money is worth what you can buy with it. And more specifically what people believe they can buy with it if they accept the money in trade. As such, confidence plays a role. Gold is one form of confidence, but there can be several forms. Even, no other option.
Agreements can also enter the picture. If a vendor doesn’t take a type of credit card or a type of crypto or foreign money, then they become temporarily worthless.
On the other hand, if silver and gold are accepted as a storage of value, that value determined by 2 parties in an exchange, then you have the most honest money to be found. I can trade eggs for meat, or firewood or sugar if the other has the commodity i need. With silver or gold thst valuebisbstoredbuntilbyoubfinsld someone with what you need willing to trade/sell.
Required Watching:
Mike Maloney - The Hidden Secrets of Money
Rated G, highly educational and entertaining, you'll learn how the US Dollar is created out of thin air, how ALL fiat currency ultimately fails, just like a ponzi scheme, the difference between MONEY and currency, and what money actually is in reality. You'll also learn about the Federal Reserve, Bonds, Treasury Notes/Bills and other monetary instruments in a way that's easy to understand, unlike the purposely obscured information out there about your money.
The reason I posted this is, you can't fully appreciate what is presented in this post without knowing the basics.
The post explains Carl Menger's regression theorem from 1871 which demonstrates that money arises through voluntary market processes rather than state creation. It begins with the limitations of barter economies where participants face the double coincidence of wants problem such as a blacksmith needing grain but finding the farmer uninterested in horseshoes. Certain commodities including cattle salt shells and precious metals gain wider acceptance due to properties like durability divisibility portability and recognizability. Traders converge on these goods organically without central authority. Money's value traces back through exchanges to its original commodity utility with gold for instance first valued for jewelry and industry. Governments later monopolized these systems. Real world examples from Venezuela Zimbabwe and Lebanon show people adopting alternatives like cigarettes rice or Bitcoin when state currencies fail illustrating how markets route around monetary breakdowns to enable economic coordination.
SOURCE: https://x.com/Handre/status/2066115936093102430 SOURCE (mirror): https://xcancel.com/Handre/status/2066115936093102430
I gather that anthropologists do not believe that barter necessarily preceded money. It is now seen as more of a rationalisation that has come from hindsight.
Take the example in the post about farmers and blacksmiths. It ignores how a farmer could have acquired his farm and seeds while it is also not explained how the blacksmith shop was founded.
I think that before there was money, people would just have helped each other out because that was the only way they could get along. They would all go hunting together to catch the next meal. For example, it would not have been down to one person to hunt who then had an expectation of swapping his catch for something he wanted later on.
If they believe that, they are idiots.
Barter HAD to precede money, as there would be no need for money -- or even the concept of money -- until barter became difficult.
This is their reasoning as supplied by Brave AI:
Anthropologists argue that the idea of a pure barter economy preceding money is a historical myth with no empirical evidence in human history. Research into modern and historical small-scale societies shows that exchange systems were typically based on gift economies, redistribution, or credit, rather than spot-trading.
I am going to step out of the gold pond momentarily. Money is worth what you can buy with it. And more specifically what people believe they can buy with it if they accept the money in trade. As such, confidence plays a role. Gold is one form of confidence, but there can be several forms. Even, no other option.
Agreements can also enter the picture. If a vendor doesn’t take a type of credit card or a type of crypto or foreign money, then they become temporarily worthless.
On the other hand, if silver and gold are accepted as a storage of value, that value determined by 2 parties in an exchange, then you have the most honest money to be found. I can trade eggs for meat, or firewood or sugar if the other has the commodity i need. With silver or gold thst valuebisbstoredbuntilbyoubfinsld someone with what you need willing to trade/sell.