A 10,000 yen bill in your wallet is just paper, but you can use it as 10,000 yen.
In the past, people paid with shells or cloth, and paid with gold and silver by weighing it.
Grasping the History of Money at a Glance
From before the birth of coins to banks and digital payments. We will survey the changes in money through the ages.
Time to read the text: about 12 min ／ Time to read the in-depth book: about 119 min
The review questions are optional and not included in this time.
What you can read: the course opening and contents are free; the full text is for those who have purchased
After purchase, you can read the full text once your access starts.
A 3-Minute Overview of the History of Money
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When cities or kings stamped marks on metal, people could pay just by counting coins instead of weighing them.
What backed money switched from weight to the stamp.
Before coins were born
People traded with shells, cloth, livestock, records of debt, and metal paid by weight.
In the next era, the invention of stamping marks was born.
Empires and the Middle Ages
Imperial currencies covered wide areas, and in the Middle Ages, coins from abroad flowed into Japan.
Round coins became a tool for unification.
The Age of Silver
Silver from the New World crossed the seas and met the demand for silver in East Asia.
Japanese silver also joined the flow.
Banks and National Debt
Deposit receipts became banknotes, and countries began to borrow from banks.
The backing for money expanded to promises on paper.
1816–1913
Using gold as a yardstick, the currencies of various countries were linked together.
The expansion of international trade and good fortune from the earth supported the system.
1914–1971
Wars and depressions destroyed the gold standard, and after the war, currencies were linked to the dollar.
Only the dollar was linked to gold.
1972–
The link to gold was broken, leading to the era of electronic money and Bitcoin.
Today's money is read in the ledgers of banks and central banks.
2In numbers
1971year
The year the exchange of dollars for gold stopped. From here began the era of money disconnected from gold.
3What would you do?
After money was disconnected from gold, what do you think backs the value of banknotes?
Pick one
Still gold
The exchange of dollars for gold has stopped. Banknotes continue to be used without being exchangeable for gold.
Government credit and ledgers
That's right. What backs money disconnected from gold is government credit. Most money has become numbers in the ledgers of banks and central banks.
The old backings haven't disappeared; they still overlap today. Please see Figure 1 in the book for the order of the six backings.
4Read more
What you will understand after this course
- Be able to select one era and explain what was used as money, what backed its value, and what changed from the previous era.
- Be able to trace in order the succession of things that have backed money (the object, the weight of metal, marks, a promise on paper, the credit of the state, numbers in a ledger).
- To be able to read the years at the boundaries of eras not as sharp lines of sudden change, but as periods of transition.
The book for this course
『Grasping the History of Money at a Glance』
A complete illustrated book. 17 figures, about 119 min
More about this course
Course number: A00
Supervised by: Mitsuru Hayama
Beyond the text: 6 exercises · 3 readings How reading times are calculated
You will also understand
- To be able to view eras with few materials not as proof of absence, but by distinguishing between historical gaps and gaps in the available materials.
You can start this course without reading any other course.
If you want to know more about checking sources (optional)
- Is It Really True? Checking History
We re-examine the origins of money and famous anecdotes, comparing them with historical records and actual artifacts.
Assessment
6 exercises in this course (4 check, 0 compare, 2 written). Progress is recorded by self-assessment.
The 8 chapters of this course
- What Has Underpinned Money — Starting with a Single CoinThe backing for the value of money has shifted over time from commodities, to the weight of metal, to official marks, to promises on paper, to state credit, and to numbers in a ledger.
- Before coins, and the first coins.Before the birth of coins, transactions were made with goods or with metal paid by weight. The invention of striking a mark made it possible to pay by counting.
- The money of empires, and the three worlds of the Middle Ages.Imperial currencies covered vast areas, and in the Middle Ages, gold coins, aniconic coinage, and paper money coexisted. Imported coins flowed into Japan.
- Silver circulates the globe, and deposit receipts become banknotes.Silver from the New World crossed the seas and met demand in East Asia. Eventually, deposit receipts became banknotes, and states began to borrow from banks.
- The era of the gold standardWith gold as the standard, the currencies of various nations were linked. The expansion of international trade and bountiful gold discoveries supported this system.
- War, Depression, and the Era of the DollarThe gold standard collapsed due to war and depression. After the war, national currencies were pegged to the dollar, and only the dollar was pegged to gold.
- From Money Severed from Gold, to Digital MoneyThe link with gold was severed, and the center of gravity for the support of value shifted. Today's money is read in the ledgers of banks and central banks.
- How to Read the Grid and Tables — The Cell and the Empty CellThe number in a cell is not the weight of history, but the depth of the material. An empty cell can mean one of three things: "did not exist," "did not survive," or "not yet collected."
Real-life examples in this course (3)
- Before the beginning Overview: the world the 31st–18th centuries BC Mesopotamia
Not barter: clay tablets recording barley rations and loans — the gateway to money before coins. - The weight of being the reserve United States 2008 The financial district on the night of the crisis
In the 2008 crisis, when the world ran short of dollars, the Federal Reserve supplied dollars through other central banks. - Epilogue Overview: the world from AD 2009 Crypto-assets
Bitcoin, which began running in 2009: money that bears no face and tries to rest its value on a system of promises.
Read next
Silver Coins that Crossed the World →What you learn next: You can name three points on the route by which New World silver circled the globe.
Time to read the text: about 8 min ／ What you can read: the course opening and contents are free; the full text is for those who have purchased
Price
After purchase, the full courses, the illustrated books, every country’s story and the numismatics examination are open to you.
See the price →