Currencies of the World
There is a lot of buzz around news circuits about the devaluation of the dollar worldwide, and a lot of trade pundits are predicting more doom and gloom. So does this mean that the position of the US dollar as the most important currency in the world is threatened? Is a recession really impending and will it drive the US dollar from its coveted top spot? I don’t think there is any immediate fear of that happening but that set me thinking, how did currency come into being? How old is the tradition of paper money and when was the barter system replaced by currency?
While the system of barter (trading or swapping an item with someone who requires it, in return for acquiring something that you need), which was used over centuries had its own obvious limitations. For instance, a vegetable farmer may be willing to offer his produce in return for some tools that another individual is making, but the tool-maker may not, at the time have any need for the farmers produce, and by the time he does, the produce of the vegetable farmer would have been spoiled, so the barter becomes untenable to that extent. So what was then required was to have an intermediate commodity that doesn’t perish and is reliably in demand throughout the year. In earlier times, items of intrinsic value such as copper, gold or wine were used as currency. Early settlers in Australia traded with rum as a currency! Grain and cattle were other items used as and by way of currency.
Even in ancient times, coins were minted by the ruler of the land were stamped with an emblem that guaranteed the weight and value of the metal and used as currency. These were usually made from precious and semi precious metal so that they carried intrinsic value and were stamped with the ruler’s seal thereby imbuing it with an intangible value stemming from authority as well.
The reason for the emergence for paper money was twofold; one, the shortage of precious and semiprecious metal and secondly, ease of portability (soon coins became too heavy to carry around). In Europe the first paper money consisted of paper ‘coins’ issued in Protestant Leyden (today, Leiden) in the Netherlands during the Spanish siege of 1574. Later, governments directed citizens to replace precious metals with paper money to hasten the general acceptance of paper as currency.
Usually currency notes are made by adding cotton paper, linen or other textile fibers so as to make them more resistant to wear and tear. There is also a thin layer of varnish to protect them from soiling. In order to make it impossible or at least very difficult to make counterfeit notes, currency is usually enhanced by a water mark, the thread component and several other factors. Over the years, bank notes have also been printed on materials such as polymer, silk, leather etc.!
So fascinating is the subject of currency, that numismatics is the term coined for the scientific study of currency and its history in all its varied forms and I found this very interesting site devoted to numismatics which gives you access to bank notes from around the world and you can also order any that you want!
