Money 2
The use of money began in the sixth century B.C. in what is now western Turkey, when lumps of gold found in rivers were melted and turned into pieces of uniform size imprinted with a stamp. For almost all of the time since then, the common monetary system has been commodity money, whereby a valuable commodity (typically a metal) is used as a widely accepted medium of exchange. Furthermore, the quantity of money was not under anyone’s control; private agents, following price incentives, took actions that determined the money supply.Today, the prevalent monetary system is that of fiat money, in which the medium of exchange consists of unbacked government liabilities, which are claims to nothing at all. Moreover, governments have usually established a monopoly on the provision of fiat money, and control, or potentially control, its quantity. Fiat money is a very recent development in monetary history; it has only been in use for a few decades at most. Why did this evolution from commodity money to fiat money take place? Is fiat money better suited to the modern economy or was it desirable but impractical in earlier times? Were there forces that naturally and inevitably led to the present system?
. . .
Some common words found in the essay are:
, Milton Friedman, Middle Ages, Antonio Tesauro, Aristotle Ethics, fiat money, price level, commodity money, system fiat money, purchasing power, monetary system, system fiat, medium exchange, market value, Monetary Stability, purchasing power coins, fiat currency, melt existing coins, silver content, external limit amount, money fiat money,
Approximate Word count = 1187
Approximate Pages = 5 (250 words per page double spaced)
|
 |
