The History of Money

Anthropologist Jack Weatherford understands clearly that money is not just a medium of exchange but also “the focal point of modern world culture.” It has changed every culture that has adopted it, eventually overwhelming feudalism and aristocracy as an organizing force in society.

To his anthropologist’s perspective on the effect of money he adds a historian’s facility with detail, tracing the developments of currency through time. THE HISTORY OF MONEY: FROM SANDSTONE TO CYBERSPACE begins in Lydia (modern Turkey) nearly 3,000 years ago when the first coins were minted. Weatherford calls this the first revolution and explains how currency led to the first system of open and free markets, creating a new culture among the classic civilizations of the Mediterranean.

The second revolution arose in the banking system of Italy at the beginning of the Renaissance. It dominated through the Industrial Revolution and eventually led to the modern system of capitalism. Weatherford writes that the invention of banking and paper money changed the basis of organization from heredity to money and the basis of economic power from owning land to owning stocks, bonds, and corporations.

Civilization is now entering the third stage in the history of money, with the rise of electronic money and the “virtual economy.” Weatherford predicts overarching economic, social, and political changes on the same scale as the first two stages. A new global economy is emerging that will increase the role of money in our lives even more, “surpassing kingship, religion, occupation, and citizenship as the defining element of social life.”

Weatherford complements his broad visionary sweep and his substantiating detail with engaging vignettes—Aztec priests throwing a sacrificial human heart on the flames or two men carrying a suitcase of inflated money through the streets of Bolivia to the travel agency to buy a single airline ticket.