Money - Wikipedia. A sample picture of a fictional ATM card. The largest part of the world's money exists only as accounting numbers which are transferred between financial computers. Various plastic cards and other devices give individual consumers the power to electronically transfer such money to and from their bank accounts, without the use of currency. Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts in a particular country or socio- economic context. The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value; and, sometimes, a standard of deferred payment. It derives its value by being declared by a government to be legal tender; that is, it must be accepted as a form of payment within the boundaries of the country, for . Bank money, which consists only of records (mostly computerized in modern banking), forms by far the largest part of broad money in developed countries. In the ancient world Juno was often associated with money. The temple of Juno Moneta at Rome was the place where the mint of Ancient Rome was located. The Mesopotamian shekel was a unit of weight, and relied on the mass of something like 1. Societies in the Americas, Asia, Africa and Australia used shell money . According to Herodotus, the Lydians were the first people to introduce the use of gold and silver coins. Eventually, these receipts became generally accepted as a means of payment and were used as money. Paper money or banknotes were first used in China during the Song Dynasty. These banknotes, known as . However, they did not displace commodity money, and were used alongside coins. In the 1. 3th century, paper money became known in Europe through the accounts of travelers, such as Marco Polo and William of Rubruck. The gold standard, a monetary system where the medium of exchange are paper notes that are convertible into pre- set, fixed quantities of gold, replaced the use of gold coins as currency in the 1. Europe. These gold standard notes were made legal tender, and redemption into gold coins was discouraged. Let's Make Fundraising History for Jill! Be a part of Jill's first “Money Boom” to pay for the next $650,000 in TV ads! Have you seen the 3 new splendid TV ads that have been running on MSNBC and other broadcast outlets for the past week? On a misty afternoon on Tuesday in Accra, Mary Agyekum sits by a desk, arms akimbo, earpiece in ear and looking pensive which she recalls is the result of a slowdown in business transaction for the day. Agyekum, a 24-year old teller of a mobile money agent, is indebted to her employer for. France is in a slightly better shape, but with an average 0.3 percent quarterly growth since the middle of last year, and no growth at all in the second quarter of this year, this is not an example of the economy thriving on cheap credit. Indeed, the country's 2.9 million. Sending money with Boom is better for you and your loved ones. Faster and easier for you Send money to your loved ones anytime, anywhere, 24/7 through our mobile App Easier and safer for your loved ones Thousands of convenient and secure cash locations. Boom, the mobile personal payment and banking service announced in May at Hillary Clinton’s Diaspora Forum, is now open, bringing a low-cost mobile alternative to cash remittance services. The service, which targets unbanked workers who often send money home, is launching in the U.S., Mexico. By the beginning of the 2. After World War II and the Bretton Woods Conference, most countries adopted fiat currencies that were fixed to the US dollar. The US dollar was in turn fixed to gold. In 1. 97. 1 the US government suspended the convertibility of the US dollar to gold. After this many countries de- pegged their currencies from the US dollar, and most of the world's currencies became unbacked by anything except the governments' fiat of legal tender and the ability to convert the money into goods via payment. According to proponents of modern money theory, fiat money is also backed by taxes. By imposing taxes, states create demand for the currency they issue. By 1. 91. 9, Jevons's four functions of money were summarized in the couplet: Money's a matter of functions four,A Medium, a Measure, a Standard, a Store. One of these arguments is that the role of money as a medium of exchange is in conflict with its role as a store of value: its role as a store of value requires holding it without spending, whereas its role as a medium of exchange requires it to circulate. It thereby avoids the inefficiencies of a barter system, such as the . Money's most important usage is as a method for comparing the values of dissimilar objects. Measure of value. A unit of account (in economics. It is thus a basis for quoting and bargaining of prices. It is necessary for developing efficient accounting systems. Standard of deferred payment. While standard of deferred payment is distinguished by some texts. When debts are denominated in money, the real value of debts may change due to inflation and deflation, and for sovereign and international debts via debasement and devaluation. Store of value. To act as a store of value, a money must be able to be reliably saved, stored, and retrieved . The value of the money must also remain stable over time. Some have argued that inflation, by reducing the value of money, diminishes the ability of the money to function as a store of value. These financial instruments together are collectively referred to as the money supply of an economy. In other words, the money supply is the amount of financial instruments within a specific economy available for purchasing goods or services. Since the money supply consists of various financial instruments (usually currency, demand deposits and various other types of deposits), the amount of money in an economy is measured by adding together these financial instruments creating a monetary aggregate. Modern monetary theory distinguishes among different ways to measure the money supply, reflected in different types of monetary aggregates, using a categorization system that focuses on the liquidity of the financial instrument used as money. The most commonly used monetary aggregates (or types of money) are conventionally designated M1, M2 and M3. These are successively larger aggregate categories: M1 is currency (coins and bills) plus demand deposits (such as checking accounts); M2 is M1 plus savings accounts and time deposits under $1. M3 is M2 plus larger time deposits and similar institutional accounts. M1 includes only the most liquid financial instruments, and M3 relatively illiquid instruments. The precise definition of M1, M2 etc. It is measured as currency plus deposits of banks and other institutions at the central bank. M0 is also the only money that can satisfy the reserve requirements of commercial banks. Market liquidity. Market liquidity describes how easily an item can be traded for another item, or into the common currency within an economy. Money is the most liquid asset because it is universally recognised and accepted as the common currency. In this way, money gives consumers the freedom to trade goods and services easily without having to barter. Liquid financial instruments are easily tradable and have low transaction costs. There should be no (or minimal) spread between the prices to buy and sell the instrument being used as money. Types. Currently, most modern monetary systems are based on fiat money. However, for most of history, almost all money was commodity money, such as gold and silver coins. As economies developed, commodity money was eventually replaced by representative money, such as the gold standard, as traders found the physical transportation of gold and silver burdensome. Fiat currencies gradually took over in the last hundred years, especially since the breakup of the Bretton Woods system in the early 1. Commodity. Many items have been used as commodity money such as naturally scarce precious metals, conch shells, barley, beads etc., as well as many other things that are thought of as having value. Commodity money value comes from the commodity out of which it is made. The commodity itself constitutes the money, and the money is the commodity. These items were sometimes used in a metric of perceived value in conjunction to one another, in various commodity valuation or price system economies. Use of commodity money is similar to barter, but a commodity money provides a simple and automatic unit of account for the commodity which is being used as money. Although some gold coins such as the Krugerrand are considered legal tender, there is no record of their face value on either side of the coin. The rationale for this is that emphasis is laid on their direct link to the prevailing value of their fine gold content. Representative money is money that consists of token coins, paper money or other physical tokens such as certificates, that can be reliably exchanged for a fixed quantity of a commodity such as gold or silver. The value of representative money stands in direct and fixed relation to the commodity that backs it, while not itself being composed of that commodity. Instead, it has value only by government order (fiat). Usually, the government declares the fiat currency (typically notes and coins from a central bank, such as the Federal Reserve System in the U. S.) to be legal tender, making it unlawful not to accept the fiat currency as a means of repayment for all debts, public and private. However, fiat money has an advantage over representative or commodity money, in that the same laws that created the money can also define rules for its replacement in case of damage or destruction. Now we have copper coins and other non- precious metals as coins. Metals were mined, weighed, and stamped into coins. This was to assure the individual taking the coin that he was getting a certain known weight of precious metal. Coins could be counterfeited, but they also created a new unit of account, which helped lead to banking. Archimedes' principle provided the next link: coins could now be easily tested for their fine weight of metal, and thus the value of a coin could be determined, even if it had been shaved, debased or otherwise tampered with (see Numismatics). In most major economies using coinage, copper, silver and gold formed three tiers of coins. Gold coins were used for large purchases, payment of the military and backing of state activities. Silver coins were used for midsized transactions, and as a unit of account for taxes, dues, contracts and fealty, while copper coins represented the coinage of common transaction. This system had been used in ancient India since the time of the Mahajanapadas. In Europe, this system worked through the medieval period because there was virtually no new gold, silver or copper introduced through mining or conquest. This economic phenomenon was a slow and gradual process that took place from the late Tang Dynasty (6. It began as a means for merchants to exchange heavy coinage for receipts of deposit issued as promissory notes from shops of wholesalers, notes that were valid for temporary use in a small regional territory. In the 1. 0th century, the Song Dynasty government began circulating these notes amongst the traders in their monopolized salt industry. Robot Check. Enter the characters you see below. Sorry, we just need to make sure you're not a robot. For best results, please make sure your browser is accepting cookies.
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