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History of money and banking : Essay
History of money and banking : Essay
Historical development of money
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Without money we would all be rich
Could we transcend money in the future of finance?
What’s that old saying… “money makes the world go round”?
Aristotle considered every object to have two uses: the function or purpose for which it was created, and for trading or bartering. However, without the timely coincidence of wants between traders, barter potential remains severely limited unless there is an underlying medium of value exchange.
Hence money emerged.
The Greek philosopher has been criticised for suggesting that money was invented to replace bartering, instead created as a quantifiable form of “I owe you” or a store of value or credit in modern day terms.
Early money manifested as cattle or grain, metals and artefacts. Gold and
Goldsmiths served as financial intermediaries, allowing depositors to store their wealth in private vaults and charging a fee and providing a non-transferable receipt of quantity and purity.
Goldsmiths eventually began re-lending on behalf of the depositor, forgoing the fee for storage and even paying interest in return. Receipts became transferable, and enabled safer and more convenient transfer of money representing their underlying assets.
In time, goldsmiths became banks, and banks began issuing banknotes giving rise to paper money (only a fraction of which would be backed by actual deposits, but theoretically convertible at any point). Banknotes were standardised as legal tender and precious metals were replaced with symbolic money.
The first Australian banks were regulated by the government, with controlled interest rates. They provided deposit and mortgage products to consumers or investment banking and private equity to businesses.
Deregulation slowly allowed banks (and lenders) to set their own rates, provide new finance options, operate in both consumer and commercial markets, as well trade in the money market — the buying and selling money in the form of various layers of financial instruments such as loans and
Digital experiences, beautiful designs, responsive applications, push notifications, social identification. Machine intelligence, recommendations, natural language processing, predictions, crypto-ledgers. Each one a step forward for technology, bringing yesterday’s financial products closer to tomorrow’s societal needs.
Economies are changing. Decentralisation and sharing are powering adoption of new platforms for financial (and ultimately human) collaboration. Automation, robotics and artificial intelligence are bringing us closer to a post-work society. The distribution of wealth is becoming increasingly disparate, challenging economic equality and extending wealth gaps in every nation.
Without money we would all be rich. Money unlocked the potential of value exchange, allowing us to give more than we have and take more than we need.
We live in a time of serious opportunity to modernise financial services for our future, but who will rise to the
He states that the financial system was based on competing state banks with no central bank which promoted a rapid economic growth. As the American banking system developed the money supply developed with it. The federal government began the banking system through the issuing of specie but as the capitalist system developed the banking structure developed as well. During the Civil War, the North printed Greenbacks that drove gold from the domestic circulation to help pay for war necessities. The Greenbacks, however, were rarely used in the South expressing the different economies of the North and the South at the time of the Civil War. With differing economies and the growth of specie and paper money, Brands argues that the basis of knowledge about the money system of this time lays a foundation for how Carnegie, Rockefeller, and others were able to manipulate the market and gain wealth. Leading into price manipulation by those in corporate
world began to use this item as a means of currency. Leading in the production of this element
Paper money that was issued by the colonial government was a concern. Certain paper money could only be used for paying public debts, including military supplies or taxe...
...re money without having any gold and silver to back it up. Some feel that this has been fulfilled and possibly will be fulfilled again in the future. (Hogue 149.)
Money is the main source of power in the world, but in ways it can be viewed as good or bad depending on the situation. It has a negative connotation when mentioned by the word “acts”. “ Acts” means to perform a fictional role. Which shows that most things involving money are fake. Though humans associate being fake with being morally wrong,but its somehow acceptable if there is a greater power involved. Another definition for acts is to take action;do something. In this case to take an action can be either good or bad. There are many ways to come across money, but nobody cares if it is good or bad because it deals with a greater power.
The Banking Act of 1933 and 1935 was then formed to make the Federal Reserve responsible for monetary policies for banks, the stock market and many other businesses. The formation of this act caused investors to become more actively involved in the federal government as well as the citizens of America. The Glass-Steagall Act was also passed to regulate speculation. It restricted investors from excessively using bank credit to cause “artificial" rise in stock prices. It also made investors confident about putting their money into a less speculative market.
People in ancient times developed the concept of money around the year 2500 B.C. Some historians argue that it may have been even earlier. The first form of ?money? was silver in Mesopotamia. Silver functioned just like the money we use today. It had a standard, it was weighed in shekels so that one could determine the value of the silver in relation to its weight. Today, the way we determine the value of our money is by looking at the number in the corners of a bill. Like our money today, silver was easily portable compared to goods like milk and grain.
Even before the creation of the Federal Reserve, banks were used by the public just as we use them today. Deposits were made into savings accounts. Loans were taken out to mortgage a home or finance a new business. Banknotes were issued and spent when the public borrowed from the banks. Borrowers spent these banknotes just as paper money is spent today. These bank notes were valued as money since they were backed by the promise that they would be exchanged on demand for either gold or silver.
...uggests that the spread of the money form gives individuals a freedom of sorts by permitting them to exercise the kind of individualized control over "impression management" that was not possible in traditional societies. ... ascribed identities have been discarded. Even strangers become familiar and knowable identities insofar as they are willing to use a common but impersonal means of exchange. (Ashley and Orenstein, p. 326)
Money has evolved with the times and is a reflection of the progress of man. Early money was a physical commodity, grain, gold or silver. During the vital stage, more symbolic forms of money such as certificates of deposit, bank notes, checks, letters of credit, bonds and other forms of negotiable securities came into prominence. Social development transformed money into a trust, “In God We Trust' it says on the back of the ten-dollar bill.” (The Ascent of Money, 27)
The invention of money was a major improvement in peoples’ lives. In the past, people usually had to travel all day to find the person who is willing to exchange their goods. In addition, the goods people want to exchange did not have the standard value of measurement. This led to unequal exchanges. Furthermore, it is not convenient to carry heavy goods from one place to another for an exchange. To solve these issues, money will be the only solution. Later, people tend to develop money from cowry shells to credit cards for the convenience and to improve their society.
Saving money brings security for any future expenses. The earlier in life an individual begins to save, the better they will be set financially in the years to come. There are several reasons why it is important to save money. A few of these reasons are for emergencies, retirement, and simply for luxury spending. Having money will benefit each of these examples.
With technology advancing every day, the way people shop and invest their money has drastically changed. This is impacting financial professionals as