Editing Money (section)

==A Brief History of Money==

The basic idea of money emerged in the Late Bronze Age. Before then people would give gifts and do favors for their neighbors, they would barter goods with other groups and governments would pay people to work in food and goods that they collected in taxes or commissioned. A few goods were more valuable for long distance trade (salt, cloth, metals, Cowrie shells, Cacao beans in Meso America) though for the most part wealth was calculated in terms of food. Coinage emerged as a way to quantify the value of food, instead of departments having to move 10 bushels of grain from each other's storehouses they could simply give 10 Shekels, which could be redeemed at a central granary.

Gold and silver in particular were attractive as they could both be worked easily, did not rust (in the conventional sense anyway), and appeared to exist in a fixed ratio to each other (17.5 silver to 1 gold on Earth, close-ish to the theoretical ratio from stellar sources).  This made them good to use as a token that could be universally exchanged, but gold and silver are still heavy to lug around for transactions, while being all too easy to carry away by robbers. 

Up until 1971, Money in England the was laid out as such...
*Two farthings was worth a halfpenny (aka a Ha'penny).
*Two halfpennies was worth a penny.
*Two pennies was worth a tuppence.
*Three tuppence was worth a sixpence.
*Two sixpence was shilling (aka a Bob)
*Twenty shillings was a pound.

So what people settled on was trading their stuff for precious metals, and then storing those precious metals in a bank and trading notes around that represented precious metals.  Of course, this had some teething problems, the earliest banks (and some recent ones) weren't very trustworthy.  Eventually governments moved away from that as pinning currency values to metals (or even valuable mineral commodities like energy resources) was limiting to the money supply, and so they removed that connection and that's where we stand today. As a result, most currencies are based on national government promises to fulfill monetary bonds (aka IOU bills) in the hypothetical event some stockholders or retirement pensioners wants to cash out (though several at a time in a similar manner to players cashing out poker chips in the casino) as well as the "relative" strength of the target economy where stronger bills are useful for investments, imports, or savings while weaker bills are useful for buying raw materials, exports, or paying for cheap labor. 

TLDR, modern money has value basically because people believe it has value, and as long as that's the case we're okay. When it's not the case, the result is Venezuela, where the Bolivar is worth less than WoW gold. Some people are hyping up cryptocurrencies or digital currency as the future due to decentralization, resistance to forgery from blockchain encryption, unique digital signatures, or lack of paper, plastic, or metalworking. On the other hand, such things only work if you have digital infrastructure alongside a reliable power grid to keep it all chugging along, and of course people willing to take it as money. Plus, the whole crypto set-up has basically been a speculative thing from day one and has been extremely volatile compared to other traditional financially traded assets.