MONEY AREA

Money Area



Historical Context of Sustainability - Money Area

Introduction

According to evolutionary theory, the origin of the money and the history of their appearance is the result of the social division of labor, exchange and commodity production. The earliest form of trade was barter or direct exchange of one commodity for another.

Money is any conventional means of payment, which can be exchanged for goods and services and used to pay debts. Money is the universal equivalent, special commodity, a form of expressing the value of all other commodities.

History of the Development of Money

Initially, the exchange of goods was made using the money in the form of ingots of gold and silver. This made ??the circulation of commodities that had to weigh the monetary metal, grind it into small pieces, set the sample, etc. Gradually, gold bullion (silver) were replaced by coins, ie metal bars of some form, weight, samples and dignity, which is certified by the state. Role of universal equivalent gold coin made ??in the form - government guaranteed weight of the gold.

The gold monometallism was established in Great Britain in the seventeenth century. and widespread in the last quarter of the nineteenth century. in Germany, France, Russia and Japan. The natural properties of gold (homogeneity, divisibility, portability, security, own value) secured him the privileged position of a universal equivalent value.

Money - liquidity is a tool to help make an exchange, they readily accepted in exchange for any product. Money, of course, facilitates the exchange, eliminating the difficulties of evaluation (how a product should pay for other goods). The market determines the price of any commodity.

Once the gold was confirmed in the role of money, it turned out that it does not have to be directly involved in the treatment, and may be replaced by its "representative." Such representatives first appeared in the form of paper money.

Displacement of gold coins with paper money due to the fact that, being in constant motion, hard money cleared, lose weight. The real content of the coin is different from its nominal (declared) content. Money becomes incomplete notsennymi, but at the same time continue to act as a universal equivalent. Hence, it does not matter what they look like, as long as they were acceptable, recognized by all as money. Moreover, the value of gold as a precious metal has always been high, and this has led to the recovery of the gold coins from circulation to make and sell at a profit, such as jewelry. This has a negative effect on the circulation of money is driving the need of additional minting coins.

Paper money is issued by the state, required to accept banknotes, replacing gold in the exchange. The main requirement for paper money is their acceptability. If you stretch the seller over the counter rubles or Euros to buy the product, and the shop owner refuses to take it, then, the existing funds do not meet this criterion. Issue of admissibility existed in many ...