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  1. 1. The History of Money
  2. 2. <ul><li>Before people used money, they bartered , or traded things they had for the things they wanted. For example, a person may have traded five goats for one cow. Bartering was not always simple, though. Each person had to agree that the items being traded had an equal value. Also, each person had to have something that the other person wanted. </li></ul><ul><li>People invented money to avoid bartering. </li></ul>
  3. 3. <ul><li>People have used money for more than 4,000 years. Money is any good or token (знак) used by a society as a medium of exchange, store of value and unit of account. </li></ul>
  4. 4. <ul><li>Whenever people pay for goods or services, they use some form of money. Money can be almost anything, as long as everyone agrees on its value. One of the earliest forms of money was metal, such as gold or silver. In North America, Native Americans used beads made of shell, called wampum, as a form of money. </li></ul>
  5. 5. <ul><li>China, in 1,000 B.C., produced mock cowry shells at the end of the Stone Age. In addition, tools made of metal, like knives and spades, were also used in China as money.  From these models, we developed today's round coins that we use daily. </li></ul>Circa 900-500BC
  6. 6. <ul><li>In the 600s BC the kingdom of Lydia in what is now Turkey began to make coins. It was probably the first government to do so. These coins were made of electrum , a precious alloy (сплав) of gold and silver that consists of about 54 percent gold, 44 percent silver, and 2 percent copper. </li></ul>The Lydian Lion’s Head: circa 600-575 BC
  7. 7. <ul><li>The Chinese coins were usually made out of base metals which had holes in them so that you could put the coins together to make a chain. </li></ul>Copper coins used before 221 BC Coin issued in 221 BC by the Qin Dynasty , the first feudal dynasty to unify China and its coins.
  8. 8. <ul><li>The Greeks and Romans minted coins hundreds of years before the time of Christ. The very earliest coins were struck about 600 BC. A lot of the Greek coins were silver. </li></ul>Nero minted in 64-66 A.D. Alexander the Great, coin, 355–281 BC
  9. 9. <ul><li>The first types of paper money were used in China more than 1,000 years ago. Early paper money was simply a written promise to pay a certain amount of gold or silver money. The paper money was valuable because it could be traded for gold or silver. Later, governments began printing paper money. </li></ul>The first uniform paper money in the world, the Jiaozi, issued in 1023 under the Song Dynasty. Chinese note 1368-1399 about the size of a sheet of notebook paper.
  10. 10. <ul><li>The last paper money of the Chinese feudal dynasties: 1875 to1908 </li></ul>
  11. 11. <ul><li>By the late 18th and early 19th centuries paper money and banknotes had spread to other parts of the world. </li></ul>
  12. 12. <ul><li>The first world money, the Spanish silver dollar or “pieces of eight” minted in Spain, Mexico and Peru. </li></ul><ul><li>The Spanish peso contained 25.560 grams pure silver and was also used as domestic money in Asia, Latin America, America and Europe. </li></ul>
  13. 13. <ul><li>The early 20th century was the great era of the international gold standard . The gold standard is a monetary system in which the standard economic unit of account is a fixed weight of gold. </li></ul>
  14. 14. <ul><li>I n July 1944 t he agreement of more than 40 countries led to the creation of the International Monetary Fund (IMF), which countries joined by paying a subscription. Members agreed to maintain a system of fixed but adjustable exchange rates. Countries with payment deficits could borrow from the fund, while those with surpluses would lend. </li></ul>
  15. 15. <ul><li>The dollar became the most widely used currency in international trade, even in trade between countries other than the United States. It was the unit in which countries expressed their exchange rate. </li></ul>1$ George Washington 2$ Thomas Jefferson 5$ Abraham Lincoln 10$ Alexander Hamilton 20$ Andrew Jackson 50$ Ulysses S. Grant 100$ Benjamin Franklin 500$ William McKinley 1000$ Grover Cleveland 5000$ J ames Madison 10000$ Salmon P. Chase
  16. 16. The largest bill ever circulated in the United States is the $10,000 bill , which features the face of Salmon P. Chase, who was Abe Lincoln's Secretary of the Treasury. If you have one, you can spend it, but most of them are in museums these days.
  17. 17. <ul><li>O n August 15, 1971 t he system of fixed exchange rates broke down . President Richard Nixon severed ( отделил) the dollar from any connection to gold. Since then the international monetary system has consisted of a collection of currencies linked by floating exchange rates. </li></ul>5 pounds 20 pounds
  18. 18. <ul><li>12 European countries - Luxembourg, Ireland, Finland, t he Netherlands, Belgium, Germany, France, Austria, Italy, Spain, Portugal and Greece adopt ed the euro . O n February 28, 2002 all national bills and coins of the 12 member nations were withdrawn from circulation and the euro became the sole ( единственная ) legal currency in use. </li></ul>