Its all about how the pattern of currency or money change .

1. Mohiminul Islam ID:UG01-35-14-069
Financial Market and Institution (FIN-303)

2. Convenience
 It is often easier to use money
than barter / trade
 Would you prefer to receive fish or eggs
instead of cash for the services you provide
to your employer ?

4.  A medium of exchange
 A unit of account
 A store of value

5. Historically, gold & silver coins and bars

7.  11th Century China – Flying Money.
 Called it “flying money” because it could
just fly from your hands.
 Banks had switched to the use of iron
coinage due to copper shortage.
 These iron coins became over-issued and
fell in value.
 A bank in the Szechuan province issued
paper money in exchange for the iron
coins.

8.  John Law was the first man to introduce paper
money to France in the early 18th Century
 Louis XIV died and left 3 billion
livres of debt to his son, Louis XV
 Louis XV required that all taxes be paid in
paper money, which was initially backed by
coinage
 After high inflation, people demanded coinage,
and the currency collapsed.
 John Law became the most hated man in
France and was forced to flee to Italy.

9.  In the latter part of the 18th century, the
French government tried paper money again.
 By 1795, inflation of assigners was
running at approximately 13,000%.
 Then Napoleon returned the country
to gold coinage, a stable currency.
 French gave it another go in the 1930s, this
time with the paper franc. It took only 12
years for them to inflate their currency until
it lost 99% of its value.

10. History of Money
Bartering & Exchange Shells (1200 B.C.) Metals(1000 B.C.)
Paper
Money
(1000A.D.)
Coins (600 B.C.)
Banking
in Europe
(1400 A.D.)
Wampum
(1637)
The Gold
Standard
(1816)
Credit
Card
(1950)
Plastic Money
(1990s)
Google Wallet &
Clear Exchange
(2011)

11. Hungary – 10 million pengo, 1945

12. Zimbabwe – 100 trillion dollars, 2006

13.  The money stored in certain
electronic cash cards.
 Transactions are made
electronically.
 Examples are Credit Card,
Debit card, Charge card etc.

14.  Money should be durable, it should not get easily
decomposed or degraded.
 Money should be handy, easily transportable.
 Accepted – People are willing to accept
 Divisible – it can be divided into smaller parts
 Stable in value – The value of Money dose fluctuate,
but overall it remains stable.
 Limited supply – Supply must be scarce