INTRODUCTION ABOUT MONEY more of a perceived equal "value" (for example a

load of wheat). For the most part of the two parties

BARTER- system of exchange where goods and bring the goods with them and hand them over at
services are directly exchanged for other goods and the time of a transaction
services EVIDENCE OF TRADE RECORDS (7,000 BCE)
 Pictures of items were used to record trade
COINCIDENCE OF WANTS- a perfect alignment of exchanges, becoming more complex as values
needs between the two parties were established and documented
COINAGE (600 BCE- 1,100)
MONEY- Money is any object or record that is generally  Defined weights of precious metals used by some
accepted payment for goods and services and merchants were later formalized as coins that were
repayment of debt even socio economic context or usually issued by states.
country BANK NOTES (1,100- 2,000)
 States began to use bank notes, issuing paper
ROLE OF MONEY IN THE ECONOMY IOUs that were traded as currency, and could be
Money is the oil that keeps the machinery of our world exchanged for coins at any time.
turning. By giving goods and services an easily DIGITAL MONEY(1,100- 2000)
measured value, money facilitates the billions of  Money can now exist "virtually, " on computers, and
transactions that take place every day. Without it, the large transactions can take place without any
industry and trade that form the basis of modern physical cash changing hands
economies would grind to a halt and the flow of wealth
around the world would cease.
ARTIFACTS OF MONEY
FUNCTIONS OF MONEY
The basic function of money is to facilitate exchange BARTER (5000 BCE)
transaction of goods and services  Early trade involved directly exchanged items often
1. Medium of exchange-If the troublesome problem perishabke ones such as cow.
of the “double coincidence of demand” Is to be SUMERIAN CUNEIFORM TABLETS (4000 BCE)
avoided, it is necessary that some readily available  Scribes recorded transactions on clay tablets, which
thing must be available as a medium of exchange could also act as receipts.
that will bring about a smooth and effective transfer COWRIE SHELLS (1000 BCE)
of goods from one hand to another. Thus, the need  Used as currency across India and the South
for something that will serve as an intermediary in Pacific, they appeared in many colors and sizes
the process of exchange LYDIAN GOLD COINS (600 BCE)
2. Measure of standard of value/unit of account-  In Lydia, a mixture of gold and silver was formed
Money serves as a measure or standard of value into disks, or coins, stamped with inscriptions
by providing a common unit of account that ATHENIAN DRACHMA (600 BCE)
facilitates the comparison of the worth of different  The Athenians used silver from Laurion to mint a
goods and services. currency used right across the Greek world.
3. Store of value- The use of money as medium of HAN DYNASTY COIN (200 BCE)
exchange for present and future transactions will  Often made of bronze or copper, early Chinese
give rise to its use as a store of value. Knowing that coins had holes punched in their center.
it represents general command over a variety of ROMAN COIN (27 BCE)
goods, people may decide to hold money, that is  Bearing the head of the emperor, these coins
save and thereby store “value” thus enabling them circulated throughout the Roman Empire.
to obtain the goods they may want and need any BYZANTINE COIN (700 CE)
time in the future  Early Byzantine coins were pure gold; later ones
4. Item of worth- Most money originally has an also contained metals such as copper
intrinsic value, such as that of the precious metal ANGLO-SAXON COIN (900 CE)
that was used to make the coin. This in itself acted  This 10th century silver penny has an inscription
as some guarantee the coin would be accepted. stating that Offa is King ("rec") of Mercia.
5. Standard of deferred payment- Money is also ARABIC DIRHAM (900 CE)
useful because of its ability to serve as a standard  Many silver coins from the Islamic empire were
of deferred payment, Money can facilitate exchange carried to Scandinavia by Vikings
at a given point by providing a medium of exchange
and unit of account

EVOLUTION OF MONEY (10,000 BCE to 2000

onwards)

THE BARTER SYSTEM (10,000- 3,000 BCE)

 In early forms of trading, specific items were
exchanged for others agreed by the negotiating
parties to be of similar value. the barter system
10000 - 3000 bce Essentially, barter involves the
exchange of an item (such as a cow) for one or
THE ECONOMIES OF MONEY
 From the 16th century, understanding of the nature EURO (1999)
of money became more sophisticated. Economics Twelve EU countries joined together and replaced their
as a discipline emerged, in part to help explain the national currencies with the Euro bank notes and coins
inflation caused in Europe by the large-scale were issued three years later.
importation of silver from the newly discovered
Americans. BITCOIN (2008)
 National banks were established in the late 17th Bitcoin a form of electronic money that exists solely as
century, with the duty of regulating the countries encrypted data on servers - is announced. The first
money supplies. transaction took place in January 2009.
 By the early 20th century, money became
separated from its direct relationship to precious HIGHLIGHTS IN THE HISTORY OF MONEY IN THE
metal PHILIPPINES
 The Gold Standard collapsed altogether in the
1930s. PRE-SPANISH REGIME
 By the mid- 20 century, new ways of trading with Prior to the coming of the Spanish in 1521, the
money appeared such as credit cards, digital Philippine was already trading with neighboring
transactions, and even forms of money such as countries such as China, Java and Macau. Through the
cryptocurrencies and financial derivatives. As a prevailing medium of exchange was barter, some coins
result, the amount of money in existence and in were circulating in the Philippines as early as the 8th
circulation increased enormously. century.
Commodity money such as gold, gold dust, silver wires,
POTOSI, INFLATION (1540-1640) coffee, sugar rice, spices, carabao were used as money.
The Spanish discovered silver in Potosi, Bolivia, and Between the 8th and 14th century the penniform gold
caused a century of inflation by shipping 350 tons of the barter rings were predominantly used by foreign
metal back to Europe annually. merchants. Piloncitos and other commodities were in
circulation.
THE GREAT DEBASEMENT (1542-1551)
England's Henry VIII debased the silver penny, making it SPANISH REGIME
threequarters copper. Inflation increased as trust The Spanish introduced coins in the Philippines when
dropped. they colonized the country in 1521. Silver coins minted
in Mexico were predominantly used in 1861, the first
EARLY JOINT-STOCK COMPANIES (1553) mint was established in order to standardize coinage
Merchants in England began to form companies in
which investors bought shares (stock) and shared its AMERICAN REGIME
rewards. After gaining independence in 1898 when Spain ceded
the Philippines to the United States. The country's first
BANK OF ENGLAND (1694) local currency, the Philippine Peso, was introduced
The Bank of England was created as a body that could replacing the SpanishFilipino Peso
raise funds at a low interest rate and manage national
debt. The Philippine National Bank was authorized to issue
Philippine Bank Notes. Later, the Bank of the Philippine
THE ROYAL MINT (1696) Island was authorized to issue its own bank notes.
Isaac Newton became Warden and argued that These notes were redeemable by the issuer but not
debasing undermined confidence. All coins were made legal tender
recalled and new silver ones were minted.
JAPANESE REGIME
US DOLLAR (1775) When the Philippines was occupied by Japan during
The Continental Congress authorized the issue of World War II, the Japanese issued the Japanese War
United States dollars in 1775, but the first national Notes. There bills had no reserves nor backed up by any
currency was not minted by the US Treasury until 1794 government asset and were called "mickey mouse"
money
GOLD STANDARD (1844)
The British pound was tied to a defined equivalent POST-WAR PERIOD
amount of gold. Other countries adopted a similar Gold In 1944, when the American forces defeated the
Standard. Japanese Imperial army, the Philippine Commonwealth
was established under President Sergio Osmeña. All
CREDIT CARDS (1970) Japanese currencies circulating in the Philippines were
The creation of credit cards enabled consumers to declared illegal, all banks were closed and all Philippine
access short-term credit to make smaller purchases. National Bank notes were withdrawn from circulation
This resulted in the growth of personal debt.

DIGITAL MONEY (1990)

The easy transfer of funds and convenience of
electronic payments became increasingly popular as
internet use increased.