Money is older than history. What came first? The written word, or the IOU? No one knows.
Mankind's first official currency consisted of notches on a tally stick – a simple but effective way of keeping score.

We are usually taught that money was created to simplify barter between people. This is false.[1]

Money is created as debt, and used for control.[2]

Early forms included farm products such as grain, later coins, i.a. for taxation.

How goldsmiths became the first bankers:

  • People trusted them to hold on to their coins.
  • The goldsmiths gave the people receipts.
  • People started using these receipts as if they were the coins themselves.
  • Goldsmiths noticed that people were quite happy to use receipts instead of coins.
  • This tempted the goldsmiths to issue more receipts than there were coins.
  • This 'extra money' was money the goldsmiths created.[3]

The battle over our money has raged on ever since. First with paper money as described, then with cheques, and then by computer.[4] The history of money creation is closely linked to that of warfare – states going into debt for war.

Before proceeding to our next article with further details, you might want to relax a little with this friendly list of things to NOT worry about:
- Abandonment of the Gold Standard in 1971. It's over. Good.[5]
- The shift from paper to electronic money. This only mattered when banks exploited a loophole regulators hadn't anticipated.
- Money that is basically just information, i.e. not a commodity or backed by one (fiat money).
- Money as such. "Money is an achievement" – quote from the accompanying text to our petition.
- People betting with their own money where no one else gets hurt if they lose it.
- If you are worried about interest, see: Is interest the problem?

If one wanted to worry about money, shouldn't it be relevant WHERE IT COMES FROM?
Why is this so rarely asked?
IMF researchers Benes and Kumhof:
"Any debate on the origins of money is not of merely academic interest, because it leads directly to a debate on the nature of money, which in turn has a critical bearing on arguments as to who should control the issuance of money."[6]
In plain English: "Don't ask. It will lead to more questions!"

by Michael K for Banks need Boundaries!


  1. Graeber, quoted in IMF 'Chicago Plan Revisited', p. 12
  2. Please note the word "and" – no causal connection is inferred.
  3. Some say this can be considered fraud, later legalised.
  4. See Positive Money, 'How we got here?' for a more extensive account based on the UK system.
  5. Mining is often tough on labour and the environment.
  6. IMF 'Chicago Plan Revisited'