A short history of money and bartering.....

What is money? Money is what we use to pay for things.We use money to buy products such as food , clothes and toys.We use money to pay for services such as a train drive or a visit to the doctor.We also use money to pay debts.
Coins and bills are forms of money.Governments make coins and bills from small amounts of paper , plastic or metal.These materials are not worth much on their own so a government gives each coin and bills a value.That way everyone knows what their coins and bills are worth , and can use them to make and accept payments.Coins and bills are also called cash.
Coins and bills are not the only form of money.Sometimes people make payments with checks , credit cards or money they have in the bank.
Long ago , money as we know it today did not exist.Early humans moved from place to place following the animals they hunted.There were no shops or banks.Instead , people would exchange products and services.This is known as bartering.
Imagine that a hunter had some animal skins but wanted some fish.The hunter had to find a person who had fish and who wanted animal skins.They would then barter some skins for some fish.No money was involved.Instead the people worked out what they thought was a fair exchange of their products.
Later humans began growing their own food and raising farm animals.Groups of people built homes near each other , and villages began.Farmers were able to grow enough food to feed the villagers People who did not have to grow their own food had time to develop their own different skills , such as weaving and pottery.They bartered their products and services with each other and with people from other villages.
There were problems with bartering .Imagine that a farmer had two chickens and wanted to buy a large rug , but the weaver wanted three chickens for the rug.If the traders could not agree on the value of their goods , no exchange could take place.
Perhaps the weaver wanted a basket of fruit instead of chickens.The farmer would first have to find a fruit grower to barter the chickens for fruit for the rug.Finding a person who had what you wanted , and wanted what you had , was sometimes difficult and time consuming.
Over time people began to prefer certain products for bartering .Products that became popular included farm animals , grain , rice, salt, cloth , simple tools , and shells.People agreed on the value of these products and these products became the first types of money.
Some products were popular as money because they were useful.Farm animals gave people meat , milk , eggs , skins , wool and feathers.They could also be used to do labour and to breed more animals.Grain , rice and other foods could be eaten.Cloth could be made clothes and soft furmishings.Tools made many job easier.
Some products were popular partly because they looked good .Small colorful shells , called cowrie shells , were pretty and could be made into ornaments.
As people travelled further to barter their products and services , they had problems with using products as money.Imagine that a farmer with a horse to barter wanted products from several traders.How could the farmer divide the horse between the traders ?Or imagine that a trader came from a country where cowrie shells were common and not highly valued , and would not accept the shells in exchange for products.
Many products used as money had some disadvantages:
* They were hard to transport
* They were hard to count
* They were difficult to divide
* They were spoiled or damaged easily
* They needed to be cared for
* They were not accepted everywhere
People needed a form of money that would be easy to use , and transport.The new money also had to be accepted by everyone.