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Through the Lens of History – Vision 13: “Gold and Silver Pieces? Exactly” Money, Part I

15 July, 2010

Through the Lens of History: Using History for Better Gaming
Vision 13: “Gold and Silver Pieces?  Exactly.”
Money, Part I

The best things in life are free
But you can give them to the birds and bees
I want money

-“Money (That’s What I want)” by the Flying Lizards

Money is such an interesting concept, yet we rarely think about it.  Pieces of printed paper and minted coins have been imbued with a value far exceeding the material or artistic value of the items involved.  But it is only recently that the value of money has become divorced from the value of some item; usually the precious metal that the money either was made from or represented.  For example, silver dollars were once made of silver, and the value of a coin was usually relative to the amount of metal it was made from.  As a note, bullion is bulk metal, valued by weight alone.

This Lens will take a brief look at the origin of coins, coinage and some other monetary systems.  Money and coinage is a subject the Lens will return to.

Part I – The History

Ancient Greek coins from the Pernik Museum of History (Bulgaria)

Ancient Greek coins from the Pernik Museum of History (Bulgaria)

The use of valuable metal as a medium of exchange dates back to the third millennium BCE: Copper, silver and gold being the primary metal of exchange, these metals were rare enough to be valuable but durable and useful as decoration.  The earliest money consisted of nothing more than pieces of valuable metal.  These pieces were sometimes shaped into rings or drawn into wire to set them at rough weights for use.  Larger ingots of metal would have pieces cut or shaved off as needed.  The purpose of using money is a shorthand for value, it is much easier to carry around half a pound (quarter kilo) of silver than it is to carry four chickens and a bushel of grain.

The earliest use of silver as money is in ancient Mesopotamia around five thousand years ago.  The temples of Mesopotamia maintained the system of scales and weights allowing the value of silver to be standardized.  The Mesopotamian legal code assessed fines in weights of silver. For example, biting a man’s nose was punishable by a fine of a mina (about half a kilo/a little over a pound) of silver, while a slap to the face was only valued at 10 shekels (a sixth as much).  Weights of grain, as well as silver, were used to value food stuffs, while silver alone was used for a wider variety of goods.  For those who did not have silver, grain was an acceptable payment as well.

Egypt had no domestic source of silver. The Egyptians used gold and copper in the same way.  By the later New Kingdom (roughly 1295-1069 BCE) standard weights, the deban (91 grams/3.2 ounces) and the kite, one tenth of a deban were established.  The Egyptians were happy to use silver when they could get it and their word for silver, hedj, became used very much like we use the word money.

The mina and shekel became the common unit of exchange through the ancient Middle East and they were even accepted as far away as Greece by the first millennium BCE.  The next evolution of money was to come from the Kingdom of Lydia in Asia Minor (modern Turkey) in around 700 BCE (about the same time proto-money was being produced in China).  The Lydian Kingdom was fortunate in having a source of electrum, a natural alloy of gold and silver, which they minted into small ovals in regular weights.  Most of these proto-coins had a design of some sort stamped onto one side.  But neither the size nor the symbol immediately indicated the purpose of value of these electrum units, limiting their usefulness as coinage.

It is not until the mid-fifth century BCE that real coins appear, starting in Lydia, possibly during the reign of King Crosus, c. 560-547 BCE.  The innovation of coins is not to be underestimated. A coin was both a guarantee of weight and purity of metal, facilitating trade by allowing both sides to know what was being offered.  Coins were first used within cities for small trades and their use slowly expanded to external trade, though coins often had a higher value then their weight would indicate in their issuing lands.  These first coins were almost uniformly made of silver and production soon spread throughout the lands on the Mediterranean basin.  Electrum, as a mixture of gold and silver, soon fell out of favor as the ratio of the metals was unpredictable, making valuing the coins difficult.  Using bronze for low value coins as it was hard wearing, and inexpensive, seems to have originated in southern Italy in the late fifth century BCE but quickly spread throughout the Greek world.

Silver tetradrachm from the kingdom of Thrace, reign of Lysimachus (305–281 BC)

Silver tetradrachm from the kingdom of Thrace

These coins were made by setting a weighted amount of metal (a “blank”) on a bronze or iron die and striking it with a hammer or stamp with another mold on it.  This stamped images into both sides of the coin as once, but led to the occasional mis-struck, off center or double struck coin.  Some of these dies were works of art in their own right and even signed by their makers.  Early coins featured gods and symbols of the cities that made them.  Later coins would also be stamped with images of rulers, starting with the Successor Kingdoms to Alexander the Great who put Alexander on their coins to emphasize their link to him.  Coins of rulers often used the symbols of gods or pictured gods on the reverse side to associate the ruler with the aspects of the god depicted (such as Nike, goddess of victory, or Zeus, king of the gods).

The bankers of ancient Greece usually ran small operations acting as something between pawnbroker and moneychanger.  Some moneychangers did business in the agora (central marketplace) from behind tables. Even today the modern Greek word for bank, trapeza, also means table.  Moneychangers weighed and exchanged coins, kept money on deposit and made loans (usually at a reasonable 12 per cent yearly interest rate), but these were all private matters, one person to another.

There was no state bank in the Greek world.  Excess money was stored in the temple of the city’s patron god (such as the Acropolis in Athens) where the god or goddess, or fear thereof, would protect it from thieves.  In times of crisis, the city would borrow the money from the temple, planning to pay it back later. In dire times even the statues of the gods would be melted down and sold.  Some temples even leant money out to the citizens of their city-state.

By the 4th Century BCE, coins had entirely displaced bullion in most areas.  This is known because recovered hordes of money found from those dates onward consist almost entirely of coins.  With the widespread of coinage, counterfeiting and doctoring coins became a problem.  In Athens, it was forbidden to pass fake coins and a law of 375 BCE instituted the checking of coins by public slaves.

There are a variety of ways to fake coins or otherwise reduce their value.  Debasing, that is mixing in base metals to reduce the amount of precious metal used while keeping the weight roughly the same, was used most commonly by those who mint coins.  Governments often debase their coinage to boost apparent wealth.  Debasing coinage often leads to the hoarding of early, purer coins while the new currency spreads (the origin of the saying “Bad money drives out good”).  Plating coins of base metals with a thin layer of a more valuable one, such as covering copper or brass with gold.  Shaving and clipping, both of which cut small pieces of metal away from the coin to be reused as bullion or recast as coins.

Part II- Breaking it apart and putting it back together

Celtic gold coin

Celtic gold coins

A group of adventurers might travel to another part of the world where their money is only valuable by the weight of metal it contains and discovers that its value is less then the adventurers believed.  The adventurers might even find that the coins that they have been seriously debased and are worth far less as bullion than the characters expected.

Issues of coins and coinage are all good sources for adventures.  Characters can be hired to escort, or find, an artist to make new dies for a special occasional, such as the coronation of a new ruler.  A set of dies may be stolen, requiring their retrieval before someone uses them to undermine the currency.  Counterfeiters need to be tracked down and dealt with.

Considering how much  most games revolve around money, it is surprising that the issue of coins, coinage and counterfeiting do not show up more often.  As such, these are subjects that the Lens will look at again.

Image Sources: Bulgarian Hoard, Tetradracm, and Celtic Gold.

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