The history of money isn’t just an Economics story, but it’s a cultural and philosophical one, too. 

Felix Martin, a columnist for Reuters, charts this history in his book, Money: The Unauthorized Biography – From Coinage to Cryptocurrencies, and argues that money as a social institution has always been wielded as a political instrument. 

Felix and Greg discuss the determining factors of money’s value, some of the key moments in the history of currency, and what could be done to improve modern financial banking systems.

*unSILOed Podcast is produced by University FM.*

Money as a credit relationship

21:08: There is this great value in thinking about money as a credit relationship. And the real value is to think about two dimensions. One dimension is the creditworthiness of the issuer…[21:52] And another dimension I think conceptually, you can think of them as different. Some people like to think of them the same, but I think the difference is the liquidity question. Creditworthiness is about this bilateral relationship between you and the central bank. And then there's this question of how many other people in the network will accept this in payment of goods or services? And that's this sort of liquidity question. And, so these are two factors which are behind that. They're all subsumed under this (V) in the Fisher equation, but you can break them down a bit conceptually, I think, in terms of money as credit is useful to do that.

Money is a social institution

04:02: I believe that money is a social institution, a communal fiction, then a history of money is not a history of coins and notes and that kind of thing. It's an intellectual history. It's a history of these ideas and these institutions and where they come from.

What is the whole point of banking?

52:00: The whole point of banking and its historical origin is precisely the flexibility of the balance sheets of the banks. The whole way that the capitalist economy works, what is useful about banks and the reason they exist is precisely that they are able to expand and contract their balance sheets in line with the needs of trade.

Theories around money are useful but contingent

18:22: It's not that the Fisher equation or the quantity theory of money are not useful. All these theories of money are very useful for interpreting and predicting given points in time. But they are contingent.

• Sapiens: A Brief History of Humankind by Yuval Noah Harari
• John Locke
• The Nature of Money by Geoffrey Ingham
• Walter Bagehot
• Ecu de marc

• Author Page at Reuters
• Felix Martin’s Website
• Felix Martin on LinkedIn
• Feliz Martin on X

• Money: The Unauthorized Biography – From Coinage to Cryptocurrencies
• Articles on Financial Times
• Articles on Muck Rack