The Impact of Modern Day Currency Has Had on World Culture - Free Essay

Introduction

In Modern Monetary Theory (MMT), modern-day currency refers to a literary reference to Keynes’ treatise on the money it proposes that the currency of modern states has been discussed for approximately 4000 years. Mainly currencies are public monopolies that are issued by the government, and the government is the only entity allowed to issue money. Currency plays a vital role in the modern world since it enables people worldwide to trade goods and services, which an exchange of money directly; this helps in communicating the price of goods, and it gives people an approach to storing their wealth in the long-term. Modern-day currency is one of the significant humankind inventions. Currency is important in the modern world since the modern-day economy is explained as a result of the money economy. Therefore, the modern economy cannot operate without currency. Currency is of great significance in the modern world since it occupies a central position in the modern economy. Marshall argues that money is the key pivot around which economic theories and science cluster. Currency has significant benefits in the modern world, and its change in value has a profound impact on the country’s economy (Pomeranz & Topik, 2017). The existence of a monetary economy in the modern world helps the community to discover what people yearn to achieve and to make the best use of its restricted productive power. Money assists members of society in making sure that the means of enjoyment to which they have access produce the greatest quantity of actual enjoyment within their reach. In the modern world, the currency has developed a far-reaching influence on all facets of economic events such as exchange, consumption, distribution, and production, and also in economic welfare and public finance. Diverse cultural groups and cultures have different values and traditions regarding the modern-day currency; hence it influences world culture greatly on the behavior of saving, consumption and investment decision-making, and the financial development of households. The research will focus mainly on the modern impact currency has on world culture, history of currency, inventions, and origins of modern-day currency and concludes with a conclusion.

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Modern Day Currency

Invention of Currency

The first person who invented currency is not known, but the historian claims that metal objects were first utilized as currency in early 5000 B.C. But in around 700 B.C., the Lydian is the first Western culture to mint coins. China is the first country that invent the world’s first paper currency, and in 1661, Sweden gave the first banknotes after China. The paper currency was invented in the 7th century by the Tang dynasty in China. However, China’s paper currency did not appear globally until the 11th century in the Song dynasty. After the invention of currency, the first usage of paper money was in 806 AD in China, and they were utilized as flying currency (Belshe, & Lee,2015). The highest currency invented around the world is the Kuwait dinar. 1 U.S. dollar is equivalent to 0.30 Kuwait dinar making Kuwait dinar currency the most valued currency in the world per face value.

The History of Currency

In 1100 BC, China was credited as the first country to use standardized currency in the shape of bronze and miniature. The early currency eventually evolved into coins that had holes in the center and finally, the use of paper money was invented. Currencies were connected to gold between 1870 and 1914; this implies that the value of local money was fixed at a set exchange rate for gold (Finlay & Francis, 2019). In World War I, gold ounces were abandoned. In late World War II, an effort was made to generate world economic stability and promote global trade, basic regulations, and standards formulated to govern international exchange.

The Origin of Modern-Day Currency

Most of the units of modern-day currency in use were derived from Roman originals and, more particularly, from the versions of the Roman coins printed during the Middle Ages. For example, the stable currency of the Byzantine Empire is in the form of gold coins. The Frankish Pepin III invented a silver “denarius,” which became the medieval principal coin in Western Europe (Eichengreen et al., 2019). The standardization of the penny was made by the Carolingian dynasty, and it was consequently created that 12 silver pennies are equivalent to shillings or Byzantine gold solidus. In the modern-day currency, such as the dollar was derived from coins and it was minted from 1517 in Bohemia.

Summary of Currency

Explanation of Currency and How It Works

In modern-day world culture, the currency is defined as the medium of exchange for services and goods. Money is also known as currency, and they are in the form of coins and papers. The only authorized entity to issue money is the government. Currency is accepted globally as the face value and medium of payment. In the modern world culture, the currency is mutually accepted as the key medium of exchange, replacing barter trade. In the 21st century, the currency has evolved rapidly into a new form of currency, such as virtual currency. The modern virtual forms of currencies like bitcoins have no physical presence or government backing, but they are stored and traded in electronic form (Yermack, 2015). Currency in the form of coins has typically been proven to be important in facilitating trade across continents. A primary feature of the modern-day currency is that they are uniformly worthless in itself. This implies that bills are pieces of paper instead of coins made of gold, bronze, and silver. The concept of utilizing paper as a modern-day currency may have been created in China in 1000 BC. Still, the acceptance of paper currency in exchange for goods or services of real value took a lengthy period to catch on. Therefore, modern currencies are commonly issued on paper; several denominations and fractional issues are coins.

Currency is used broadly in modern culture as a medium of exchange of services or goods. The use of currency is very vital in our daily transactions since even if we remove paper bills and swipe a credit card, the transactions that we engage in our daily life mainly use currency as the only medium of exchange. Most modern-day currencies are electronic records or credit money stored in databases in financial institutions or banks. But the butter and bread of our daily transactions remain to be the currency. Money is used to purchase things we need and is also used as a measure of wealth. The invention of currency has shaped human civilization, and it has greatly stopped wars. The use of money is very important in modern life. Currency works as a substitute for other assets and hence can be explained as the unit of buying power. Currency works as a measure of wealth. Despite that money works a substitute in trading, the currency is mainly used as a store of wealth in modern-day culture; most people use the currency to accumulate wealth (Eichengreen et al., 2019). The use of money as an accumulation of wealth has a significant influence on civilization in different cultures since it suggests that power is not often passed through families. Thus, the currency has made civilization in modern-day cultures more democratic by taking power from the hands of noble families, which had monopolized it for more than a hundred years.

Historical Facts of Currency

The historians argue that coins, bills, and paper currency are the latest inventions since, for a long time, modern world culture mainly utilized ordinary objects like cows, crops, and ivory as means of payment, which were bartered in exchange for other goods or services. Before the emergence of modern banks and financial institutions, people believed that they had the strongest security in religious temples where they normally kept their money. In 1875, the first U.S. dollar was issued. The currency sign ($) that was adopted to symbolize U.S. dollars was already in use before the issuance. The sign was mainly used to represent a foreign currency. History presents that the first paper currency was utilized in China in 800 A.D. In modern cultures, there are approximately 170 diverse kinds of currency around the world, and the world’s currencies, which are in physical money, are around 8%. In 1865, the U.S. government formulated a secret service during the Civil War era to fight against an alarming number of counterfeit currency (Kregel, 2016). Counterfeiting currencies had been a huge challenge back then, and at the end of the Civil War, most of the U.S. paper currencies in circulation were counterfeit.

Currency in the Modern Day Cultures

The use of modern currency fits into modern-day cultures since it is used daily to exchange and medium for transactions for paying bills and purchasing goods. Currency has positive impacts on modern-day cultures since it enables people from different cultures to participate in trade globally (Simmel, 1991). In modern cultures, people are advancing as technology improves; hence the adoption of electronic forms of currency and credit cards is highly valued in the modern world. Therefore, the interdependence of material and personality relationships commonly in the form of a barter trade economy will be eradicated by the emergence of modern-day currencies such as bitcoins. Since the interest of people’s participation in an association is mainly expressed in money, hence money has slipped like an insulating layer that exists between the objective totality of the association and personality is subjective (Gibb et al., 2015). Therefore, the virtue of colorlessness and impersonality that is peculiar to currency in contrast to certain values should be progressively increased if we adhere to the course of cultural development in the modern world. The currency will compensate for an ever-alarming quantity and variety of things hence performing incalculable services. Currency fits into the modern-day culture since it gives a common basis of direct joint understanding and equality of directives that leads to an extraordinary amount of producing that dissimulation of humans played a vital function in the social and cultural history of the previous year (Eichengreen et al., 2019).

Currency Influence on Language

Currencies have a positive influence on the languages in modern-day cultures. Since currency is the only medium of exchange that is accepted globally, for people who are from different cultures to operate together, they must have a common language like English to facilitate effective communication and mutual understanding. Hence, people will have to learn other cultures language (Fritz et al., 2018). The emergence of modern-day currency has influenced people positively to have a common language, which will enhance communication on bilateral trade. Therefore, participation in the exchange currency business with people from different cultures can only be possible if the partners have a common language that they understand; hence currency has inspired the development of a common language in the modern world cultures.

Currencies' Effects on Globalization

Globalization refers to the rapid growth of interdependence of the world cultures, economies, and populations, which is brought about by cross-border trade in goods and services, flows of investment, information, technology, and people. Currency has a positive influence on global trade since without currency imports and exports of goods will not be possible (Fritz et al., 2018). Global trade is carried out smoothly around the world since the currency is used as a medium of exchange and a measure of commodities to be traded.