That's right, cows (cattle) were among the first things used to trade for goods and services. Back then there wasn't much else you could use, as people lived like cavemen. In some parts of Africa during this century, cattle were still being used as a form of money.

     People started settling down and growing crops, and what you grew became a way of paying for things. Grain was better "money", because you could store it for a while, and it never would run off!

     Grain worked for a while, but people started to complain that it was just too bulky. Imagine trying to carry 50 pounds of wheat to the mall to buy some shoes! So, governments came up with the idea of having coins as money. They were a lot easier on your pockets!

     Some places started using pretty shells as money. These shells, called "cowries", were the longest used currency in history. Some countries even traded tools to get what they needed.

     As the money situation grew more and more complex, governments had to step in and regulate things. Coins were being created out of precious metals like silver and bronze, but how could you know that a coin was really bronze? For that matter, was a 10-ounce coin really 10 ounces? One of the first official duties of governments was to insure a common currency, so everyone would be happy.

     When governments issued a standard currency, they found that their nation's money was more widely accepted all over the place, and their trading influence grew. This was a big motivator to countries to start keeping themselves big and strong, so people would trust their kind of money and use it more.

     Around this time, banks started to exist. People wanted a safe place to keep their money, and at first this was the only reason banks were around. But soon the banks found that they could make money themselves by loaning money out to people. The basic concept of banks has never changed since way back thousands of years ago!

Did You Know?

The ancient Incas didn't use money for anything, they had no need for it!