There was a discussion in the chat room recently about the silliness of paper money and it led to a conversation covering the fascinating history and reason behind various sorts of money.
Goods and services can be traded for what goods and services another person may need. This works on a small and short term scale, and the resources will be practical things such as cloth, food, livestock, labor, or land, but there comes a point where that is impractical.
If you have a great number of beets and your neighbor offers more to you in exchange for something else, not only do you have no current need, but they may go bad before you have a chance to eat or spend them. Beets also take up more space than you have, but you don't have the space now to trade them for goats.
This is where precious metals and stones come in. They are worth more, take up far less space, and the metals are still very practical and useful, but won't spoil or need feeding like other goods. So you can trade your beets for a sack of silver and use the silver to buy your goats later.
Later, when your pockets become to heavy when you go to make expensive purchases, another respectable neighbor offers to hold your silver for you in his barn. He gives you a receipt for every five pounds of silver he holds, and you, bearing these much lighter five pound notes, can go and trade them for goods and resources and your neighbors can give the banker the receipts so that they may have the silver you owe them by paper.
Of course, if the barn is robbed, the papers are no good, but that is how the idea works.
So how do your cultures do business? Do they barter? If they have coinage or precious goods to trade, what is the most common? Is it a substance unique to that world? Do they use banks and paper? Banks and plastic? If it is a science fiction, do they use records on the internet like credits? On what standard does your interplanetary alliance run? Are they off their standard and no one knows? Discuss, share your thoughts, and explore the vast world of fantasy finance.
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