[legulere]

It's the other way around. First there was personal debt, then impersonal money.

In the beginning you would just lend stuff from other people and give it back, or with consumables give something back of similar worth.

Precious metal was pretty rarely used, as its main benefit is that you need almost no common trust relationship.

[jasonwatkinspdx]

I see you've read Graeber. Great book and changed my views on a lot of things, particularly how much of our "common sense" understanding/education on topics relies on "just so" assumptions made by some aristocratic scholar a couple centuries ago.

Anyhow, to explain for the forum: Graeber's book goes through the evidence we know of from the places were money first appeared. In essence, debt came first, and money was a later innovation. Very interestingly temple records using tally mark schemes may have been what lead to the development of cuneiform writing in the levant. A similar debt first pattern appears in other places, at other times too.

Coinage, particularly metal coins, came about much later as a clever hack by rulers to simplify raising and maintaining a large army. Pass a law demanding all citizens pay you X coins each year. Pay your soldiers in coins. Suddenly your society is figuring out how to feed and house soldiers, without you haven't to build a command hierarchy to run it all directly.

I can't recommend this book enough. It's dense in parts because he goes into a lot of detail that fully justifies what he's saying. Still, completely fascinating to learn much of the way we think of economic history is mythology. It's also a great lens for understanding what's happening now with cryptocurrencies.

[nostrademons]

> It's also a great lens for understanding what's happening now with cryptocurrencies.

Expanding on this - one of the brilliant innovations in Bitcoin was to make the ledger fundamental and the coin an implementation artifact. The blockchain doesn't store coins - it stores a ledger of who transacted with whom, and for what amounts, and then ownership of a Bitcoin is a derived quantity from the transaction history. Ethereum just expands that ledger to let smart contracts on the blockchain define other quantities to track, as well as the rules and relationships between them.

It's completely backwards from how I would've thought to implement a cryptocurrency, which would be to start with the coin and figure out how to make its ownership distinct & incorruptible. By starting with the ledger first, you don't need to think very hard about ownership (because it's all recorded in the ledger), you just need to find a way to define a source of truth for the transaction history.

[michaelrpeskin]

Yeah. That’s a great way to describe it! It’s like a differential equation where the fundamental function is the change and you have to integrate it to find the state. Traversing the blockchain is like integration.

[imtringued]

Yeah this is true, people didn't necessarily "barter" back in the day. Traders and merchants probably did because they wanted immediate payment, but within a trustworthy community you simply record or memorize what you did and demand the other side to pay you back in the future.

An oversimplified hunter and gatherer society would just let the hunters give meat to the gatherers, assuming that they will one day be paid back with gathered vegetables or fruit.

[6gvONxR4sf7o]

Describing it as debt makes it sound like people tallied it, which I believe they didn’t for a long time. It gets the facts right but uses a very modern way to frame it. I think it’s more accurate to look at it as reciprocal altruism. I do you favors, you do OP favors, OP does me favors and we do so so long as it feels like nobody is mooching.

It’s the difference between 1) going out to a bar with friends and remembering “Alice has bought the group X rounds, Bob has bought Y rounds, and I’ve bought Z, meaning it’s Bob’s turn to buy a round because he is in beer debt” and 2) “Alice and Bob and I generally buy each other rounds and it all feels roughly balanced so I’ll buy this round.” Tracked and tallied debt came much later as I understand it.

[grafporno]

Strong disagree, people tallied it basically from the start, e.g. https://en.wikipedia.org/wiki/Tally_stick