This is the latest chapter to be published of my new 2024 edition of The End of Money and the Future of Civilization. It continues the story begun in the previous chapter of how money has evolved and changed its character over time.

Here is a brief excerpt:

Money has become merely an accounting system, a way of “keeping score” in the economic “game” of give and take. —Thomas H. Greco, Jr.

Let us begin by summarizing the evolution of the various kinds of money that have been used to mediate reciprocal exchange:

1. The circulation of gold and silver coins gave way to paper banknotes that were redeemable for gold or silver coins, which made the notes essentially warehouse receipts for gold on deposit.
2. Then, banks began to lend bank notes into circulation based on the pledge of collateral assets (some valuable and others not) other than gold, some of which included government obligations (bonds, notes, etc.).
3. But ALL notes were redeemable in gold. This became known as the “fractional reserve banking” system.
4. Bank account balances (checkable bank “deposits”) increasingly took the place of paper bank notes, and bank customers began to write checks against their deposits instead of using bank notes to make payments.
5. As banks created ever greater amounts of non-bona-fide money based on national government debts and other illegitimate collateral assets, the fiction of gold-backing and redeemability could no longer be supported, and governments reneged on their promise to redeem their currency for gold. This broke the final link between political fiat money and the real economy of valuable goods and services.
6. But, despite that, the emergence of credit clearing to offset credit obligation against credit claims was a major leap forward in facilitating the reciprocal exchange of value.

For now, you can read or listen to the entire chapter at Future Brightly:

Chapter 10—The Third Evolutionary Stage—The Emergence of Credit Clearing-Text
Chapter 10—The Third Evolutionary Stage—The Emergence of Credit Clearing-Audio narration

It will also be published soon here, and on my own Substack channel. Further chapters will continue to be posted as they are completed. Watch for Chapter 11 to be posted soon.

As always, your comments and suggestions are welcomed,
Thomas