Kansas Snapshots by Gloria Freeland - July 4, 2025

Money matters

Modern economies rely on easily swapping something widely seen as having value. Without this, each person or family would have to personally provide for all their own needs or barter with neighbors. Gold and silver were an early medium of exchange, although no one seems to know just why. It's been suggested that in ancient times, unusually attractive things could be made from these comparatively rare metals, causing them to be coveted.

Coins containing standard amounts of gold or silver facilitated the exchange. The word money comes from the Latin "moneta," meaning "mint."

Joachim’s Thal - German for "Jacob's Valley" - is in the Czech Republic's far northwest corner. In the 16th century, a Bohemian version of the gulden, a common coin of the time, was minted from the silver of the valley's mine. Having a bit less silver than the standard gulden, it was initially called "Joachim’sThaler," then just "Thaler."

A "piece of eight" was a Spanish coin worth eight Reales. In the English-speaking world, thaler morphed into dollar and a piece of eight was called a Spanish Dollar. This coin was prevalent in North American commerce during the colonial period, leading to our basic unit of currency being called the dollar.

Early versions of our paper money were seen as contracts. They contained wording, such as "in silver payable to the bearer on demand." We stopped putting gold in our coins in 1933, and by 1971, silver was also eliminated. Today, the connection between precious metals and the dollar have been completely severed. The stuff in our wallets and pockets is worth only what people mutually agree its worth.

Bible verse 1 Timothy 6:10 says, "for the love of money is the root of all kinds of evil." But without money, economic exchange would be hamstrung, making life as we know it impossible.

When I was young, buying and selling involved cash or checks, although it could be argued that a check is really just a contract promising to transfer cash. However, there was a subtle, yet important, difference. Cash purchases involve real objects changing hands. The buyer's notes and coins are transferred to the seller. But with a check, typically what happens is numbers in the buyer's bank account are reduced by the amount of the selling price, and the seller's account numbers are increased by an equal amount.

Rapid credit card growth in the 1960s greatly facilitated a shift toward a cash-less society. Buying and selling now is becoming little more than adjusting ledger figures.

Exploding internet commerce continues to accelerate this shift. "Paying" my electric bill only involves the electric company's bank account being bumped upward by the same amount my personal account is lowered.

A person traversing international borders might also cross currency and banking borders, creating economic complications. When I first traveled abroad, I went to a bank and exchanged dollars for the currency of the place I would be visiting. The bank's fee made this a costly proposition. Traveler's checks made it less costly and easier as they could be converted with minimal effort into the local currency. Credit and debit cards have largely eliminated both of those money-conversion methods.

While abroad, using a debit card to obtain the local currency is still the primary method of dealing with day-to-day transactions. But smartphone applications are quickly gaining ground.

Two years ago we were in a German town where street parking could only be paid by using a smartphone. Our "adopted German son" Tim and family met us in Prague. During our time together, he made all his payments with his phone. British friend Courtney said she has paid almost all her bills by phone for years. Husband Art and I noted that many of the parking machines in Britain no longer accept cash. However, a Berlin restaurant where we ate in May only accepted a credit card I had never heard of or cash. So being flexible is still important ... for now!

Cryptocurrencies have no physical tokens like dollar bills or Euro coins. Furthermore, accounts exist only in the form of computer data that rely on cryptography and distributed record-keeping to ensure accuracy and thwart theft. They have the real advantages of transaction speed and availability of money whenever one has internet access. They also require no border-crossing conversion, and, if properly implemented, a third party - such as a government - can't tax, seize or steal those assets.

But some of these traits can be misused, allowing criminals to easily hide and move wealth. And the fact that there is no widespread agreement as to the value of most of them opens the door for currency speculation. A well-known person can let it be known that he or she is buying such a currency, causing others to think they should too, driving the price up. The first person then quietly sells, reaping a profit. So being heavily invested in a cryptocurrency currently means you can go to bed a poor man and wake up a rich one ... or the reverse.

Bitcoin is perhaps the most well-known cryptocurrency and uses a complex mathematical algorithm for ensuring the accuracy of transactions. Understanding the details are about as important as being knowledgeable about the process of making a dollar bill. The "problem" with such currencies is that their limited circulation, combined with no value regulation, leaves them vulnerable to widely-fluctuating values.

Over the years, I moved from using cash to checks, but with some apprehension as I worried about security. When that was allayed, I shifted to using first credit and then debit cards, but not without some concerns over safety. Then I moved on to transacting much of my business online. Now, it appears a smartphone "digital wallet" - a wealth management system that has better security than those I currently use - is on the horizon.

But a cyber currency? I'll pass on that ... at least for now.