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Paying for parking, shopping, a bank account – it is difficult for a modern person to imagine his life without cash and debit cards. Today money is not just a means of profitable exchange, but an irreplaceable attribute of everyday life. Read about money and its purpose in the article.

Money is a universal measure of value and a medium of exchange familiar to every person. If in ancient times shells or furs were used as money, today it is not even necessary to have banknotes with you to buy, a plastic card or smartphone is enough. When the first money appeared, what it is and how much money the capital has – in the continuation of the series of publications “Moscow Economy in Simple Language”.

History of coins and the first banknotes

The first money appeared in the 7th century BC. Stones and shells were used as means of payment. Cowrie shells became especially famous: due to their small size, they were easy to transport and use. Shells were used to pay in Africa, India, China and the Pacific Islands. Pearls, valuable products (rice, salt, fish, cocoa beans), cattle and skins of rare animals were also used for payment.

In Russia, money began to be used in the 9th century. Goods were exchanged for stones, food and furs, which were also highly valued in other countries, for example, in the Byzantine Empire. From there they brought to Russia gold and silver coins, which were exchanged for furs.

Own copper money appeared in Russia at the end of the 10th century. The first silver bar was minted in Nizhny Novgorod. The ingot itself began to be called the ruble, and half of it was called a half.

The history of paper money began in the 7th century in China, when traders began to write down the debts of townspeople on sheets of paper. These records are considered to be the first banknotes. In Europe, banknotes began to be used in the 17th century – first in Sweden, and a little later in England, Norway, Denmark and France. In Russia, paper money appeared a century later – during the reign of Catherine II. They looked like IOUs and were called banknotes.

Monuments to coins can be found in different cities of Russia. In Moscow, there is a monument dedicated to five kopecks. It is located in the park of the 850th anniversary of Moscow and is called “Happy penny”.

Unique shapes

Money has several different types. Some of them are outdated, others continue to be in demand.

Commodity, or natural, money is called valuable items, food, animals and everything that could be useful in everyday life or trade. For example, skins were used to make clothes, and salt was needed for cooking. In the XVI-XVII centuries, money made of gold and silver was considered commodity, because it could be melted into household items or jewelry. Today, such means of payment are no longer used.

Secured, or representative, money is not in use now either. These are certificates or items that could be exchanged for a product. The most famous of them are clay figurines of sheep and goats, which the ancient Sumerians exchanged for real animals. By providing a certificate, one could receive gold and silver.

Another form of money familiar to many from films or even from personal experience is loan money. These are the means that can be used to pay for a purchase or service for some time, and not immediately. This form of money has several types. The first was a bill of exchange – a written obligation of the debtor to pay the agreed amount of money on time at a specific place. By the way, these securities appeared in Ancient Greece, but acquired their name later in the Germanic principalities.

Another form of credit money is a check. According to this document, one person can receive money from the account of another. To do this, the owner of the check must have a bank account and a form on which he should indicate the amount and sign.

Real money

Coins, banknotes and electronic money that modern people use almost daily are called symbolic. They are also known as fiat or decree.

The main feature of symbolic money is that it acquires value only when the state regulator has assigned it a status and declared its value. The production of such money is much cheaper than its face value, therefore, over time, it became the main method of payment. And only the central bank of the state has the right to issue fiat money, in our country it is the Bank of Russia.

Coins are made from metal of a certain weight and value. They can be used for payment, investment, or as a collectible gift. For example, in the 1920s, a half-kopeck coin existed in the USSR, and in 1991 a 150-ruble coin was issued. Today, collectors estimate the cost of the latter at about 40 thousand rubles.

Paper money is made from cotton, less often from flax or abaca (herbaceous plant). Some banknotes are composed of fabrics and special types of plastics and are called hybrid money.

Today, banknotes are made using innovative technologies. For example, new Russian banknotes of 200 and 2000 rubles are issued using augmented reality. If you inspect them using a special application, you can see flying birds or cars passing over the bridge.

Electronic money is the money of the future

One of the youngest types of money is electronic. The first mentions of them are found in the United States in 1918, when the Americans managed to make the first money transfer by telegraph. Half a century later, a special clearinghouse for electronic services appeared. By using personal checks, it was possible to carry out remote financial transactions.

In the 1960s and 1970s, electronic money was stored on computers in the form of tables and registers. In the 1980s, bank cards came into use, and after another 10 years, the first electronic wallets appeared. In Russia, the first payment system – PayCash – appeared in 1998.

The money that is stored in virtual accounts cannot be cashed, it is non-fiat. They can only be used to receive electronic services: pay utility bills or the Internet, top up your mobile phone balance.

One of the most talked about types of money today is cryptocurrency. At its core, it is not even electronic money, but a complex mathematical code. It exists only in the virtual space and is not tied to any existing currency. Such a currency has an unstable rate, which depends only on supply and demand. There are more than 800 types of cryptocurrencies in the world, and the first of them was bitcoins.

Muscovites in five years began to withdraw cash from ATMs by 40 percent lessMore than 6.5 million transactions since the beginning of the year: urban payment services have become even more popular

City budget

A city budget is a complex financial mechanism that requires clear planning to keep it running. Moscow pays special attention to this issue. The city draws up a three-year plan and predicts how much money will be directed to each area, in which sectors it is necessary to invest in order to return the invested money in an increased volume.

The budget of Moscow is socially oriented – more than half of the funds are directed to the development of health care, education, and support of unprotected citizens. The capital also supports projects to improve infrastructure, invests in road construction, transport development, and the creation of a comfortable urban environment.

Moscow budget expenditures in 2021 amounted to 1.2 trillion rubles. They were aimed at the implementation of the most important city programs for the development of the transport system, education, health care, culture and other areas. On the portal “Open budget of the city of Moscow” you can get acquainted with the plans of the capital for this year and for the next few years, study information about the planned expenses and how much money has already been spent.

If we talk about income, then in the six months of 2021 the city earned 1.3 trillion rubles. Moscow’s main source of income is taxes. Also, the budget is formed through the lease of city property, the provision of paid services, the sale of assets, administrative fees, fines and through private investment.

In the first quarter of this year, the volume of investments in the city’s economy grew by 17 percent, and over the past 10 years it has more than tripled, said the Deputy Mayor of Moscow for Economic Policy and Property and Land Relations Vladimir Efimov.

Moscow is in the top of the most attractive megacities in the world for life… Thanks to balanced management decisions, clear planning and focus on investment, the Russian capital has caught up with many European cities in terms of living standards and well-being of citizens.

The Moscow City Duma adopted the budget of Moscow for 2021 and the planned period of 2022 and 2023 More functions and information: what has the updated Moscow City Open Budget website become?

EDITOR’S NOTE: This article is a translation. Apologies should the grammar and or sentence structure not be perfect.

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