History of money

The video discusses the history of money and how it evolved during that time. Back in the 1700s people used to pay with physical gold and silver in exchange for goods. Then, however, they started realizing that this is not a very handy thing and notes were introduced which represented a certain amount of gold and silver and became the new currency. This idea developed over time until the 1970s when money became mostly fictional. Banks could give out loans based on a 9:1 ratio of loan money to actual reserve money. By doing this, the banks created more money than actually existed and earned a higher profit on their loans. Today, all of the money is fictional. Banks only hold a tiny amount of money in their reserves and make loans on a fictional base.