It is no surprise that Jacob Goldstein, one of the minds behind Planet Money, produced an entertaining and enlightening guide to money from (nearly) its very beginning up through cryptocurrency. It is a combination of excellent stories with a lot of economic insights. Ultimately, Goldstein argues that money is whatever people think it is—and that most of the previous innovations in money have been less about the deliberate design of a new money and more backing into it, often when the government comes to the rescue in a crisis establishing the principle that whatever it was was indeed money.

It begins with the origins of metallic money and then shifts to China which invented paper money but then basically stopped using it (coincident with it stopping a lot of elements of its economic development). The story then shifts to goldsmiths in England who had what were essentially claim checks on gold that themselves became money. The story expands out beyond money narrowly defined to the origins of finance, including joint stock companies, banks and lending, public debt, life insurance, money market funds and much more. It has nice capsule biographies of John Law, the early history of crypto and much more. At times the book stretches the definition of “money” to fit subject that Goldstein seemingly wanted to include, but at times innovations themselves stretched the boundaries of what is money.

In all of this developments and innovations in money result from a combination of technological change (e.g., ability to make paper), political change (e.g., the sovereign of France needs money for wars), social changes (e.g., the empowering of the mercantile class), and is both a cause and a consequence of economic changes (e.g., greater divisions of labor).

Near the conclusion Goldstein has a nice version of this history of money and how crypto has, so far, been the exact opposite: “The history of money is largely the history of stuff becoming money without people really realizing it. Banknotes and then bank deposits started out as a record of a debt and sort of crept their way into being full-blown money. Shadow banking grew for decades before anybody thought to call it shadow banking. It was only in moments of crisis—the moment when the thing suddenly threatened to become not-money—that everyone looked around and said, well, I guess banknotes and bank deposits and money-market mutual funds are money now. The history of electronic money is exactly the opposite. Someone—David Chaum, Satoshi Nakamoto—has a very clever technological breakthrough. Then they climb up to the mountaintop and proclaim to the world: ‘Here is a new kind of money!’ And then it doesn’t really become money. Or at least it hasn’t yet.”

Highly recommended, I got a lot out of it even though I knew many of the ideas already, and if you do not do not worry—Goldstein is an excellent guide.