![]() However, some currencies are “pegged,” which means their value relative to another currency, such as the dollar, is fixed at an agreed-upon rate.Įxchange rates affect the cost of goods and services in a foreign currency. Most currencies are “floating,” meaning their value fluctuates depending on demand and supply. As a result, one currency is always priced relative to another currency, and this price is known as the exchange rate. dollars with British pounds, for example. Maurer says while the discovery proves nothing, what it “demonstrates-in the routinization, the standardization, and the mass production of these items associated with a political center- lends weight to the hypothesis that anthropologists and archaeologists have long held: that money emerges primarily as a political technology, not an economic technology.Via CurrencyFair's Website How Is Foreign Currency Priced?įoreign currency is traded in pairs: You buy U.S. There are two prevailing theories about the origins of money: that it was created so that merchants and customers could barter, or so that governments could collect taxes and debts. Zhao and his team speculate that the mint’s location-close to the presumed seat of the official city administration-could signal that “the minting activities were at least acknowledged by the local government.” But they hasten to add that conclusions can’t yet be drawn: “Political involvement in spade-coin production for further research,” they wrote. That’s because while this research proves how old this particular Chinese mint and its coins are, it doesn’t definitely conclude that the Chinese remnants are older than the Lydian coins “often cited as an alternative starting point for coinage,” says Selgin, who was also not involved in the research. And it doesn’t necessarily mean that China did it first.” George Selgin, director of the Center for Monetary and Financial Alternatives at the Cato Institute, says that while the discovery is impressive, “It doesn't change our basic understanding of when the first coins were produced. If such coins are found with evidence of fire damage, researchers can radiocarbon date them-but they won’t be sure “if that burning has anything to do with the time period during which the coin was used,” Maurer explains, or if the coins were instead burned in a haphazard fire.īut here, “you've got a foundry which is full of carbon residue associated with the production of the item itself,” Maurer says, which can prove how old the coins and mint actually are. Finding both coins and their molds is what allowed the researchers to radiocarbon date the mint, lending weight to their assertion that it’s the oldest known in the world.Ĭoins are typically discovered isolated or hoarded away from where they were made, stashed in the rafters of a house or buried in a hole in the ground, Maurer says, “completely divorced from any sort of context that you can definitively say was associated with the coins themselves.” The completeness of the discovery is what’s remarkable, says Maurer, who was not involved in the research. “But in this case, you’ve got the whole mint, and you’ve got the casts that were used.” Strong evidence, not proofĬoins are often found “bundled together and completely lacking any of the original context of their production or their use,” says Bill Maurer, a professor of anthropology at the University of California Irvine and director of the Institute for Money, Technology and Financial Inclusion.
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