What is the function of money?

Visualizing the history of money

Money is any medium of exchange used in payments for goods or services and can take many forms. From cattle and shells in ancient times to paper and blockchain today, money has taken many shapes and sizes. This infographic illustrates some of the major forms of exchange world cultures have used over the last 5,000 years.

Cryptocurrency acts as a store of value

Traditional money, dating back to its first known uses in ancient Babylonia, has many uses—it reduces friction in transactions by providing a common denominator of value (unit of account), acts as a single item accepted by many vendors (medium of exchange), and holds wealth as a store of value.

Fiat money is a currency with no intrinsic, tangible value

Unlike the gold standard, where a nation's currency is linked to the value of gold, fiat money gets its power from the public's trust in its value.

The Chumash manufactured shell beads for thousands of years, eventually as money

The practice was unique to the Chumash among North American Indians. Some researchers have made the case theirs was the first use of money on the continent.

While the Fed is involved in issuing new generations of cash, the way it adds to the money supply does not involve printers

The majority of money in circulation is credit, not cash. This credit, which acts similarly to direct deposit from employers, is added to bank accounts by the Federal Reserve. The Fed also employs tools like the federal funds rate and open market operations to expand or contract credit.

How banking works

To do big things, people often need more money. Banks jumpstart economic activity with loans paid back with interest, and when things are working well, both people and the bank make more money. Formed in the Middle Ages amid competing currencies in Italy, banks—from the Italian for bench, banco—helped stimulate that era's commercial revolution, a massive expansion in Mediterranean trade and development. Find out the ins and outs of banks in this quick explainer video.

The US dollar is the official currency of the United States and is the most circulated currency around the world

The US dollar was established in 1792 and comes in the form of coins or paper money. It's considered one of (if not the most) stable currencies in the world due to America’s strong and robust economy, as well as its relatively stable government.

Why Americans don’t talk about money

In the United States, asking someone how much money they make (or any questions about money, really) has long been considered rude. But where did this social norm come from originally? And why do Americans still feel so awkward talking about money? This article from The Atlantic takes a deep dive into the socioeconomic forces that created the money taboo. Read the full piece here.

Modern Monetary Theory 101

Modern Monetary Theory is a macroeconomic theory that says government spending should not be restrained by fears of rising debt. Here's a breakdown of how the theory works.

Money 'mules' don't always know they are laundering money

Money mules are anyone who receives money in a laundering scheme and then sends it forward, either to another company or to a financial institution. While some money mules—often called smurfs—actually work with criminals laundering money, getting someone to receive and then send money has become a popular scam.

The US dollar is the most widely circulated currency in the world, and is involved in nearly 90% of global transactions

How exchanges like the Chicago Mercantile act as trading referees

Chicago's Mercantile Exchange emphasizes futures contracts on commodities. This podcast episode breaks down how exchanges actually work, make money, and streamline the market.

What something costs is reflective of a balance in the market determined by the amount of demand relative to the supply of goods and services

Because economies are complex systems, a wide variety of issues influence this balance—including some things generally considered to be positive, like rising wages.

The US Mint created a video to show kids how coins are made

The video, made simple for children (or anyone who wants an easy-to-understand 101 video about the process coins go through to get in your wallet), outlines the entire process that a coin goes through in its lifetime, from Congress voting on new coins, to how coins are stamped, to their journey to a Reserve Bank.

Memecoins are a type of cryptocurrency—a form of digital currency with a wide variety of uses—created around popular 'memes,' or viral internet jokes.

The IMF was created to prevent the currency crises that destabilized the 1930s global economy

Founded in 1945, the IMF monitors exchange rates, promotes financial stability, and provides emergency funding to countries that cannot pay for their imports. It currently has 191 member countries and acts as a lender of last resort for struggling economies.

An economist answers questions about love

Economists aren't exactly known for their dating advice. But as it turns out, economics experts can offer fresh perspectives to everyday romantic quandaries. On this podcast episode, economist Tim Harford answers listeners’ relationship quandaries, from paying for a first date to alternatives to saying, "I love you." Listen to the episode here.

The US national debt has become more important in recent months

In a moment of deep economic uncertainty, the national debt now matters more than ever. Listen to this podcast to find out why and also explore answers to questions like, "Who does the US owe money to and why?"

What exactly is college for?

The rising cost of college has many of us wondering, what exactly is a college education for, anyways? This "Freakonomics" podcast episode breaks down how colleges operate like large businesses and try to differentiate their products from one another to win market share. To find out what the overwhelming higher education system is doing wrong (and what it gets right), listen here.

Why does the stock market matter?

Open any newspaper, turn on your local TV news station, or listen to a daily business radio segment, and you’re bound to hear about how the stock market is performing. Netflix created a 17-minute (free) explainer that dives deep into the nitty-gritty of how we got here.

In defense of the advertisement economy

Advertising is frequently reviled for how it clutters up public spaces and our everyday experiences. Nonetheless, it allows for vast amounts of goods and services to be rendered free to millions of users—and gives users the option to pay with money or time and attention.

Why atoms are used to keep track of time and define the meaning of a second

Small variations in the production of human-made devices, such as mechanical watches and pendulums, make them unreliable for the ultraprecise timekeeping required by modern technology, including financial transaction timestamping and GPS. Because atoms obey fundamental laws of nature and never wear out, their light emissions when energized provide a consistent timekeeping signal.

All computers are defined by their ability to input, store, process, and output data

From wooden machines to wearable tech, computers have changed a lot in appearance, but they all still perform the same essential tasks. Early computers were made of wood and metal—some were so big that they filled entire rooms just to solve simple math problems.

Does money buy happiness?

Perhaps you've heard of a 2010 study that found more money actually does correlate with an increased level of happiness, but after $75K per year, the happiness level didn't significantly increase. As it turns out, new research has complicated those findings. Listen to this podcast episode for more information.

How mutual funds work

Investing in mutual funds can give you access to a wide range of securities, such as stocks and bonds, with just a single investment. Mutual funds are one of today's most common investment options. There are different types of mutual funds, such as stock, bond, money market, and target-date funds.

The Fed operates within the open market as a competitive bidder of interest rates

Because it’s viewed as a risk-free platform to earn interest, whatever rate it sets becomes the default benchmark. To maintain its target rate prescribed by the Federal Open Market Committee, the Fed has various tools it offers both commercial banks and home loan institutions.

What's the point of pain?

It's notoriously hard to define pain, though everyone knows what it is. From day to day aches to the worst pains imaginable, this video goes into what researchers know about the purpose of pain. An estimated quarter of all adults live with chronic pain, which is defined as at least three months of pain.

Some coin denominations have ridges etched on their sides, partly to prevent counterfeiting, in a practice called 'reeding.'

Roughly 43 million US borrowers owe roughly $1.7T in student debt, the second-largest source of consumer debt behind mortgages.

The idea for the Federal Reserve was conceived in secret in 1910—with bankers donning duck hunt gear for disguise while traveling to a remote country club on Georgia's Jekyll Island

While atoms are normally made of protons, neutrons, and electrons, exotic ones have been built with antimatter—alternate versions of normal matter that live for fractions of a second and are about a billion times as rare.

See how fireworks are made and learn how metals like magnesium and copper are responsible for different colors.

Hedge funds, the private investment firms that trade a wide swath of financial assets, make money by imposing steep fees on investors and from the fund's investment performance.

The first steps to rebuilding your credit score include getting to know exactly what's on your credit report and figuring out how far you are from the '700 club,' or 'good score' range.

The price of gas is a composite made up of several different factors, with the federal gas tax making up less than 20% of what drivers pay at the pump.

SpongeBob exemplifies Aristotle's philosophy for living well because he understands that happiness doesn't come from external factors like money, recognition, or power.

Use this calculator to find the dollar value of your mental load, from meal planning to coordinating after-school care for your children.

Some researchers have labeled nomophobia, the fear of being without your phone, as 'the phobia of the 21st century.'

How Amazon operates a 'flywheel' business model, a self-reinforcing cycle that drives continuous growth

Art theft is the third-largest source of criminal revenues worldwide, thanks in part to the subjective nature of valuing a work of art.

Apollo astronauts left items in the moon's 'toss zone,' including golf balls, family photos, and bags of human waste, to make room for lunar rocks.

Pure water does not conduct electricity because this flow of energy requires the movement of charged particles, and water is a neutral molecule.

Long before Major League Baseball began allowing instant replay for balls and strikes, an umpire reluctantly used the technology to determine whether a hit was a home run, a move that inadvertently ushered in a new era for the sport.

A century of Billboard issues documenting the evolution of popular music.

The most expensive ad of all time was for Chanel No. 5 perfume and cost roughly $33M to produce in 2004—about $57M in today's dollars.

Chaos theory—informally known as the butterfly effect—is the reason why weather forecasts are presented with probabilities rather than certainties.

The word 'jazz' evolved from 'jasm,' 19th-century American slang for 'energy'

This site reaches millions of visitors who are tired of AI chatbots and seeking human connection. Pretend to be an AI chatbot and ask questions, provide answers, and draw for people in real time.

Researchers believe the brain consolidates memories, processes emotions, and plans for the future during dream states

The first robot in literature may have been a 'mechanical man' in 1907's 'Ozma of Oz,' a book in L Frank Baum's 'Wizard of Oz' series.