I want you to imagine something. It’s pay day, but you receive no direct deposit or physical check. Instead your boss has another idea. He offers to pay you in a mixture of scented teak wood, containers of coffee, and bolts of silk.
Weird, right?
But I’m sure you’d be angry, even if the wood, coffee, and silk were of a higher value than your normal check. It’s just not the way things are done today.
Likewise, when you walk into a store and ask how much something costs, you don’t anticipate the clerk to tell you what they’ll trade for it. You expect an exact total in dollars, pounds, euros, or yen.
But it wasn’t always this way. Oddly, it’s due in large part to the ancient Greeks. We may imagine them as philosophers, warriors, and mathematicians, but they were also great merchants and traders.
While they didn’t invent money, they had a hand in putting an ethos behind it for its use in the greater world. Coins were even used as teaching tools. Not only for trading purposes, but for life lessons as well.
Over thousands of years, these monetary valuations became part of our lives. In fact, it’s hard to imagine a world without them. Although the ancient Greeks can also demonstrate what this pre-money civilization looked like.
Namely, the lesson comes from Homer.
Homer’s Cashless Society Couldn’t Afford Blue
While we consider “cashless” as involving a payment app, the Greeks in Homer’s time (1200 to 800 BC) didn’t have that luxury. They used cattle, not coins. In other words, these Greeks gave a value for items in how many cows you could get in trade for them.
Tim Brinkhof at Big Think notes Homer describes “the gold tassels of Athena’s aegis” equating to a hundred oxen in the Iliad. It makes sense in many ways. The animals had value for not only food, but for sacrifice in a religious society.
Homer’s world also used similar workarounds for daily life.
Nassim Taleb in his book “Antifragile” references an oddity in Homer’s works. In both the Odyssey and the Iliad, the Greek repeatedly refers to the sea as “oînops póntos” or wine-dark.
Taleb interviews a linguist who explains ancient cultures didn’t have the same depth in vocabulary for color as we do today. So, Homer’s Greeks likely didn’t have a word for blue. Or at least no name for the shade of the sea that day.
However, the Classical Greeks of later years found an easier way to express value we’d be more familiar with today — coins.
The Classical Greeks And The Athenian Trading Empire
“As currency, coins were far more practical than farm animals, so practical, in fact, that they fueled the creation of entirely new industries and even facilitated the rise (and fall) of several ancient superpowers, notably Athens.”
— Tim Brinkhof, Big Think
One of the first known coins was the Lydian Stater in the 6th century BC. The Kingdom of Lydia existed in Asia Minor, between the ancient Greeks and Persia. However, Brinkhof explains the reason for the coin’s existence is a mystery.
It was made of a durable and valuable metal called “electrum,” but the smallest value coin Lydia produced was equivalent to a day’s worth of labor. This leaves a hole. For instance, how can you use it to pay for a single piece of bread?
Brinkhof notes some theorize Greek mercenaries brought these coins home with them, which caught the interest of the local authorities.
Native coins first appeared in Greece near Athens. First used for taxes and fees to the government, they eventually spread to all areas of life. Suddenly value had a universal expression. According to Brinkhof:
“…Ancient Greek coins acquired a semantic significance that primitive money never possessed. The Greeks were keenly aware that money allowed them to express everything in terms of a single, standard unit, redrawing the relationship between objects.”
It also bolstered Athens to incredible power. After the Athenians and their allies defeated the Persians at the Battle of Marathon, there were wide celebrations. However, the Athenian politician Themistocles saw it as luck.
He talked the city-state into investing money from new silver mines into a fleet large enough to challenge the Persians.
While the fleet was created for defense, it also turned Athens into a great trading empire powered by coinage. The trade and duties taken in swelled their treasury.
In Victor Davis Hanson’s A War Like No Other he explains the Athenians had a surplus of six-thousand silver talents in reserve before The Peloponnesian War started with Sparta. So, how much is that? Hanson equates it to three billion dollars in modern money.
While the war exhausted the Athenian treasury and ended the Golden Age of Greece, the idea of an empire built on coins was firmly etched into the Greek mind. A Macedonian later put it into practice.
Alexander The Great’s Money Machine
“Most Egyptians relied on barter or used silver or copper as monies of account. Only the pharaohs priests, or a few others paid in silver or gold bullion. Money was not an important form of wealth. Now, Cleomenes started Egypt’s first mint. And Alexander continued to open mints as the empire expanded.”
— F.S. Naiden, Soldier, Priest, and God
As Alexander the Great set about to conquer the Persians, he needed to do more than win battles. He needed to set up an economic system. The Macedonian started the expedition in hoc up to his eyeballs and needed to pay off debts and soldiers.
In his book above, F.S. Naiden says the Persian Empire was a rich target, but perceived wealth differently from the Greek world. For instance, the desired province of Egypt had no mints to make coins.
But this wasn’t unique.
Many parts of the Persian Empire had no method to coin money. So, Alexander not only spent time fighting battles but establishing mints all over to create the coins to pay for troops and building projects.
For the Persian rulers, wealth wasn’t expressed in coins, which became apparent as the Macedonians raided Persepolis. Naiden sums it up neatly, describing what Alexander’s army found:
“And more and more gold and silver dwarfing what Susa provided. The inspection teams tallied sums that would be absurd as billions today. And for what? The Persians minted only a fraction of it. A king like Darius would say that Persepolis showed he was rich in the most important currency: gifts.”
Alexander not only captured an empire but monetized it. He used the gold and silver hoarded by the Persians, turning it into a modern transferable coinage often toting his face. Although in certain ways Alexander had a personal view of money like Darius.
While he used the coins to pay soldiers, restore temples, and settle debts, he didn’t care for wealth.
He preferred to conquer and explore. After returning from his India campaign, he demonstrated this on a grand scale by paying off all his soldiers’ debts.
You can’t fathom how incredible this is until you realize he had tens of thousands of soldiers with him on campaign. Stunningly, it didn’t dent his treasury. According to Naiden:
“He was still the richest man in the world; the richest who’d ever been. The coins he minted for his troops and government contained more gold and silver than the US currency of the sound money decades after the Civil War. That made him richer than all “gilded age” American millionaires put together.”
While Alexander’s empire shattered after his death, he spread not only ideas, but coins and mints across the known world. And that brings us back to the present day.
A Philosophy Of Money
“Pay the price it’s sold for if you think it’s worth it. But if you want to get it without paying up, you’re being greedy and stupid.”
— Epictetus, the Enchiridion, translated by Anthony Long
Epictetus is one of my favorite philosophers. And one of his brilliant lessons involves a Greek coin called an Obol, which he trades for a head of lettuce. He uses it to explain all things have a cost.
In other words, nothing is free, even desires. It’s appropriate beyond words a great Greek philosophy would use a coin to explain a life lesson.
The culture not only gave us logic and mathematics, but a system of value and a base where we could grow our economies. All from simple coins. Think of that every time change rattles in your pocket.
-Originally posted on Medium 9/12/22