The Birth of Money

Gold has shaped human history for several millennia. But how and when did it first turn into currency? And what can it tell us about the birth of money? In today's episode of The Ancients, Tristan Hughes delves into the origins of money with TV producer, author and professor Alan Ereira. Together, they reveal the intertwined origins of commerce, trade, and coinage and journey through the history of ancient money - from the earliest use of gold by the Varna Culture 6,000 years ago, through to King Croesus's revolutionary minting of pure gold coins in Lydia and the first ever financial crash. Presented by Tristan Hughes. Audio editor is Aidan Lonergan, the producer is Joseph Knight. The senior producer is Anne-Marie Luff. The Ancients is a History Hit podcast. Sign up to History Hit for hundreds of hours of original documentaries, with a new release every week and ad-free podcasts. Sign up at https://www.historyhit.com/subscribe. You can take part in our listener survey here https://www.surveymonkey.co.uk/r/6FFT7MK: https://uk.surveymonkey.com/r/6FFT7MK Theme music from Motion Array, all other music from Epidemic Sound Hosted on Acast. See acast.com/privacy https://acast.com/privacy for more information.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Tristan Hughes?

  Ever wondered why the Romans were defeated in the Teutoburg Forest? What secrets lie buried in prehistoric Ireland? Or what made Alexander truly great? With a subscription to History Hit, you can explore our ancient past alongside the world's leading historians and archaeologists. You'll also unlock hundreds of hours of original documentaries with a brand new release every single week, covering everything from the ancient world to World War II. Just visit historyhit.com/subscribe.

• 0:32Speaker 01

  This is Steve Covino from Covino and Rich. Quick trivia, fellas. Every guy listening is a contestant. Answer honestly to yourself. You got a belly and a little chest? Gassed by the afternoon, no drive left in the tank? You lack that confidence and mental edge? Those are classic signs that your testosterone's been sliding. And nothing drags it down faster than extra weight. So why not take matters into your own hands? Strip off the weight that tanks your testosterone with Bioma GLP-1 Booster. Every serving is packed with science-backed ingredients that crank up your natural GLP-1 production. Visit bioma.health/GLP1 and use code CRSHOW for 15% off your first order.

• 1:12Speaker 02

  Hi folks, this is Mark Bittman from the podcast Food with Mark Bittman. And I'm here to suggest that you host Thanksgiving with industry-leading quality standards from Whole Foods Market. There are, as usual, no antibiotics ever in their meat department. So carve up turkey and spiral cut ham with peace of mind. Shop organic sides like stuffing mix and cranberry sauce from 365 brand. And guess what? All of their fabulous, delectable pies are made with no high fructose corn syrup. Where else are you going to find that? Gourmet Thanksgiving flavors with the quality you want, only at Whole Foods Market.

• 1:55Tristan Hughes?

  This episode is sponsored by Smart Travel, a new podcast from Nerd Wallet. Now, you know that one friend who always finds the best travel deals, picks the right cards and somehow ends up in first class for the price of coach? Smart Travel is like that friend, but in podcast form. They cover all the things travel finance, so you can stop stressing and actually start enjoying your trips. I'm lucky enough to travel a fair bit. You might have heard me talking about being on tour with the Ancients in Australia and New Zealand quite recently. Well, Smart Travel podcast from Nerd Wallet was a great help. They dig into which airport lounges are really worth it and which are just an airport gate with better snacks and worse lighting.

• 2:39Tristan Hughes?

  And what actually happens when an airline loses your luggage for 12 days? And how to get real money back instead of a free drink and an apology? Plus, the tip I really needed: how to book flights without it turning into a part-time job. Travel smarter and spend less with help from Nerd Wallet. Follow Smart Travel wherever you get your podcasts.

• 3:15Tristan Hughes?

  It's The Ancients on History Hit. I'm Tristan Hughes, your host. In today's episode, we are exploring the story of the earliest coins ever minted: the birth of money. It's a topic that takes us back over 2,500 years to what is today Western Turkey and the ancient kingdom of Lydia, home to the wealthy trading city of Sardis and famously rich kings such as Croesus, the man from whom we have the saying, "rich as Croesus." Now, our guest today is the TV producer, author and professor Alan O'Leary. Alan, he has recently written this extraordinary new book all about gold and how this precious resource has shaped human history.

• 3:58Tristan Hughes?

  Now, one key part of Alan's book, it explores the invention of money, of coinage, and how intertwined this story is with changing human attitudes towards gold. Alan, he is a wonderful storyteller. We cover everything from the earliest known use of gold over 6,000 years ago with the Varna culture in present-day Bulgaria, to the first financial crash in history.

• 4:22Tristan Hughes?

  Lots of great information about gold and early money coming your way. I hope you enjoy.

• 4:31Tristan Hughes?

  Alan, it is wonderful to have you on the podcast today.

• 4:34Speaker 03

  Well, it's wonderful to be here, it really is.

• 4:36Tristan Hughes?

  We're talking all about the birth of money today and the use of gold thousands of years ago, and the story of the first coinage, early money. Alan, this feels is closely entwined with this continual human fascination with gold, which has been there for over millennia.

• 4:53Speaker 03

  Yes, it has, and it's very extraordinary because gold is itself a very weird substance. The behaviour when people discovered gold is extremely weird as well. The first thing when they discovered the oldest gold known in the world, which turns out to have been in Bulgaria, on the shores of the Black Sea, at a holiday resort called Varna, probably wasn't a holiday resort in 4700 B.C., but it's quite a while back, that's part of the point. Troy seems, the story of the Trojan War seems a long time ago to us. Well, to people living through the Trojan War, this story is as far back again. We are talking about a very, very distant history, prehistory,

• 5:38Speaker 03

  when it was inconceivable that people were doing metalwork in 4700. And then this turns up, this cemetery, containing hundreds of graves, a fair number of which, over 60, have got gold in them, worked gold. And the graves are very strange and tell you something, but it requires quite a lot of interpretation to figure out what it's telling you. There's only one grave which has a human body with a substantial quantity of gold. A third of all the gold that's in this graveyard is on one body. And that one body is quite a tall man compared to the others. He had a gold headdress, he had a gold sceptre in his right hand,

• 6:22Speaker 03

  and he had a big gold disc. Now, this is where the story begins. And what you're looking at is the coronation regalia that was being used in Westminster Abbey last year.

• 6:33Tristan Hughes?

  So these are like 6,000-year-old kings who are using gold almost as part of their status?

• 6:38Speaker 03

  Nearly 7,000 years old. We don't know that the man was a king, except the stuff he's carrying is what we associate with a royal regalia.

• 6:49Speaker 03

  Why? Where does this idea come from? It comes out of nowhere. There isn't a predecessor to this. And this is where the story of gold actually begins. Now, that cemetery is really a culture we know nothing about. It disappeared from the face of the earth. Six of the graves contain not just no human being, but no human being and quite a lot of gold. Three of them contain scepters with no bones in there. Three of them, and they're associated also with weaponry. And the one that I call the Lord of Varna has got weaponry. And his weaponry is amazing. He has got a flint sword 35 centimetres long.

• 7:31Tristan Hughes?

  A flint sword?

• 7:33Speaker 03

  Flint, yes.

• 7:33Tristan Hughes?

  Wow.

• 7:34Speaker 03

  And it comes from Switzerland. I mean, this is a very, very long journey. He's got material from the Alps, the Italian Alps. So there are huge journeys being undertaken. There are very long connections with people very far away at this period when the rest of the Balkans is hunter gatherers. This is associated with a small group of the earliest agricultural settlements there.

• 8:04Tristan Hughes?

  Alan, it's really interesting. I mean, it might seem obvious to yourself, but to me, less so. But what you were talking about there, you know, with the Varna culture and these gold ornaments with these very high status figures. So it suggests, well, it shows that the earliest use of gold by humans, it's not they discover gold and they decide straight away to turn it into currency, to use it as currency. It's used for a very different purpose. First off, it's a status symbol to highlight these very important figures, do we think?

• 8:31Speaker 03

  Well, you say a status symbol. I think it's something different from that.

• 8:34Tristan Hughes?

  Okay.

• 8:35Speaker 03

  I think it's a direct connection with eternity. That is part of the status, of course. You have to be entitled. But the the thing that makes gold so strange is that it is incorruptible. So it doesn't belong in the mortal world. So you have people who've discovered this substance, which is unlike anything else in that it's absolutely malleable, absolutely ductile. You can change it in any way you like without altering it because you can put it back together again after you've finished working it and it turns back into what it was. You can bury it in the ground for lifetimes and when you dig it up again, it'll look exactly as it did when you buried it. There's nothing else like that on earth.

• 9:20Tristan Hughes?

  So can you imagine these people seeing it and thinking it almost is a supernatural material for supernatural beings?

• 9:27Speaker 03

  It is it is a material that is somehow in the changing world, but not of the changing world. So it has a connection, obviously, an obvious connection to the sun, to the heavens, to eternity. And so there is an association with something that we could interpret as divine power or the authority of the heavens is being granted by something here on earth to people, certain people.

• 9:57Tristan Hughes?

  So how long is it before gold changes in its meaning, at least in certain places of the world, in that it goes from meanings like as we've just mentioned there, to ultimately the first evidence of money emerging and gold being used as currency?

• 10:15Speaker 03

  Well, money is a very difficult concept because I would distinguish between money and being used for exchange. Money is something with defined value and it's being used for exchange long before it has a defined value. And the problem for them is people how to work out how to use it for exchange. But it acquires this exchange identity because of its connection to eternity.

• 10:44Speaker 03

  I mean, even in the modern world, people regard gold as something which contains intrinsic value, that if you have a piece of gold, somehow that is more secure as a store of value than anything else you could have. This is, of course, entirely potty. It's a psychological thing. It has no other kind of reality. But that's how we think. And I would also just quickly like to point out that a very similar burial to the Varna burial that I just mentioned turned up in northern Peru at a place called Sipan, dated about 300 AD, where there is a figure who's referred to now as the Lord of Sipan, who

• 11:25Speaker 03

  has a gold headdress, a gold rap scepter, and a big gold disc. Now, I don't think this is cultural transmission. I don't think anybody in the world remembered what had been done in Varna, and they certainly didn't get to Peru 5,000 years later and show everybody what a king looked like. These are ideas which formed independently. This is what gold inspired. I talked to people who work with gold, and they say that they have the feeling that gold talks to them and tells them what they can do with it. Very odd substance. You first see that happening, I think, in the second millennium B.C., where the first sign, I think, of what we're talking about is Hammurabi.

• 12:08Speaker 03

  King Hammurabi holds a ceremony. He has had soldiers coming from Mari, which is a town in Syria, a very special town. It's the first purpose-built town, which was built on a circular plan as a trading centre, crossroads, and also manufacturing centre, making bronze. And soldiers who come from Mari, he holds a palace reception for them, and it's well recorded. And at this palace reception, he gives out what he calls sun disks, golden disks, that are somehow connected to the sun, and they are given to the soldiers. You could see that as the first gold payment to mercenaries.

• 12:52Speaker 03

  I don't think they saw it quite that way, but it's kind of the origin. And one of the features of it is that these sun disks have got a specified value stated on them in shekels, and the value that's stated on them is wrong.

• 13:07Tristan Hughes?

  Oh, okay. So King of Babylon, the great King of Babylon, Hammurabi, he's messed up here with the values.

• 13:12Speaker 03

  He hasn't messed up. He's done it quite deliberately.

• 13:15Tristan Hughes?

  Oh.

• 13:15Speaker 03

  He has given them coins which are identified by him as a divine figure and king, as having a value beyond the value of the metal. So it's enhanced by its source, by the fact that it's been given by him. So it's a very peculiar kind of thing that's going on, but this is the start of a process that will become important.

• 13:40Tristan Hughes?

  And talk us through this process then, Alan, because I mean, you mentioned sun disks. I might think of early Bronze Age Ireland or Britain, where you have also this beautiful gold lunula. What are they called? They're necklaces kind of things, aren't they as well? Those gorgets, the torques as well, you see those emerging. So these gold objects are starting to emerge across the world. And then you have this kind of exchange of gold too. How does that process develop into ultimately changing into the birth of what we might call money?

• 14:08Speaker 03

  Well, you start with the idea that if you are engaged in long distance trade, you need to have some portable thing to be exchanged. We're not dealing with barter. Barter doesn't work for substantial trade. Firstly, what you may be trying to sell may be something which is perishable, and you're selling it in the summer. What you want to acquire is perhaps much later in the year and with a different quality. So you need something where the value is being stored by the person who's selling so that they can then later use it to acquire the other things, not barter. So you need some symbolic material. The material that gets used quite quickly is electrum.

• 14:53Speaker 03

  Electrum is gold that is found in riverbeds, which is alloyed naturally, mostly with silver, to some extent with copper and other materials. It's called, in the Sumerian period and the Egyptian period, it's called white gold, because there's so much silver in it that it's white. The Greeks call it electrum, which is actually the word for amber, which also gives you an indication of what the material is like. But it also tells you that electrum can vary in its content from one lump to the next. So you've got traders travelling with electrum because it has this quality of goldness, but it's not pure gold, but it's very useful to do deals with.

• 15:38Speaker 03

  And you get bars being produced by the late, about second millennium B.C., bars of electrum for trade, and these marked in divisions, and archaeologists refer to them as chocolate bars. You can break a bit off and do your deal with that bit. And these turn up, for example, at Troy. They're not come from Troy, and we don't know quite where they've come from, but they've, they travel around with the traders. And the traders are travelling long distances. Trade, there's a trade route that goes from Babylon to Troy. That's 2,000 kilometres. That's a heck of a walk. It's going to take months. So you want the material you're trading to be as compact as possible.

• 16:23Speaker 03

  And it's much easier to do a trade with a bar of electrum than with 15 such bars of silver, which is what you would need to get the sense of equivalence, or 200 sacks of wool or whatever. So the bar of electrum is a very handy, useful object. And the problem is that to do the trade, at the point where an exchange is being done, you've got to have an assessment of what this material actually contains. So there has got to be, at the trade centre, an expert who is trusted by everybody, who will assay the lumps of material and tell you what they're actually worth. And if you don't do the trade, you've got to go somewhere else and find another

• 17:07Speaker 03

  equally qualified, equally trusted dealer.

• 17:11Tristan Hughes?

  That must be one of the most highly sought after jobs at that time, for weighing the purity.

• 17:15Speaker 03

  Yes, they used a touchstone to do it. You know, a touchstone is a stone where you have sticks of different grades of gold, different levels of alloy, and you make a mark on the stone with it, and you compare it with the mark made by the lump that you're testing. And we still use that word touchstone to have that sense of jeopardy, something that it's a heightened moment testing the alloy, much easier to find a way around it. Now, at the crossroads on this trade route up towards Troy is the Kingdom of Lydia. The King of Lydia, his kingdom is rooted in Sardis. Sardis is a huge market center, a bazaar of a fabulous scale.

• 18:00Speaker 03

  The world comes through Sardis and the market in Sardis for travelers who have been traveling for two, three months before they get there is a great and exciting and thrilling place and a wonderful place to do deals. And the King comes up with this wonderful notion that he will offer the traders a deal. If they hand over the electrum they've brought, he'll get it assessed and he'll give them back tokens made of electrum to his own specifications and stamped with his personal badge. And these are the first coins.

• 18:50Speaker 04

  You know, you don't have to wait to shop Black Friday at Lowe's, right? Save up to $150 now on select power tools, equipment and accessories. Got gifts to get? We've got plenty under $50. Plus, MyLowe's Rewards members get same-day delivery for free. Shop Black Friday deals before the rush at Lowe's. Valid through 11/18, $25 minimum. Loyalty membership acquired. Order eligible items by 2 P.M. Subject to weight and size restrictions and availability. Terms at lowe's.com/shippingterms.

• 19:19Speaker 02

  Hi folks, this is Mark Bittman from the podcast Food with Mark Bittman. And I'm here to suggest that you host Thanksgiving with industry-leading quality standards from Whole Foods Market. There are, as usual, no antibiotics ever in their meat department, so carve up turkey and spiral cut ham with peace of mind. Shop organic sides like stuffing mix and cranberry sauce from 365 Brand. And guess what? All of their fabulous delectable pies are made with no high fructose corn syrup. Where else are you going to find that? Gourmet Thanksgiving flavors with the quality you want, only at Whole Foods Market.

• 20:00Speaker 05

  Hey, it's Hannah Berner from Giggly Squad and the holidays are around the corner, which means I'm officially entering my Hostess Hannah era with Arm & Hammer Hardball Cat Litter. You guys know I love cats and fostering, but when I'm hosting, I do not want my house smelling like cats. I want people focusing on my hosting skills. That's why I love Arm & Hammer Hardball Cat Litter. It delivers long-lasting odor control and forms compact clumps that make cleanup easy, so that's one less thing I need to worry about when people come over. Be guest-ready with Arm & Hammer Cat Litter. Find it now at Walmart or Amazon.

• 20:33Speaker 06

  The Quarter Pounder with Cheese is made with 100% fresh beef, cooked when you order it. Then comes the melted cheese, the slivered onions, the pickles, the ketchup, and the mustard. Add hot crispy fries and an iced cold Coke, all for $8. And if things go well, one loose fry at the bottom of the bag. The Quarter Pounder with Cheese meal, now $8. Ba-da-ba-ba-ba.

• 21:11Tristan Hughes?

  And when is this? I've got to my eyes, is this like the late 7th century B.C. we're talking now?

• 21:16Speaker 03

  Yes.

• 21:16Tristan Hughes?

  Kingdom of Lydia.

• 21:17Speaker 03

  Yeah.

• 21:18Tristan Hughes?

  And this is often regarded as one of the great, one of the great birthplaces of money, with these early tokens of this king, Alyattes?

• 21:26Speaker 03

  Alyattes, exactly. And the, you get an invention of currency going on in China, you get an invention of currency going on in India, probably roughly the same time. But it's not well documented and it's difficult to work out exactly what's happening. Whereas in Lydia, it's much easier. The source material is much better, the archaeology is also much better. And we know pretty much what Alyattes was doing, producing these. And it was hugely popular. And lots of other mints start up doing the same thing, because this is now business.

• 22:00Tristan Hughes?

  Is this mints across the Kingdom of Lydia, or is this stretching beyond the Kingdom of Lydia?

• 22:04Speaker 03

  Beyond, beyond. The Pigs also are doing it on the coast. And they're also being, not just necessary kingdoms, it's some individual businessmen seem to be minting, they're minting coins to sell to traders. So long as you trust the source and you trust the mark on it, then it's, it works. The Lydian stamp was a lion's head, and that was the identity of the, of the king was there on the coin. And everybody seemed to have been very happy with that for quite a while.

• 22:33Tristan Hughes?

  I mean, Alan, before we go on to the next part, I want to ask a bit more about that because I know you'll be going on to the next part otherwise.

• 22:38Speaker 03

  Yeah, sure.

• 22:39Tristan Hughes?

  The archaeology from Lydia at that time, you mentioned how it seems to be this great bizarre, this amazing marketplace. And surely then with the minting of these early coins, if they're made of electrum, archaeological record, do we have a rich record of these earliest coins surviving?

• 22:55Speaker 03

  We do have, oh yes. And well, there was a huge conference a couple of years ago, three years ago, on white gold, which is an enormous study of the archaeology of this material. Lydia, I should say, is a very odd place. It's odd because it's not part of Sumerian culture, it's not part of Greek culture, and its language, although it has a written language, is barely known at all. Herodotus writes quite a bit about Lydia and Sardis. To his astonishment, there is a huge monument to Alyattes there after he dies. And it is on the monument, the monument's been paid for by the citizens. It's not celebrating anything divine.

• 23:39Speaker 03

  And the Lydians themselves don't seem interested in the notion of a connection between gold and divinity. And they don't use it for religious purposes. They don't have golden shrines like so much of the rest of the world. They have a more commercial approach.

• 23:55Tristan Hughes?

  So with that, Alan, should you try and understand a bit more about the context as to this king creating this coinage? So it's based on having that significant commerce, that great trade route, so lots of gold and electrum coming in, access to gold. But is it also having to have that stable kingdom, that prosperous kingdom at the same time? So all those things combined, which allow for the creation of currency?

• 24:19Speaker 03

  You're absolutely right. He has a powerful army of horse archers, which again separates them from the other cultures around. And they are well trained and very effective. And they're there to protect the market and the merchants. They keep the whole thing in balance. This will become important. In that kingdom. So to Herodotus's astonishment, the majority of the donors to that great monument to Alyattes were women, who, Herodotus, being a Greek, assumes they're all prostitutes. But that tells you, you know, how different this is from Greek or Persian or Sumerian culture. Women are playing a formidable public role and are part of the

• 24:59Speaker 03

  commerce of the place. This all works very well. So the coins themselves contain forty percent gold, sixty percent silver. It's and but the value is not the metal, the value is the stamp.

• 25:15Tristan Hughes?

  Oh, okay.

• 25:16Speaker 03

  That's what tells you you can trust this. And you don't have to see what the coin is made of. And in fact, they're gilded to stop them being tested by touchstones. So you can't actually find out what's in the coin unless you destroy it. And this is a good working system until the balance of value of the two metals moves apart completely.

• 25:38Tristan Hughes?

  And so what is the cause of this?

• 25:40Speaker 03

  Now, what has happened, and this has been unclear up to now, what had happened was that the amount of gold available for the market had changed dramatically. And nobody's really looked at this connection before. But what had happened, the big thing that had happened, was the destruction of Jerusalem.

• 26:03Tristan Hughes?

  So early, early sixth century B.C., Nebuchadnezzar the first, king of Babylon, sacking Jerusalem.

• 26:08Speaker 03

  Nebuchadnezzar, king of Babylon, becomes king in six oh five, and in five eight seven, seizes the temple of Jerusalem. But it's not a quick and easy process, and it's a very extraordinary one. What's happened is that when Assyria was great, Assyria attacked the northern kingdom of Israel. Israel was split into two parts. The northern kingdom was attacked by Assyria. Its inhabitants fled south, a lot went to Jerusalem, carrying their treasure and carrying all the religious goods, tons of stuff, which all goes into the temple in Jerusalem, which is already a great golden shrine. And the Bible is very clear about the massive quantities of gold in there. And this is part of the general culture of the area in

• 26:52Speaker 03

  which the gods are associated very much with gold. And a space that is created for them of gold allows a special human being who is divinely connected to be in there with the gods. The word, after all, in the languages of the time, and in modern Hebrew for a temple, is actually the word house. This is the house of a god, and that's why it is spray painted to an incredible scale with gold. It just is like an explosion in a gold factory going into Solomon's temple. Then there is more come down from the north. Assyria, obviously,

• 27:33Speaker 03

  Sinakarib decides to, he's got to go on, grab Jerusalem as well, but he can't do it. It's a very well defended place. And that collapses. Then Nebuchadnezzar comes to power after the defeat of Assyria, and he has a great building program. He wants to rebuild Babylon. To do this, he's going to need a lot of money. And the reason he's going to need a lot of money is because Babylon has no access to the natural resources needed to rebuild it. It's got no timber, it's got no stone, and it's got no metal. What it's got is agriculture, very prosperous and successful agriculture. And he's going to have to monetize this, but he's got to get hold of more gold from somewhere, so that he can buy the enormous

• 28:16Speaker 03

  quantities of stuff he wants to rebuild Babylon. Where can he get this gold from? During the defense of Jerusalem, the king of Jerusalem had invited Babylonian delegation to come and have a look at the temple, presumably because he wanted to show them that he could afford to finance a rebellion by them against Assyria. It didn't go anywhere. But the prophet Isaiah was very annoyed about this having been done, because one day you're going to get into serious trouble here. You should never have shown them all that. And it means that Nebuchadnezzar now knows where he can go to get the gold. And this is the only possible explanation of his campaign against Jerusalem, I think. Because Jerusalem is not on a trade route, it's not on a military road.

• 29:00Speaker 03

  The two big roads, one called the sea route, which goes up along the coast. The other called the King's Road, which goes up the Jordan Valley. They both avoid Jerusalem.

• 29:12Tristan Hughes?

  It's not like a Damascus or Tyre or Gaza, is it? In that significance?

• 29:16Speaker 03

  No, it's not. It is not got that sort of... Why would you bother attacking it on a large scale? Nebuchadnezzar makes his first attack, he gets bought off, basically. He goes away with a certain amount of gold, and what he does is interesting. And the Bible is very clear about this. He takes the gold vessels and he cuts them up. He's not treating them as sacred booty. He's having them converted into money. They are for sale. That's why he chops them up. There's no other reason why you would do that. He's not going to use them, he's not going to show them off. No, he's handing them out to the merchants. And clearly the merchants say it's not enough. So he goes back a year later. And he's got to get it, and he knows there's a lot there. And he can't get at it. So, this is a siege that goes on.

• 30:01Speaker 03

  It looks like thirty months. Thirty months of a great empire using its massive army to besiege a place which is of no military significance. And when it finally succeeds, it doesn't just conquer it. It totally destroys it, it takes it apart stone by stone. Where have they hidden the gold? And Jerusalem doesn't exist at the end of this. And he's taken out a hell of a lot of gold. And we know what the effect of that is. Because we have these wonderful tables of prices. This extraordinary set of cuneiform tablets stored in the British Museum, which the temple records every month the prices of six commodities

• 30:43Speaker 03

  for centuries, including the period we're talking about. I think these are probably the finest financial records in existence, better than our records of our own economy, better than America's records of its economy. We have hundreds of years of price data of the same things measured in the same currency. And each one of those monthly records includes the positions of the planets, which is why these are called the astronomical diaries. We can therefore date all the prices.

• 31:15Tristan Hughes?

  So what does this amazing resource provide us, Alan, or provide you for learning more about how all of this gold taken from the Temple of Jerusalem, how it invigorates the Babylonian economy, affects the merchants, are they making electron coinage from it? What is the effect of this great influx of gold that has come to the Babylonian kingdom?

• 31:36Speaker 03

  The effect of this influx of gold is not what the Mekanids are intended. It's exactly the same thing, we see it happening later on with the Spanish in America. The Spanish think if they take all the gold out of America, they'll be rich. No, what will happen is they'll take all the gold out of America and the gold will fall in value because there's too much of it. And that's what happened to Babylon. The gold falls in value. It's a slower process than we're used to in the modern world because distances are greater, communications are slower. But from the time that the temple is seized, the value of gold falls steadily. This is because prices are in silver and gold and silver are in a ratio to each other.

• 32:19Speaker 03

  So the increase in the quantity of gold reduces the value of gold, so the gold-silver ratio changes. And so gold, then, you have to regard it as a commodity, like barley, like anything else, and its value falls in relation to silver. And you see that in the price changes in these tables, which don't measure gold price, but they do give you silver prices for the commodities. And you can see this huge shift in commodities. And it's interesting, the person who published this incredible scholarly work, publishing all the information from these tables of the late 1990s, says, "There's this fall in prices and we don't know why."

• 32:59Tristan Hughes?

  It's almost, I mean, sorry, Alan, to bring in kind of a modern analogy here, but if you have like shockwaves from this going across the known world, all the way to like Turkey and Lydia and places like that from Babylon, is this almost like the first financial crash in history?

• 33:12Speaker 03

  Yes. Wow. Yes. Well, it must be the first because it's the first time there'd been currency anyway to crash.

• 33:18Tristan Hughes?

  Yes.

• 33:19Speaker 03

  And a friend of mine called Paul Craddock. Who is the metallurgist who was working for the, as an archaeologist with the British Museum, excavated in Sardis, and he thought he'd found a mint that was producing the coins. And then he realized as the excavation went on, this wasn't a mint. What they were doing in this place was taking the coins to pieces. They were destroying the currency. And he found the whole of the methodology by which they did this, by which they take electron coins, turn them to foil, and then disintegrate them in order to separate the gold from the silver. Because it had got to a point where the face value of the coin was less than the value of the silver.

• 34:44Speaker 02

  Hi folks, this is Mark Bittman from the podcast Food with Mark Bittman, and I'm here to suggest that you host Thanksgiving with industry-leading quality standards from Whole Foods Market. There are, as usual, no antibiotics ever in their meat department, so carve up turkey and spiral cut ham with peace of mind. Shop organic sides like stuffing mix and cranberry sauce from 365 brand. And guess what? All of their fabulous delectable pies are made with no high fructose corn syrup. Where else are you going to find that? Gourmet Thanksgiving flavors with the quality you want, only at Whole Foods Market.

• 35:35Tristan Hughes?

  It's amazing how the actions of that Babylonian king affects the monetary system that is happening, you know, hundreds, if not thousands of miles to the west in western, what is Turkey, Anatolia today, in Lydia, in Sardis.

• 35:47Speaker 03

  Yeah, but this is where the traders are going.

• 35:49Tristan Hughes?

  That is where the traders, of course.

• 35:50Speaker 03

  The trade routes are 3,000 kilometres long. This is what binds this world together. There is a direct trade route that goes from Babylon to the Greeks in the Mediterranean. That's why I was stressing how long distances things have travelled, even to Varna thousands of years before. People move enormous distances. Objects move enormous distances. If they're wanted, they'll get them. And so that's what was happening. The impact of value, I mean, it travels slowly. It's a ripple, but it happens. And you can see it happening and you can see the value of gold commodities halving. It's overproduction of gold creating inflation.

• 36:33Tristan Hughes?

  And so how does this affect what happens next?

• 36:36Speaker 03

  Well, what happens is obviously if they're destroying the currency, the whole trade route is, there's a word that starts with F, I can't remember what it is. It's in a poor way. So by the time Alyattes dies, his whole currency has perished. His successor is a chap called Chrysus, who most people will have heard of. Rich as.

• 36:57Tristan Hughes?

  Rich as Chrysus.

• 36:58Speaker 03

  Rich as Chrysus. Now, one of the reasons that Chrysus is rich as Chrysus, as Alyattes was also very rich, the river that goes through Sardis, unlike any other, the gold that's found in that river is 100% pure gold. It's 24 karat.

• 37:11Tristan Hughes?

  Wow.

• 37:12Speaker 03

  It is not alloyed with anything. So you've actually got a source of real good gold there. And so Chrysus comes up with this marvellous idea. In will produce a new coinage made of one hundred percent pure gold. And alongside it, a parallel coin of silver. And these two coins will replace the old one that was a the two metals joined together. And that will mean that shifts between the value of one and the other can be coped with. And and it's coped with very simply, actually, because when the when the value relative value changes, he actually changes the relative sizes of the coins. And he's now introduced currency stability.

• 37:53Speaker 03

  And you now have really very significantly the introduction of the gold standard and a gold coin, which we still use. The one third stater that Chrysus introduced is the same size and weight, not quite exactly, but almost exactly, as the sovereigns they're minted, the gold sovereigns they're minting in London now. But instead, the the symbols that he put on that coin were the lion facing down a bull. And the two of them are glaring at each other head on. Now, the one change that we've made is that we now have the lion and the unicorn, one horn instead of two. But it's actually, you know, it's a gold, it's the gold currency.

• 38:36Speaker 03

  And this has been the basis of the world's economy ever since, with catastrophic consequences.

• 38:44Tristan Hughes?

  So at that time, when Chrysus introduces these reforms of fully gold, fully silver, to avoid that issue of election coins before, is it now that the amount of gold in a coin doesn't directly determine the value of it? As you say, it's a fixed rate.

• 39:01Speaker 03

  Oh, it does, it does. The amount of coin in amount of gold in the coin now is the value of the coin.

• 39:06Tristan Hughes?

  Okay.

• 39:07Speaker 03

  That's why this is a disaster.

• 39:09Tristan Hughes?

  Oh.

• 39:10Speaker 03

  Because what's happened is that what he's done is to convert money into absolutely a commodity. If you buy Chrysus's gold coin, you're not actually depending on the the stamp to validate it. What you're depending on is the certainty that it's pure gold, easily checked, and its weight. That is the value of the coin. And that is why it leads to catastrophe. Because once your money is itself, the pieces of money are themselves worth something. That's one big problem. And the second big problem is it's not just that they're worth something. But they have a connection to a religious connection,

• 39:52Speaker 03

  which has a drastic effect on what happens to them. After all, if you think about it, the price of gold is going up all the time. It seems to be steadily on the increase. Now, the amount of gold in the world can never go down. One of the features of gold is it's absolutely indestructible, except by very peculiar activity. So the amount of gold will constantly increase. The gold that was in the Roman Empire, the gold that was in the Babylonian Empire is all still with us and probably is in bits of gold that we buy in jewellery shops now. There's no way of knowing. But its religious significance means that there are other cultures

• 40:34Speaker 03

  which are much less interested in its monetary value than in its religious value. And so they will keep taking it out of circulation to offer it to the gods. For example, the mercenaries who are being paid with gold coins are not going to use that to go and buy a loaf of bread with. For a start, the gold coin is much too valuable, but also it has a totally different significance for them. So what used to be regarded as gold hoards buried in the ground for safekeeping in times of trouble, now most of them turn out to be not that at all. What they are is offerings placed in the ground for security, safety, protection.

• 41:15Speaker 03

  So you have towns in Britain which have gold coins placed in the ground at the entrance to the town as a guarantee of divine protection. You have enormous quantities of gold being used to celebrate divinity in India, in China. Look at those huge Buddhas, tonnes and tonnes of gold. Temples in India with billions of pounds' worth of gold in their vaults belonging to Krishna. Gold is being taken out of circulation all the time. Now, the thing about currency is that it has a function. Its function is to make trade possible. The Chinese worked out a long time ago, about the time that all this was happening,

• 41:58Speaker 03

  that currency is best regarded as not having value in itself, and it's better if you use tokens that don't have significant value. If you give them significant value, you run into trouble because you have to have enough of these tokens to make gold flow in a fluid way. If you produce too many, then you have inflation. If you produce too few, you have deflation. You've got to get the balance right. Now, the problem with the fact that gold is constantly being taken out, taken out, taken out, disappearing, always to the east, by the way, always to China and India, is that you run out of gold. You keep running out of gold. And this causes one continual crisis after another, right through into modern times.

• 42:40Tristan Hughes?

  Right through into, so this isn't just with Creuses, and this isn't tied to the fall of Creuses. This is something that just goes on and on and on. And yet, at the same time, you are seeing, I mean, how long is it before, I mean, Creuses' monetary reforms, can we say, that do start spreading across, let's say, the ancient Mediterranean, Egypt, Near East and further?

• 43:02Speaker 03

  It's erratic. It's erratic because, for example, Persia doesn't have a market. So when Persia destroys Babylon, it changes the whole significance of currency. Circulation of gold currency diminishes greatly, and it becomes much more of a medal, a prize, a gift. But then it comes back again as other cultures see it as a way of paying mercenaries particularly. So it is, it's not a continual story. It's one which is constantly being repeated and rediscovered. And from time to time, it looks as though gold is disappearing as a currency system. This happens not only in the ancient world, when you have a period when the Greeks think

• 43:46Speaker 03

  that gold currency is an evil and it's the currency of tyrants and the currency you want is silver. So you go through a period like that, which is changed by Macedonia, which is very keen on gold currency, right up to when Rome falls, it falls because it runs out of gold, can't pay its armies anymore, the gold is all gone. And you go into a Europe which develops a new kind of methodology of how you pay people and how you pay your soldiers, which we call feudalism. And they don't have any gold. And there's probably one bathtub of gold available to the whole of Europe in the 11th, 12th centuries. But then it comes back again through the Arab world. And you get these crises coming back

• 44:30Speaker 03

  and back and back. I mean, in the 19th century, where after the California gold rush, it was widely believed among Europeans that the California source of gold was endless. So when Germany decided to switch from having a silver currency to a gold one, the Germans were quite untroubled by the fact there might not be any gold for them to use for money. But they were wrong about California, and there wasn't any gold for them to use as money. And the result was an enormous financial crisis devastating in the 1870s. So this is a problem that keeps on coming back. Gold has been the worst thing you can imagine as a currency.

• 45:07Tristan Hughes?

  And to think that it all began with Alyattes and his golden silver coins, and then of course Croesus with his gold as well. I mean, Alan, this has been a fantastic chat. I must admit, the last thing I want to say before we wrap up, Gintardi, is it's so interesting how the birth of money as a currency, it's such a, it's that shift in the human psyche back then of shifting gold, not just from the religious sphere, but into like the secular, the trading, the commerce sphere as well. It's a massive moment and an attempt almost to change that ideology, those beliefs.

• 45:42Speaker 03

  It is, absolutely. And you see the extraordinariness of it in America. When the Spanish arrive in America, they arrive in a highly sophisticated World of large cities which don't have money, they don't use money at all. And a large part of the colonial enterprise of the Spanish is to drive the indigenous people of South America particularly into having to use money because this is the only way that Spain can get a taxation system that allows them to withdraw money. They're after the gold, the only way they're going to get it if they can force people to trade using gold and take some of it as tax.

• 46:23Speaker 03

  But Spain has entered a world where the idea of currency is unknown, where large cities survive without having markets of the kind that Eurasia had, but still survive perfectly well with a different system of exchange completely. And gold having an enormous sacred purpose, very important, very much related to life, energy, rebirth and safety, but not money.

• 46:52Tristan Hughes?

  Alan, this has been an absolutely fantastic chat. And as hinted at there, you could talk about so much more than just the birth of money in ancient history. You can talk all the way down to the 19th and 20th centuries, indeed to gold and its use in the present day, which leads me to ask you about your book. It is called.

• 47:10Speaker 03

  It is called Gold, How It Shaped History. And it's come out at the very moment when a large number of countries are accelerating their possession of gold to an extraordinary and unprecedented extent. And it's not reported, but Russia has massively increased its acquisition of gold. So have countries in Eastern Europe like Poland, as well as India and China. And this is because of something that they think it's making them safer in the face of something coming down the road that they're expecting. And we don't even talk about it.

• 47:46Tristan Hughes?

  We don't indeed. Well, poignant point to leave on Alan, but it just goes to me to say thank you so much for taking the time to come on the podcast today.

• 47:54Speaker 03

  Why wouldn't I? Thank you. It's lovely to have the opportunity, really is.

• 48:02Tristan Hughes?

  Well, there you go. There was Alan Arera talking through the story of the birth of money, the origins of coinage, and how this story, it is closely intertwined with gold and changing human attitudes towards gold throughout ancient history. I hope you enjoyed today's episode. Please follow this show on Spotify or wherever you get your podcasts. It really helps us and you'll be doing us a big favour. Don't forget, you can also listen to us and all of History Hits podcasts ad-free and watch hundreds of TV documentaries when you subscribe at historyhit.com/subscribe. That's enough from me, and I'll see you in the next episode.

• 48:56Speaker 04

  Whoever said good things come to those who wait? Never shopped Black Friday early at Lowe's. Right now, get up to 50% off select major appliances. Plus, get free delivery, free haulaway, and free basic installation and parts when you spend $896 or more on select major appliances. Shop Black Friday early in-store and online now at Lowe's. Valid through 12/2 while supplies last. Selection varies by location. See associate at lowe's.com for details.