0:01 welcome to our video series about the
0:04 origins of money by Carl Manger in this
0:07 video we describe chapter 3 about the
0:09 problem that led to money as a medium of
0:13 exchange in early trade people were slow
0:16 to realize the advantages of exchanging
0:18 goods in the beginning their goals were
0:20 simple they mainly focused on getting
0:23 what they immediately needed this meant
0:25 that when they traded they were only
0:27 interested in acquiring goods they could
0:29 directly use if someone offered them
0:32 something they didn't need or already
0:34 had enough of they would simply reject
0:37 it because of this the opportunities for
0:40 trade were very limited think about how
0:42 rare it is that two people each have
0:44 something the other values less than
0:47 what they would get in return and how
0:49 much rarer it is that those two people
0:51 would actually meet and agree to trade
0:54 the situation becomes even more
0:56 complicated when one person wants to
0:58 trade an item that isn't easy to divide
1:00 or when the trade involves multiple
1:02 goods owned by different people for
1:05 example suppose person A wants something
1:08 from person B person B wants something
1:10 from person C and person C wants
1:12 something from person A under a simple
1:15 barter system this type of trade would
1:18 almost never happen because all three
1:19 parties would have to agree at the same
1:21 time
1:23 these difficulties would have made trade
1:25 nearly impossible especially for goods
1:27 that didn't have regular demand without
1:29 a solution economic activity would have
1:32 remained very limited and the production
1:34 of goods that weren't guaranteed to sell
1:36 would have been discouraged the solution
1:38 to this problem however emerged
1:40 naturally from the fact that some goods
1:42 are easier to sell than others this
1:45 difference in how easily goods can be
1:47 traded is extremely important for
1:49 understanding both how money developed
1:51 and how markets work in general
1:53 economists have long overlooked this key
1:56 point when trying to explain trade and
1:59 money which has left a serious gap in
2:01 the understanding of how money works a
2:03 proper theory of money has to start with
2:05 an understanding of why some goods are
2:07 more salailable or easier to sell than
2:09 others once we understand why some goods
2:11 are easier to trade we can see that
2:13 money's near universal salailability is
2:15 just a more extreme version of a general
2:18 pattern in economic life the fact that
2:21 some commodities are naturally more
2:22 marketable than
2:25 others do you like this video please
2:28 like subscribe and share and go to the
2:29 next video about chapter 4 if you want
2:32 to read the book get it in the
2:33 description below
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