Will the real magic money tree please stand up?

July 10, 2017 Share Source

Pssst... come here. We want to tell you the secrets of the magic money tree. No, not that one. Did you know that money did grow on trees, once upon a time? Technically, they still exist. We're talking about the quiet willow tree, solemnly guarding the banks of the English Thames. A mere 800 years ago, English consumers used branches from the grand willow as currency. #creativitree

These willow tree sticks, known as tally sticks or Exchequer tallies, allowed people to track debts in a 'sublimely simple and effective' way. Assigning a communally agreed value to small tradable objects is an impulse that we've seen across the globe and throughout history, suggesting that cash-equivalents are universally inspired.

Excerpt: Foils and stocks

'The stick would contain a record of the debt, for example: "£9 4s 4d from Fulk Basset for the farm of Wycombe". Fulk Basset was a Bishop of London in the 13th Century. He owed his debt to King Henry III. [...]'

'The stick would be split in half, down its length from one end to the other. The debtor would retain half, called the "foil". The creditor would retain the other half, called the "stock" - even today, British bankers use the word "stocks" to refer to debts of the British government.

'Because willow has a natural and distinctive grain, the two halves would match only each other.

'Of course, the Treasury could simply have kept a record of these transactions in a ledger somewhere. But the tally stick system enabled something radical to occur.

'If you had a tally stock showing that Bishop Basset owed you £5, then unless you worried that he wasn't good for the money, the tally stock itself was worth close to £5 in its own right.

'If you wanted to buy something, you might well find that the seller would be pleased to accept the tally stock as a safe and convenient form of payment...'

Read full article here

Source:

Harford, Tim. "What tally sticks tell us about how money works." BBC News. July 10, 2017. Accessed July 10, 2017. Web.

Tim Harford is a columnist for the Financial Times's Undercover Economist and presenter of the BBC's 50 Things that Made the Modern Economy.

Last Updated: Aug. 2, 2017