ABSTRACT
The chapter covers controversies in money, origins of money: money as a commodity and a unit of account, money is gold and silver, nature of government inconvertible paper, the debate Locke versus Lowndes, theories of optimum money and sharia money. Sharia considers money and financial intermediation as two related aspects of the payment mechanism in an economy or across economies. Monetary organization was similar across nations: it consisted of adopting a monetary law defining the unit of account, the standard of value in weight and fineness, and types of coins in terms of weights and shapes to be allowed to circulate. To circulate as money, gold and silver had to be coined in a standard shape. Government inconvertible money arose from bankruptcy. A government with balanced budgets would never need it. Imposed by force, inconvertible paper is a taxation means, highly inflationary, and causes impoverishment.
