ABSTRACT
Barter entails complete settlement of exchange, so credit and money have coexisted since at least the Babylonian period. The origin of money interest is due to the functional role of money given by legal and institutional settings that defies the entropy law. Money creation through the banking system originates from Roman Republic as Mutuum. A successful credit system of Scotland in 18th century, termed cash credit, is presented. Democratically elected representatives of a nation state should have full power to control money creation and tax imposition. The influence of money creation on price and interest levels are also discussed.
