Marco Polo documents Yuan paper money
Marco Polo spent 24 years in Kublai Khan's Yuan China. He returned to Europe with detailed descriptions of a paper currency that his European contemporaries found almost unbelievable. The concept of state-backed paper money took another three centuries to take root in Europe, not because Europeans could not understand it, but because no European state was strong or centralized enough to make such a currency credible.
Polo's accounts of Chinese paper money were dismissed with the same skepticism as his descriptions of cities with millions of inhabitants. Both turned out to be accurate. The gap in monetary technology between Yuan China and medieval Europe was wider than most Europeans wanted to acknowledge at the time.
03 · Paper Money
Paper money is a piece of paper that says, on its face, that it can be exchanged for something else. That something else — usually metal — stays in a vault. The paper circulates, the metal doesn't. The entire economy becomes a bet on whether the issuer can still deliver the metal. For most of paper's history, they couldn't.
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