Money is personally important and important to the nation. Banks create money and the Fed determines the extent to create and destroy money, though most is done by banks. Banks create credit money in cooperation with bank deposits.
The US dollar is called fiat money, which is money because the government says so. Fiat money isn't attached to a scarce resource like gold. When fiat money is unstable, it is because the government is unstable.
Bartering involves a coincidence of wants; it is a form of commodity money. "Parfadism" is related as part of ancient agricultures.
Seigniorage is the profit the government makes from coining money. It may only cost 4 cents in materials and labor to create a coin worth 25 cents in the marketplace (a quarter). In 2004, the cost of producing US coins was as follows:
| Golden Dollar | Half Dollar | Quarter | Dime | Nickel | Penny |
|---|---|---|---|---|---|
| 21.14 cents | 16.97 cents | 7.33 cents | 3.14 cents | 4.56 cents | .93 cents |