In the course of time it appeared that among the numerous articles exchanged, there was one which nearly everybody wanted - shells, furs, grain, tobacco, or metals. Gradually men recognized that this commodity was the best thing to accept in exchange for what they had to sell, for it could be exchanged later on for other products or services. In the case of our Indian tribes, for example, shell beads were admired and prized by all. It is easy to understand how some members of the tribe might devote most of their time to hunting for the shells and making them into strings of beads which were in universal demand for personal adornment. A part of their stock of beads would be exchanged for food and other needs. A man who had a surplus of food would gladly exchange it for beads even though he had no particular desire for more beads. He would be better off with a surplus of beads than with a surplus of perishable food, for beads were always in demand. Thus, by unconscious selection, certain commodities came to be recognized as best fitted to serve the purpose of a go-between in making exchanges. In some such way the use of money began.

Exchange, then, may assume either of two forms: direct exchange, called barter, where commodities or services are directly exchanged one for the other; and indirect exchange by means of some article of general acceptability and convenient subdivision called money. Money is a commodity, to be sure, but when it is exchanged for other commodities or services the process is not called barter. We term this process buying and selling. It is an exchange of goods for goods by the use of an intermediary. Thus, money represents an incomplete or suspended exchange. We willingly accept money for goods, not because the money itself gives us pleasure, but because we know we can exchange it in turn for the various things that will satisfy our wants.