From our perspective, though, what it reveals is just how closely bound together war, bullion, and these new credit instruments were. One need only consider the paths not traveled. For instance, there was no intrinsic reason why a bill of exchange couldn’t be endorsed over to a third party, then become generally transferable—thus, in effect, turning it into a form of paper money. This is how paper money first emerged in China. In medieval Europe, there were periodic movements in that direction, but for a variety of reasons, they did not go far.74
Important note!
