152 BUREAU OF AMERICAN ETHNOLOGY [BuU. 188 



each with its mercantile house, developed at Flagstaff, also on the 

 Santa Fe, and at Farmington, terminus of the D & EGW narrow 

 gage line originating in Alamosa, Colo. 



In 1876 five trading posts were reported to be operating in and 

 around the Navaho Keservations (Sanders et al., 1953, p. 232). By 

 1890 there were nearly 40 (Underhill, 1956, p. 182), and the number 

 increased steadily until about 1930. At the present time the number of 

 stores on and around the reservation, and devoted chiefly to Navaho 

 trade, is in the neighborhood of 200 (cf. Kluckhohn and Leighton, 

 1946, p. 38). 



Many of the first Navaho trading posts were more or less transient 

 enterprises, changing ownership and location frequently in response 

 to the unstable and undeveloped frontier market. Few of them could 

 boast any installation more permanent than a tent for many years. 

 Frontier trading involved considerable capital risks, but in return 

 offered big, quick profits from a largely untapped consumer market. 



In the beginning on-the-spot barter was necessarily the only basis 

 of exchange, as no cash was in circulation and unstable population 

 conditions did not premit credit transactions. Where large com- 

 modity exchanges were involved written "due bills" were issued to 

 the Navaho consumer, which might be traded out at any time in suc- 

 ceeding months. Navahos soon learned to counterfeit these (see Van 

 Valkenburgh and McPhee, 1938, p. 45), and a type of trade money or 

 scrip was substituted (cf . Van Valkenburgh and McPhee, 1938, p. 45 ; 

 Underhill, 1956, p. 183). This historic practice continues to be com- 

 memorated in the bewilderingly complex Navaho system of counting 

 money, according to which all amounts under one dollar are expressed 

 as sums of "blues" (10 cents) plus "yellows" (5 cents) plus "reds" 

 (1 cent), regardless of the actual coins involved. (The change- 

 reckoning system is further complicated by surviving vestiges of a 

 still older Spanish system : 25 cents, 50 cents and 75 cents are expressed 

 not as sums of "blues" and "yellows," but as two, four and six reales 

 respectively. Likewise 15 cents for some reason remains simply 

 quince. For a complete analysis of the system, a thorough control of 

 which is essential to all traders, see Mitchell, n.d., pp. 17-18) . Use of 

 trade money has long been outlawed, but it can still be seen at a few 

 of the more isolated stores on the Navaho Reservation. 



Wool and blankets were the two commodities which formed the 

 basis of the early Navaho trade, with hides and pelts a distant third. 

 Although blankets had been the chief item of pre-reservation expedi- 

 tionary trade, it was the addition of enormous quantities of raw wool, 

 most of which had previously gone to waste, which made commerce 

 lucrative in the early reservation period. In 1886 Navaho traders 

 bought a million pounds of it; 4 years later the yield had doubled 

 (Underhill, 1956, p. 181). 



