Why? Econ 101. Commerce comes to a grinding halt if I'm trying to pay you with chickens and you only accept widgets, and you need to pay somebody with gold. It doesn't work.
It's amazing that the human race managed to conduct commerce for thousands of years before the Fed came about.
Have you ever wondered why it took such a long time for modern civilization to evolve, and why civilization basically exploded after the 18th century?
Centralized money, banks and easier access to credit was an important factor: money could be pooled and risk takers did not have to convince someone face to face to take up that risk personally - a pooled entity (banks, big investors) could serve that role more productively.
Before that, during the static gold standard, the lack of liquidity was stifling innovation big time, for thousands of years. Only the super-rich could afford large-scale risk-taking, and their number was low and highly concentrated. More money, more pooling of money and better (and faster) distribution of money activated incredible reserves of the human race.