Sumerian Loans

           Loan contracts date as far back as the 3rd millennium BC and the oldest we know of today come from the same part of the world that gave us the first systems of writing. Examining these records reveals that lending was common even in ancient civilizations, and more surprisingly still, that even in a mostly

Tally Sticks

           How do you verify a debt or payment in a mostly illiterate society? What records can you rely on? Trade and credit in the medieval world required some way of tracking amounts due and paid without the aid of written records. In medieval England, wood sticks were used to represent debts and by a simple

Investors Overseas Services

           Around 1970, a Switzerland-based asset management firm, Investors Overseas Services, had grown into one of the largest in the world in the span of just a few years, this despite a small initial target market of American soldiers deployed in Europe. Of course, the company had grown far beyond this limited market in the years

Merrill Lynch & Company

           Over the course of the 20th century, courtesy of improvements in communication, and some deregulation along the way, owning shares in listed companies was transformed from a privilege of the wealthy and connected few to something almost as common as a bank account or insurance policy. Yet, in the decade after the stock market crash

Wimbledon and Finance

           London was the premier financial center in the world in the 19th and early 20th century. This status seemed lost for sure when New York and Tokyo gained share at different points of the 20th century. Indeed, forty or fifty years ago, the prospect of London regaining its past preeminence seemed a remote possibility, if

Finance and Medieval Fairs

             Before the advent of the first specialized trading cities like Bruges, Antwerp, and Amsterdam, trade in Europe relied on a system of fairs that followed the same circuit each year. In the Middle Ages, these fairs brought together merchants from much of Europe. Conducting trade over such long distances at larger scale increased the demands

Mobilizing Credit during WWII

           The Second World War not only pulled American economic output closer to its potential capacity, but also transformed its composition. War-related industries were prioritized and the production and consumption of other goods was controlled by rationing. This is fairly well known. What is less well known are the ways credit was mobilized during the war,

William Durant

           In the early days of any industry, growth requires lots of external capital. Reinvested profits, if there are any profits at all, are usually woefully insufficient to meet the growth expected by visionary founders or eager customers alike. This means the founders and executives of firms in new industries have to be capable financiers, or

Insurance and the Titanic

           The Titanic tested the insurance industry. Ships of its luxury and scale were novel, bringing into question the correct pricing for insurance coverage on such a ship. In the end, it seemed that underwriters underpriced the risk, since when the Titanic’s sister ship Olympic secured coverage for its next transatlantic crossing after Titanic’s sinking, the

Japan’s 1980s Property Boom

           Financial bubbles become so large because they have the potential to self-perpetuate. When expectations for future prices are based on a recent trend, the best performing investments in the near future will usually be the same as those which have performed well thus far. If encouraged by greater publicity, credit availability, loose regulation, or an

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