The financial system of classical Rome was developed enough that it had long abandoned a barter economy by the time of Caesar or Augustus. Rather, it had an efficient monetary system. This is not to say that it was an economy where people only, or even mostly, transacted in coins. Indeed, credit was also important.…
For a small country, Switzerland punches above its weight in banking. This has largely been attributed to bank secrecy rules that make Swiss banks particularly useful to some. Over the past century, the country’s banking sector has been associated with secrecy, accused of facilitating tax evasion and other crimes. While a professional standard in banking…
While credit may hardly be considered unavailable to the poor in wealthy countries today, it’s easy to think it only became so accessible in recent times. In truth, though there will generally be more eager lenders to the rich than to the poor, and while the forms of credit available to the latter have changed,…
Over the last half century, regulation of banks has generally diminished as governments have shed the controls implemented during the Great Depression. In the United States, as elsewhere, banking used to be a very staid business with its workings dictated more often by regulation than by competitive dynamics. Indeed, for decades, the interest rates paid…
While they had existed for centuries before, it was during the 19th century that access to banks was extended to virtually all classes. In Europe and America, new types of banks were formed, including credit unions, that sought to provide dependable financial services to ordinary people. The first of these credit unions were formed in…
Whether usury laws stunted the growth of finance, especially in early modern Europe, is a question that causes much disagreement. The degree of enforcement of these laws may have had some impact on the level of financial development in different parts of Europe but it would be difficult to argue that usury laws stifled all…
Many understand that banking activity was stifled in Europe during the Late Middle Ages by religious prohibitions on usury, which then referred to lending at any interest rate at all. However, this view is somewhat anachronistic, at least when applied to the end of the Middle Ages. By the time history arrived at the era…
Many countries have state-run banks but few date back two centuries. Today, Germany has several hundred of these loosely affiliated public banks, comprising a major leg of a financial system older than the country itself. They are distinct from the larger banks both in their history and their objectives and, together, these small lenders are…
Banking as we know it today was hardly in existence before the 17th century. However, there was something of a financial revolution in late medieval Italy and it saw a new type of firm offer financial services, and indeed banking services, taking deposits and lending money, even across national borders. These firms were principally interested…
In the history of Germany, few men are as significant as Otto von Bismarck, who unified the country in the mid-19th century. It is perhaps not because of Bismarck that Germany unified, but Bismarck more than anyone else elected the manner in which it would be done. Through the entire saga, he had a financier…
The value banks add to industry is well known, the value of banking to commerce is no less uncertain. By contrast, it can be easier to lose sight of the value banks provide to ordinary people, especially in a historical setting. Indeed, for the first couple centuries of modern banking, common folk hardly interacted with…
At the start of the 18th century, a stock market boom was underway in several European countries simultaneously. Today, this episode is best remembered for the spectacular boom and bust of the South Sea Company in Britain. However, it was just one of the companies involved in a larger mania. In France, a bubble in…
