After the French Revolution, the advancing armies of France’s new militant republic distressed many in Europe and some fared far worse than the continent’s merchants during these years. Nonetheless, merchants and commerce were displaced by the wars that lasted more than two decades. Yet, whatever the destruction brought by the wars, the cities that…
While not uncontested by other Italian city-states, Venice was a candidate for the foremost financial center of Europe in the 15th century. It was not home to many financial institutions but the ones it did possess were among the largest in Europe. These were banks tied to big merchant families, often noble families. Yet,…
Various Italian city-states excelled in banking as it existed in 15th century Europe. In or around this period, Siena, Florence, Venice, and Genoa each were home to some of the largest European financial institutions of their day. Some lasted for over a century, others for only a small fraction of that time. Though the…
Eras of rapid change are much more likely to give rise to financial bubbles than stagnant periods. The former are far more prone to excessive enthusiasm, the expansion of credit, and the accumulation and mis-investment of surpluses than the latter. In the 1860s, the American Civil War abruptly cut off one of the world’s…
The start of the Great Depression in Europe is often dated to May 11, 1931, when a run on Austria’s largest bank, Creditanstalt, began. Bank failures had already been increasing the prior year so whether the near failure of Creditanstalt actually caused the slide into the Great Depression or was simply its largest casualty…
America was still an agrarian country in the 1850s. Nothing could stimulate its economy as much as high prices and demand for agricultural products. Favorable conditions for farmers existed in the middle of that decade. During the boom years, gold production and a railroad building spree also stimulated demand. Financial institutions like banks and…
In 2008, Iceland was afflicted by a banking crisis caused in part by its banks raising huge sums of deposits from foreign savers at high interest rates and the investing of these deposits in questionable assets marked at values that proved impossible to realize. Banking assets as a percentage of Iceland’s small GDP grew…
There was an international trend towards the deregulation of many industries from the 1970s to the 1990s. In Britain and America, these changes were associated, excessively by both their friends and foes alike, with Thatcher and Reagan. In any case, the liberalization of commercial life, and finance specifically, was far from unique to these…
There are some people whose biographies serve as chronicles of an entire time and place. During the financial bubble in American stocks in the 1920s, one such man was Charles Mitchell. He led one of the world’s largest banks as well as its securities division, the largest such operation in the world. During the…
The market for railway company bonds grew quickly in the mid-to-late 19th century. Laying new track was very expensive and the returns would not come until a line was completed. For larger projects, such as those rail links crossing an entire continent, this could be years away. Thus, financing was as important an input…
