In the years before the Great Kanto Earthquake of 1923, fire insurance was gaining more widespread adoption in Japan. For many insurance companies, it was becoming their largest line of business. Unfortunately, the earthquake and the fires that followed challenged this growth. Many looked to the insurance companies to pay claims after the disaster…
The history of paper money in China began when merchants attempted to work around shortages of metal coins during the Tang Dynasty. Government issued paper money became well established during the Song Dynasty about 860 years ago, or about five centuries before paper money appeared at any particularly notable scale in the West. However,…
If you needed to borrow money in 6th century China, and neither family nor associates in business could be relied on, you had few places to turn to. There were no banks. Even private moneylenders, at least with operations that extended far beyond the skill and time of a single person, were few. The…
Today, Singapore ranks as one of the world’s largest financial centers. The city’s financial industry is underpinned by its role as a center for foreign exchange trading and foreign currency lending. It developed this role not so much organically or spontaneously but as a result of planning. Still, this doesn’t tell the whole story. A…
It is understandable to presume, when the world first became better connected by trade, that this trade was an unregulated free-for-all. However, though governments then might have been weaker than those of today, they were if anything even more motived then than now to regulate and control trade. This was true in Europe, where governments…
In 1850, Japan was an economy intentionally closed off from foreign trade. Even Japanese merchants and bankers were not well regarded in the country, let along foreign ones. By 1900, Japan had come a long way industrially and financially, possessing a developed banking system and large industrial firms. Shibusawa Eiichi was responsible for much of…
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…
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…
When commodity booms materialize, the effects are felt not only where the sought-after materials are mined or harvested but also in the financial centers of the world, the places where the commodities are marketed and traded and where production and trade is financed and insured. Rubber was a new gold in the late 19th and…
Stock exchanges usually follow, rather than lead, fundamental developments in a country’s financial system. Indeed, up until the late 20th century, relatively few countries even had a single stock exchange. One of these recent introductions to the workings of a stock exchange occurred in Iraq with the founding of the Iraq Stock Exchange very soon…
