I wanted to continue from last session about how currency, credit and written records of credit/deposits started.
Early banking started sometime 3,000-2,000 B.C. They were nothing more than a safe place to store your valuables, such as grains, silver, etc. in such places like temples and other important buildings. These “banks” really liked the idea of charging interest that the Sumerians (which is the area known as Iraq) started around 3100 B.C.
In Mesopotamia, around 1700 B.C., the first laws regulating interest was originated. Hammurabi, ruler of Mesopotamia, declared that banks could not charge more than 33% interest on grains and 20% on silver when exchanges took place…….wow, what a cost for storage and protection.
Private bankers started in Greece around 500 B.C. They were known as “trapezitai” because the transaction took place on a trapezoid table in publics places, such as markets.
At the same time, pawnbrokers had been existing. First started in China around 3000 B.C., with the same principal as today. Between the 13th and 17th centuries, the Church outlawed the practice of loaning money and collecting interest (called “usery”). But this did not stop pawnbrokers from gaining popularity. In France, for instance, commoners, in emergency times, pawned their clothes. In England, there was a nursery rhyme ’Pop goes the Weasel’, that was about a tailor pawning his tools for beer money….the Weasel was his tool and to Pop was to pawn it!
Next time, I will write about “credit” and quotes that we have all heard before but never associated with credit and interest.