Ancient & modern

1 November 2008

Peter Jones on ancient finance

Last time we saw that the Romans did not have anything like a banking system i.e. a machinery for creating credit through various negotiable instruments. What they did have was minted coin — and that was the sole monetary instrument. So at a personal level, if you wanted money, you went to a rich friend and hoped he would help you out with a loan. But if there were no bankers in our sense, there were small-scale businessmen such as money-changers, charging up to 5 per cent to change high-value into low-value coins, who also received deposits and advanced credit. We hear of one Novius receiving a short-term loan of 10,000 sesterces from such a businessman against collateral of grain, chick-peas, lentils and spelt. Penalties for late payment are often attached.

If you wanted serious money, however, this could come only from elite financiers, who were looking primarily for security, or from risk-taking ‘entrepreneurs’, more interested in profit. These are the sort of people who would go into partnership together and bid for big Senate contracts — everything from building aqueducts to supplying the army or raising taxes.

There were still crises. In ad 33, the emperor Tiberius solved a liquidity problem by offering interest-free 3-year loans up to 100 million sesterces against real estate or buildings. In 216 bc Rome ran out of money during the war against Hannibal. It asked for money and wheat from Hieron of Syracuse; deferred payments to those who had won contracts to supply its army in Spain and carry out building works; sold off assets; equipped its fleet through a special tax on the rich; and appealed for contributions.

But there was never any question of Rome borrowing money. As a result, there was no such thing as national debt, that ‘swindling of futurity’ to which Thomas Jefferson referred. Likewise, while providing credit (out of hard coin) was understood, it was for immediate use; there was no concept of ‘furthering economic investment’. Our world is very different, and banks central to it. They have brought phenomenal economic benefits. But they have forgotten a rule even the Romans knew: Horace’s aurea mediocritas, ‘the golden middle-way’. The emphasis is on ‘golden’; for the avoidance of extremes is where the real gold lies. It should be emblazoned over every bank.

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Eddie Kovacs

November 7th, 2008 6:00am Report this comment

Nonsense. Rome couldn't do so much borrowing as modern nations do, but it could and did debase its coinage severely. We also have records in the writings of Suetonius in particular about the inventive methods Rome (or rather, its cruel emperors) used to raise cash when the treasury ran out: it mostly involved condemning lots of rich people to death on trumped up charges and seizing all their assets. Of course, there were also the rapacious taxes Rome levied hard on the poor and even harder on its middle classes, which naturally proceeded to vanish. As an economic example, it'd be difficult to imagine a worse place to look for sound monetary policy than ancient Rome. We'd do better to seek an example in some modern nation that isn't foundering under its debts, if any such nation exists.

DWIGHT BAKER

November 7th, 2008 10:40am Report this comment

When the money lenders have no more respect for the LAW all hell will break loose.
HOW TO STOP THE DEVOURING BEAST
FROM WITHIN BEFORE FEB 2009?
BY Dwight Baker
11/6/2008
Words 439

Without a unified hard working and dedicated CONGRESS at this LATE DATE ----- that has the will to do their jobs of bringing charges against the many that have disregard and defied our RULES of LAW in our CONSTITUTION then all may be lost. And for that to come about at this LATE DATE seems to me to be wishful thinking. Unless WE THE PEOPLE unify and demand it be done.

For a long time CONGRESS has practiced the SEE SAW YAW of LAW. And to that end nothing much has been accomplished for the good of WE THE PEOPLE. Their lacks of oversight of our people our property and our personal security our national security, borders and our held communed wealth in America has become a FREE FOR ALL among the pirates, bandits and tyrants from within and around the world.

CONGRESS has not enforced the LAWS in our CONSTITUTION. And Because of that CONGRESS inability to properly adjudicate righteous judgments as a sane sanguine and communed body for all good and godly matters have languished and been forlorn and forgotten. CONGRESS has not enforced the RULE of LAW with impeachments charges indictments trials penalties sentences and banishments for those many that have lain waste our people and now our entire financial base. And CONGRESS has stood by and allowed robbery to come to our nation that may run into the ground our great nation.

It has become obvious that many from around the world is pleased with our recent elections and that is a good thing. But we must also understand that just one man with a new plan and just a few added to CONGRESS is not going to bring the sudden impact of change that is needed now.

My best guess is that over 5 million Americans know the many problems that exist now. And I personally think it would be wise for those 5 million to stop talking about the problems and stress on CONGRESS to do their jobs NOW. Bombard them daily with all your research data and make them close the doors for those many to escape. One thing for sure the criminal mind only respects the harsh hand of judgments and that is all. And now is the time to send that message for NO ONE TO EVER TREAD ON US AGAIN.

Therefore how do WE THE PEOPLE stop the devouring beast from roaring within our Nation? The only way at this LATE DATE before the NEWLY ELECTED takes office in 2009 is DEMAND our CONGRESS to fix all that is broken now, to stop the blood letting any longer.

So please ALL do your part and make those DEMANDS on CONGRESS to do their jobs NOW as they took an oath and sworn to do when taking office. And further state it is them WE THE PEOPLE are looking too to effect that change NOW and it is unto them if they do NOT that will NOT escape the eye of judicial scrutiny.

Carl Street

November 8th, 2008 1:13am Report this comment

Peter is over-simplifying and ignoring the Roman penchant for replenishing its treasury by inventing trumped up reasons to invade and loot neighboring countries.

Fortunately, in our ethical, law-abiding, modern world no nation today would engage is something as heinous as invading other nations who have coveted resources on the pretext of fighting "terrorism" and establishing order while coincidentally seizing control of their wealth.

Isn't it amazing how far we have come in the 2,000 years since Roman imperialism plagued mankind under the guise of "civlization".

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