History Of The Interest Rate-Looking For Light At The End Of The Tunnel
If you are looking for some “light” reading, learning more about the history of the interest rate can actually be pretty interesting.
While I do not claim to be an expert, not by a long shot, I have found some interesting information on the changing thoughts over the centuries in regards to the interest rates.
The history of the interest rate is actually a very long history. Back with the Greeks and even before.
For this time in history, and those societies, the concept of interest was unheard of and pretty much considered unholy.
There are instances of some rulers actually executing anyone caught charging interest.
This was pretty interesting to learn especially when you kind of consider the mindset behind the no interest philosophy.
You see, back in the “olden days” they worked very hard for everything they had. Life was a lot harder than we have it today. They had none of the modern technologies that we have today.
No washers, dryers dishwashers, grocery stores, etc. Every single thing they needed in order to survive they had to make or grow all on their own. It was hard work just living.
So, you can imagine their disdain at the idea of earning money for doing nothing at all. This was how they thought of interest.
Around the time of the Roman Empire things began to change. Rome would allow interest but usually for other countries with whom they didn’t really have a very good relationship.
They also set out the exact amount of interest that could be charged. They were very clear on this point.
After the breakup of the Roman Empire the Church got involved in the matter of interest. It went back to the no interest ideals of earlier times.
Though, at first, the no interest only applied to the common people and not the clergy. Eventually, though, the no interest policy extended even to the clergy themselves.
This anti interest doctrine remained in effect until the time of the industrial revolution. At that time, as you might expect, there was more time.
With some new machines and tools life was a little easier and allowed a little more free time and a slight shift in the mindset that you have to work hard for your money.
That mindset was still very strong, mind you, but it had subsided to the point that the idea of making money from interest, basically making money with no work, wasn’t as alien or repugnant as it was in earlier centuries.
Today, we understand interest a lot better. For all of us alive today we have never known a time when interest wasn’t just part of mainstream life.
Even so, there is still a lot about interest that a lot of people don’t fully understand. Gaining a little more understanding of just how it all goes together can help you stay ahead in the whole financial arena.
I hope this history of the interest rate has been interesting for you. There is much more you can learn about. In this short article I’ve only given you the basics. Have fun exploring even more!