[shabbir]

When analyzing the problems faced by the modern banking industry, it is better to get into some of the developments in the bygone centuries.  To a certain degree the Venetian merchants fell into the habit of placing their money within the Chamber, for safe keeping.  From this one approach the business of deposit was introduced and it is the second branch of modern banking.  It was later found that a credit for money deposited in the chamber was equivalent to the cash in hand.  Such a custom or approach was introduced for effecting payments through the transfer of these credits from the account of the payer to the account of the receiver.

Thus, every merchant was obliged to open an account with the bank.  All the payments of bills of exchange in wholesale transitions were required to be made there, and in the manner described above.  This method of payment was plainly a rude approach towards the invention of bank notes.  The circulation of these bank notes constituted the third and the last branch of the banking business.  This is much evident in a modern bank.  That part of circulation involving bank cheques is only a very slight modification of this Venetian practice.  The Bank of Venice long remained without a rival, but by the beginning of the 15th century, similar institutions, were established at Genoa and Barcelona.  They were cities that were the pride of Europe in those times.  They were only second to Venice when considering the extent of trade and commerce.

The ‘table of exchange’ at Barcelona and the Chamber of St. George at Genoa is an almost exact copy of the Bank of Venice, and soon it obtained an almost equal status in credit and celebrity.  The bank of Barcelona was established in 1401 and the Bank of Genoa in the year 1407.  As the center of commerce got shifted to the north, the Bank of Amsterdam was established in 1609.  Banks working on the same principle as that of the Bank of Amsterdam was established afterwards at Hamburg and some other parts of the commercial towns and free cities in Germany.  

LINK REMOVED - Thread is now a discussion of the banking system. - Karajorma

[Stormkeeper]

* Stormkeeper is highly suspicous of this new poster.

[Mongoose]

LINK REMOVED - Thread is now a discussion of the banking system. - Karajorma

Banks have money in them!

[Scotty]

But that money's value is determined by the government!

[Stormkeeper]

But banks still have money in them!

[Scotty]

When the government controls the value of money, that can change in about two months.

[BloodEagle]

*shrinkwrapped*
When analyzing the problems faced by the modern banking industry, it is better to get into some of the developments in the bygone centuries.  To a certain degree the Venetian merchants fell into the habit of placing their money within the Chamber, for safe keeping.  From this one approach the business of deposit was introduced and it is the second branch of modern banking.  It was later found that a credit for money deposited in the chamber was equivalent to the cash in hand.  Such a custom or approach was introduced for effecting payments through the transfer of these credits from the account of the payer to the account of the receiver.

Thus, every merchant was obliged to open an account with the bank.  All the payments of bills of exchange in wholesale transitions were required to be made there, and in the manner described above.  This method of payment was plainly a rude approach towards the invention of bank notes.  The circulation of these bank notes constituted the third and the last branch of the banking business.  This is much evident in a modern bank.  That part of circulation involving bank cheques is only a very slight modification of this Venetian practice.  The Bank of Venice long remained without a rival, but by the beginning of the 15th century, similar institutions, were established at Genoa and Barcelona.  They were cities that were the pride of Europe in those times.  They were only second to Venice when considering the extent of trade and commerce.

The ‘table of exchange’ at Barcelona and the Chamber of St. George at Genoa is an almost exact copy of the Bank of Venice, and soon it obtained an almost equal status in credit and celebrity.  The bank of Barcelona was established in 1401 and the Bank of Genoa in the year 1407.  As the center of commerce got shifted to the north, the Bank of Amsterdam was established in 1609.  Banks working on the same principle as that of the Bank of Amsterdam was established afterwards at Hamburg and some other parts of the commercial towns and free cities in Germany. 

LINK REMOVED - Thread is now a discussion of the banking system. - Karajorma

Am I the only one that fails to see a point to any of that?

------

When the government controls the value of money, that can change in about two months.

What screwy efficient government do you have? Because I can tell you right now, I've never seen any form (local, state, etc.) of government get anything done in a mere two months.

[Woolie Wool]

I think he means that the government can destroy the economy in two months, not change it with any actual goal in mind. And it certainly can if it uses the Weimar Republic approach to crisis management.

Also, was the original OP and link supposed to be some sort of lending deposits/interest is EEEEEEVIL sort of thing?

[Polpolion]

I kinda wish our money was still backed by silver.

[Scotty]

I wish our money was backed by anything.  Silver is my first choice for that, though.  Gold is too useful for other things.  Leaving aside dispute on what should be used, the point is to use something at all.  A currency not backed by anything is just so much paper.

[BloodEagle]

Silver is an excellent heat distribution material. I'd hate to see the price on it skyrocket.

[iamzack]

how about unobtainium?

[Aardwolf]

how about unobtainium?

or... leaves?

[Scotty]

Silver is an excellent heat distribution material. I'd hate to see the price on it skyrocket.

If a currency were backed by silver, the price of silver would be fixed.  Back after WWII (IIRC, might have been a different war), the U.S. dollar was backed by gold, and was determined as 1/35th an ounce of gold.  We have since stopped using any standard, but that precedent has been made.

[tinfoil]

how about unobtainium?

or... leaves?

But the people would just burn the trees

[Aardwolf]

Of course... to combat inflation.

[General Battuta]

I wish our money was backed by anything.  Silver is my first choice for that, though.  Gold is too useful for other things.  Leaving aside dispute on what should be used, the point is to use something at all.  A currency not backed by anything is just so much paper.

I'm pretty sure this would be truly horrible for our economy.

[Scotty]

Really?  Explain please.

EDIT:  I think I can see what you mean, but I'll wait for confirmation on your part before I say anything.

[BloodEagle]

Silver is an excellent heat distribution material. I'd hate to see the price on it skyrocket.

If a currency were backed by silver, the price of silver would be fixed.  Back after WWII (IIRC, might have been a different war), the U.S. dollar was backed by gold, and was determined as 1/35th an ounce of gold.  We have since stopped using any standard, but that precedent has been made.

Correct me if I'm wrong, but wouldn't creating a silver standard require the removal of a vast amount of silver from the open market? And wouldn't less availability cause the value of silver as a commodity to go up?

[General Battuta]

Really?  Explain please.

EDIT:  I think I can see what you mean, but I'll wait for confirmation on your part before I say anything.

I don't remember my econ well enough, but basically, a large part of economic policy concerns managing the money supply. It's important that new money can be created or restricted as needed. Pegging the dollar to the value of silver would probably keep its worth way down and...uh, other bad stuff. But I'm not enough of an expert to specify.

Rian might know, I'll ask her.