Medieval Finance

[AteMoose]

The spread in wealth between a peasant and the king was smaller than the present gap between the chav and the banker. Wealth and capital have never hitherto been concentrated to the degree currently found.

Anyhow, the actual Guardian article is daft. Inflation was a massive problem in medieval society and ultimately led to a series of fairly nasty revolts. The price for goods was fixed, the price for rents was not. Pretty obvious where that leads...

Talk about dumbing down, even Guardian writers don't bother actually reading Marx these days. I guess they are working from Wikipedia pages like everyone else.

really? I really think the spread between the king and a serf would be alot more. The king owns the entire country and lots of palaces, forts, army's, navy's and a an entire nation of slaves. The serf owns nothing apart from a couple of pots and pans, and if he is lucky the odd animal. Today a banker might have a couple of million, perhaps a billion or two if they are very very good at what they do and the chav has a house they got on right to buy, a car, motobike, flatscreen... IMHO the gap is less today.

Edited June 23, 2009 by moosetea

[Stars]

jeez - the inclosure acts allowed investment in the land - sure compensation would have been appropriate to the masses, but only a fool would suggest we weren't, in the long run. massively richer for it...

You are conflating the benefits of enclosure itself (the exclusivity of land use), with the supposed benefits from speculation in land's price

Speculation in the rising price of land has never created one single penny of value, quite the converse the activity has done nothing but lumber producers with spiraling and unmanageable costs (the extra costs producers experience are where the profits of speculation come from).

Edited June 23, 2009 by Stars

[Injin]

They kept going though, they didn't just stop once they'd secured what they had. They kept investing to get more agricultural land.

Edit: it would be interesting to know if the newly-reclaimed land was immediately privately owned -- I don't know the answer to this.

It's worth remembering that mobility was an issue for yesterdays men. We forget that the world is a lot smaller on horseback.

If you were there, it was probably yours in most practical meanings of the term.

[huw]

yes it does - the fact it was THAT generation was only because they were the first ones to be asked

Not every building society decided to demutualise when the opportunity came up. But as I said, the weakness of the common/mutual model is its inability to resist the offers/pressure from more rapacious alternatives so I think we're in broad agreement there -- it's possible (inevitable?) that the remaining BSs will be looted by a single generation too.

it had continued for a 1000 years and still left people impoverished and the landscape exploited - in both the case of mediaeval collectivism as well as Red Indians who had already done much of the white man's work for him in wiping out buffalo - they only lacked guns to finish the job off

Guns might only be possible in a property-based system that enables the appropriate investments to be made So I actually agree that our model of state-backed property-rights is "better" in that it produces the winning system ... but it wins by expanding/consuming at a rate that will also bring it down in the end, after it's crowded other systems that could have lasted longer and led to more overall human fulfilment.

"Impoverished" is relative and depends on what you measure and when you measure it. We feel rich at the moment largely because we're still blowing through our fossil fuel trust fund, and because our addiction to exponential growth hasn't quite caught up with us yet.

Edited June 23, 2009 by huw

[tomandlu]

lmao x10. the socialist guardian does not understand money wealth or economics.

Someone on the Guardian letters page agrees with you...

It wasn't all anarcho-syndicalist peasants

The Guardian, Wednesday 24 June 2009

Tom Hodgkinson's portrayal of the Middle Ages as an anti-capitalist paradise in which trade was undertaken according to principles of comradeship and justice is not even close to accurate (Shortcuts, G2, 22 June). In fact, with its rapidly fluctuating economic cycles, calamitous bank failures, violent strikes and extreme disparity of wealth between rich and poor, the Middle Ages resembles our own times perhaps a little too closely.

Businesses were organised as partnerships rather than limited companies, but that did not stop owners from behaving like despots and, on some occasions, treating their workers like dirt. The guild system all too often served as a system for repressing workers and depriving them of their rights, as is shown by the repeated strikes in places such as Florence, Genoa, Rome, Ghent and Bruges. And while usury was banned in theory, in fact the popes themselves were Europe's largest borrowers of money at interest, from the Medici bank in Florence.

As for the just price, while authorities did try to fix prices for some commodities, St Thomas Aquinas, the greatest theologian of the Middle Ages, argued that the only truly "just and fair" price was what the buyer was willing to pay. In other words it was the buyer, not the seller, who should determine the value and thus the price - ie let the market decide. And often it did, with dire results. In the 14th century, several Italian banks lent large sums to the government of England, ignoring the political risks of doing so. When the English crown repudiated the debts, the banks crashed and investors were ruined. Irrational exuberance is, it would seem, as old as civilisation itself.

Morgen Witzel

University of Exeter Business School