Archive for September 12th, 2017

Equifax hackers are demanding ransom in Bitcoins but not dollars or Euros..Why?

September 12, 2017

The usual logic to the question is that bitcoins are anonymous and thus cannot be tracked, so it is a currency for the criminal class.

Jeffrey A. Tucker gives another perspective:


Britannia, Jane Austen and the surprising tale of why money has long had a female face in England…

September 12, 2017

We usually are made to think/believe that finance is mainly “a men thing” and women are best kept out of the picture. However, this is not entirely true. This blog has written about women stock brokers  in early history of finance in NY. There must be evidence of their presence in other finance industries as well (for an unrelated area see women’s contribution in computer programming).

Following 2008 crisis, it was suggested that if there were more women in bank boards, may be banks would have been more stable. A recent paper does show this to be the case.

Now, Prof. Claudine van Hensbergen (Eighteenth-Century English Literature, Northumbria University, Newcastle) takes us further back in time. She reflects on the recent decision of Bank of England to print Jane Austin notes and says money has always had a female face in England:


The origins of financial development: How the African slave trade continues to influence modern finance..

September 12, 2017

Interesting paper by  Ross Levine (who else), Chen Lin and Wensi Xie”

In this paper, we contribute to research on two interrelated questions: What are the historical determinants of national differences in financial development and through which mechanisms do these historical factors influence the operation of modern financial systems?

We focus on the historical African slave trade during the period from 1400 – 1900, which Nunn and Wantchekon (2011) show has had an enduring effect on social cohesion and culture across Africa. More specifically, we examine the impact of the intensity with which people were captured, enslaved, and exported from Africa on financial development today and key institutions that shape modern financial systems. With respect to the first question, Pierce and Snyder (2017a) show that the slave trade is negatively associated with firm access to credit. We contribute by showing the intensity of the slave trade across African countries is also negatively associated with household access to credit and overall financial development. We further show that the negative association between slave exports and firm access to credit varies in a theoretically predictable manner, as the association is especially pronounced among firms that depend heavily on external finance for technological reasons.

With respect to the second question, we evaluate three potential mechanisms linking the historical slave trade to modern finance. A large body of evidence indicates that information sharing institutions that reduce information asymmetries about potential borrowers, the degree of trust that individuals have in financial institutions, and the quality of legal institutions influence the operation of modern financial systems. We discover that the intensity of the African slave trade in the 1400 – 1900 period is strongly, negatively related to the quality of information sharing institutions and trust in financial institutions but is not strongly related to legal institutions. These findings are consistent with the view that two mechanisms through which the historical slave trade continues to influence modern financial systems across Africa are information sharing institutions and trust.

Need to read it carefully..

When Marco Polo saw the paper currency for the first time…

September 12, 2017

Dave Birch has a piece in Medium. 

History of paper money started in  China and via Marco Polo tales the world came to learn of it.


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