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41 votes
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How did bank transactions (or "data" transactions) work when it took people weeks to travel vast distances?

Historically, the solution to this was the letter of credit, circular note, traveller's cheque, or similar. Basically, it was an attestation that the bearer of the document had deposited a certain ...
Mark's user avatar
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37 votes

How did bank transactions (or "data" transactions) work when it took people weeks to travel vast distances?

Quite simply, they did not guarantee atomicity or synchronicity, they guaranteed eventual consistency. The general principle is simple: it doesn't matter when the money actually gets moved, provided ...
Austin Hemmelgarn's user avatar
34 votes
Accepted

Why were so many of the earliest banks founded by cloth merchants?

If you get rich in a business you soon find that you have no reasonable 'line of work' for your money, or in other word: capital. So you get essentially too rich for meaningful expansion in your core ...
LаngLаngС's user avatar
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10 votes

How did the Medici originally get into finance?

Cosimo di Medici inherited a thriving "banking" business from his father Giovanni, who was the "Fred Trump" of the family, with Cosimo being like the current President of the United States. Most ...
Tom Au's user avatar
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7 votes

When Lehman Brothers collapsed, what happened to their clients?

They would have gotten their money back. Legally, client assets had to be segregated from the broker's own accounts. This isn't always strictly followed - MF Global notoriously dipped into customer ...
Semaphore's user avatar
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5 votes
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When did banks start giving interest to depositors?

I can' speak to the individual (see update at bottom of answer) you are referring to, but the practice of banks paying interest on deposits predates his birth date of 1869. An example illustrating ...
justCal's user avatar
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5 votes

How did the Medici originally get into finance?

The answer is not so much a specific list of steps (task-list) but more Cosimo's political maneuvering, with family and friends, that propelled him leadership in the Republic of Florence. His ...
J Asia's user avatar
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4 votes
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Why was the Federal Reserve District in the United States so skewed in division?

It is a compromise, using best data available in 1913 when those boundaries were drawn up, between: respecting the natural hinterland of each designated bank; respecting state and county borders; and ...
Pieter Geerkens's user avatar
4 votes

Is it true that there was no such thing as a Hispanic-owned bank in the continental USA until 1969?

I think your first result is correct. The structural impediments to Mexican-Americans founding a bank were significant. There were no banks in the region during the Mexican period. After the Treaty ...
Aaron Brick's user avatar
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4 votes

Why were eighteenth century financial inventions only patentable under French law for 21 months?

SHORT ANSWER The French Assemblée nationale législative saw financial patents as 'dangerous' as they were open to abuse and could be used to exploit people. The issue of speculation was a major ...
Lars Bosteen's user avatar
4 votes
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Why were eighteenth century financial inventions only patentable under French law for 21 months?

tl;dr: France was going through a revolution and needed funds. Patenting financial schemes seemed like a way to spur interest in devising new ways of raising funds. Either due to ethics or ...
corsiKa's user avatar
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3 votes

Were Cypriots able to pay their bills during the "bail in" of March 2013?

I have a business relation in Greece, and a Dutch bank account. Both countries use the Euro. Theoretically the Greek company can transfer the money from Greece to my Dutch account. In reality they can'...
Jos's user avatar
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3 votes
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How did Islamic finance under the early Caliphates profit or take loans if charging interest wasn't legal?

Partly through semantics, by replacing use of "interest" either as a term or calculation by a complete system of "reciprocal gifts". In a sense, there is a bit of willful blindness ...
Pieter Geerkens's user avatar
3 votes
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How was money transferred in early 1900s' Russia?

The U. S. Post Office had instituted a system of money orders during the Civil War which became progressively less cumbersome as the 19th century ended. Western Union introduced its Money Order ...
Pieter Geerkens's user avatar
2 votes

How was money transferred in early 1900s' Russia?

I suppose they used telegraph transfers (similar to Western Union in the West), where available. Telegraph transfer was the main tool of sending money in Soviet Union until 1980s. In places where ...
Alex's user avatar
  • 38.8k
2 votes

How did Islamic finance under the early Caliphates profit or take loans if charging interest wasn't legal?

Given that riba is prohibited, as I understand, OP is asking about consumer loans and banks making a profit. The full-explanation requires detailed consideration of politics and philosophy of Islam. ...
J Asia's user avatar
  • 6,323
2 votes

Why were so many of the earliest banks founded by cloth merchants?

To the excellent answers here, I would add that cloth merchants before the industrial revolution would have aggregated the production of large numbers of suppliers and delivered products to large ...
tbrookside's user avatar
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1 vote
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How can I evaluate the relative fiscal burden on different groups in the US, for various periods between 1790 and 1846?

This is a marxist answer. All answers will be theoretically seated to a question like this, which asks complex questions about theoretically situated categories (purporting to represent real lived ...
Samuel Russell's user avatar
1 vote

How did bank transactions (or "data" transactions) work when it took people weeks to travel vast distances?

Two Generals Problem To more directly answer your question, in technological history, this is a form of Two Generals Problem, which not only factors in latency but the risk of losing transmissions (...
SE Does Not Like Dissent's user avatar
1 vote

Why were so many of the earliest banks founded by cloth merchants?

Because it is non-perishable, cloth makes good collateral. Lenders like to have something to use for security. Land might serve this purpose, but it was monopolized by the nobility. The (middle class)...
Tom Au's user avatar
  • 104k
1 vote

How did the Medici originally get into finance?

https://en.wikipedia.org/wiki/Medici_Bank#Founding The Medicis are said to originate in Mugello, north of Florence, where they were modestly wealthy land holders. A Medici was a Signori of Florence ...
John Dee's user avatar
  • 3,368
1 vote

What was the first electronic creation of money?

There are a number of concepts confused here, and it isn't possible to answer the question precisely. Quantitative Easing - pioneered by the Bank of Japan circa 2007. This is the most probable answer ...
MCW's user avatar
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