Friday 25 May 2012

Collapse of monetary commerce? Lesson from history

Found this interesting article about a new BBC programme

I have done quite a bit of reading recently about the late Roman period. I am quite fascinated about the period from 400AD, where the frequent invasions and uprisings, decline of the power of Roman emperors, usurpers to the Roman throne etc eventually led to the Rescript of Honorius, the response of the emperor to the Briton's appeal for help to protect them from invading hordes.

The end actually came more gradually. As late as around 450AD (I hate it when people try to use C.E so that they don't have to acknowledge religion!) St. Albans still had some semblance of Roman civilisation and community.

However, as people left the cities and made more of a subsistence living for themselves in the countryside, money wasn't needed any more as barter was much more useful. A similar thing happened when Argentina went bankrupt a few years ago, money no longer had any meaning and so people resorted to their own barter economy.

The same thing will probably happen in Greece, irrespective of whether it leaves the Euro or not. But if it leaves the Euro, without any form of backing to the "Promise to Pay" form of money - which of course has to be underwritten by the reserves of the Government or central Bank - then there is no basis for the currency. They'll get through it eventually - Argentina is now sufficiently back to normal as to throw its weight around about the Falklands!

There are some interesting parallels in the article, rise of radical movements, migration, greater divide between rich and poor etc.

I once saw a very interesting programme about the eruption of a volcano in about 510AD which caused a global cooling for 3 years or so - mass famine, failure of harvest, no summer - and we struggled nowadays with a small Icelandic volcano! (which I saw the year before it was famous!). This I think killed off - with a handful of exceptions -  the remaining western civilisations and then end of the Roman world was truly complete.....

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