The midland journal. (Rising Sun, Md.) 1885-1947, 1892-05-06
THE BANK OF VENICE.
A FINANCIAL SYSTEM THAT EXISTED
FOR 700 YEARS.

At this time, when it appears thai
many Of the great newspapers through
out the country are running riot ovel
their paid endeavors to direct popular
thouehton national monetary affairs, il
appears to the writer most appropriate
to call attention to one of the first, il
not the first, bank On record. in the
worlds history. This bank did all the
banking business for the republic Of
Venice, and Of most ofthe then civiliz-
ed world. 1t existed for nearly 700
years. during which time it never sus-
pended payment even temporarily OF
failed. According to historians, it en-
joyed the admiration and unreserved
confidence of all the people. The UNI
parallel facilities it efforded enterprise,
the strangth it gave the government
and the premium its issues Of paper
commanded over gold and silver, prove
it to have been based upon more correct
principles than our ever distracted sys.
TENS Of ups and downs of the present
day. Students Of financial science
would do WE'LL to study this illustration
with particular care.
A. d., iii, war between the We
netian republic and the Grecian empire
precipitated necessity upon the peo-
pie under which the bank of Venice
was established much in the same man.
ner as our late civil war gave rise to our
greenback Systematic currency or ex.
ezange medium in both cases being
pisaiseiy of the same nature, and
possessing the same basis and qualities.
After having exhausted every other
financial resource, the Venetian govern
ment was obliged to resort to what, is
falsely called forced loan" As with
our government it required men and
army equipment to prosecute the war,
and as money vas necessary to pay for
these. and the government having
none, it proposed to borrow it of its
own citizens in such sums as one was
able to contribute. Fer such sums
loaned the government simple credits
were given on the books of the govern
ment treasury, and were made trans.
ferable in part or in whole, and thus
become medium of exchange, and a
substitute for money in payment Of
debts.
The only difference between the
Venetian and the greenback system was
that the first gave book credits, the lat
ter its tokens or portable bills of ex-
change. The policies and systems were
identical, except the greenback system
is more simple as it avoids the necessity
Of handling coin. The Venetian green
backs were simply inscriptions of credit.
A man who had credit at the Venetian
treasury used it in purchase of goods
or payment of debts, just as we use
greenbacks. These credits were ire
deemable by the government. REIN
bursement Of the original loan came tc
be regarded as both unnecessary and
undesirable, Every creditor was REIN.
bursed when he transferred his claim
on the books of the bank.
The Bank of Venice was simply 9
government bureau, having charge o.
this fund, similar to our own bureau o.
the Comptroller of the Currency.
The credit of this bank, which wal
the most popular medium Of exchange
the world ever had, commanded pre-
MUM over coin for two reasons; first
security from loss or robbery, and it
convenience of handling, and second
from its perfect security against tn,
prevailing fraud Of counterfeiting ant
debasement of coin.
The high estimation in which thi
ideal money of Venice was held is illus
trated when history informs us that from
the commencement coin was contin-
uaily being deposited for the bank
credits, knowing that it would never
be returned to the depositor: Crowel
says:
If individuals could make purchases
and pay debts by transfers in bank, the
public treasury could well afford to re-
ceive it in payment of its dues, as i
would only be equivalent to taking ny
its own obligation.
Thus for nearly 700 years existed
system offnance, based upon publ,
credit, with entire confidence on th,
part Of the people, and good faith oil
the part Of the government, converting
the public debt into currency or me.
dunn of exchange, and which produce,
degree Of prosperity never before 0
since reached by any people.
- T. y n