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The Suffolk Bank of Boston established a regional clearinghouse system known as the Suffolk system. Traditional interpretations of the system emphasize the benefits created by the system's clearing operations and effective coinsurance scheme. Although the system created such benefits, it did so by intimidating and coercing member banks. The system is analyzed using modern theories of networks, including membership externalities and appropriate pricing rules. Because the Suffolk Bank did not set efficient prices for its services, an alternative network was established and the system collapsed.

Modern interpretations of free banking argue that lightly regulated banking systems are either unstable and undesirable, or that free competition in banking generates the same favorable outcomes as competition in any other industry. The historical evidence shows that America's experience with free banking can support either position depending on the time and place under study. Free banking laws in antebellum America induced massive entry and, often, equally rapid exit in its early years (sometimes referred to as wildcatting), but later experience was more favorable. After 1845, failure rates among free banks fell to about the same rate as chartered banks. Free banking created some perverse incentives for banks, however. Free banks under‐issued banknotes relative to profit‐maximizing banks and free banknote issues demonstrated less seasonal elasticity. Both features were the result of the requirement that free banks hold unbalanced portfolios, top heavy with government bonds.

Based on his first fieldwork in Ghana in the 1960s, the author recounts a story of being offered Confederate US banknotes for conversion, and uses this story to recount how he funded his initial period of anthropological research through money changing and money lending. He made quite a good living this way, so much so that he began to feel guilty about amassing such wealth. So, he spread it around, hiring research assistants. Instead of discharging the debt he felt he owed, however, this only increased it, as he became positioned as a big man who was expected to redistribute wealth to the people. Such grey zones in fieldwork spotlight the ethical quandaries of credit, debt and money in the anthropological encounter as well as in the making of the modern world.

This chapter looks back on how the Hong Kong dollar was stabilised in October 1983. It presents a combination of theoretical discussion and historical narrative of the events between late September and mid-October when the new scheme was adopted. It examines why the “interest rate weapon” failed, and discusses some of the international political events (the Sino-British negotiations over the future of Hong Kong) and local dramas (the run on the supermarkets) that formed the background to the currency crisis. It also discusses important issues in currency stabilisation such as the choice of monetary standard, whether to adopt partial or full convertibility of HKD banknotes to USD at the fixed rate, the choice of currency, and the choice of exchange rate. It also outlines the institutional arrangements of the new scheme, anticipating some of the later discussion of the cash arbitrage process.

The conclusion summarizes the archaeological and museum themes covered from World War I to the Egyptian Revolution of 1952, using the symbolism on coins, stamps, and banknotes along with other media to show shifting ideological emphases. The revolution quickly completed the Egyptianization of personnel in the Antiquities Service and universities, but a range of old-new challenges still lay ahead. The book concludes with a glance ahead to Nasser's shift from Egyptian to Arab nationalism and the UNESCO-sponsored campaign to salvage the monuments and archaeology of Nubia ahead of their flooding by the High Dam at Aswan.

This chapter discusses the experiences and challenges faced by the former governor of the National Bank of Vietnam. It also describes his experiences prior to the bank's establishment, as Vietnam negotiated with France in the Four-Party Conference on the various issues related to the transfer of sovereignty. During this time, Vietnam had inherited from the French government an empty treasury, a disheartened French business community, and a bureaucracy entrenched in antiquated colonial methods. It was against this gloomy backdrop that American aid began to arrive, first to help Northerners resettle in their new land, and later, to fund the import of American consumer goods for general public consumption, an initiative known as the Commercial Import Program. The chapter also discusses the 1956 Banknote Exchange Scandal, which highlighted the flaws inherent in the banknote counting process.

The chapter offers a brief overview of British banking in prewar China before the outbreak of the Sino-Japanese War in 1937. Focusing on the two leading British banks in Shanghai, it traces instructive links between the changing political climate and banknote circulation volumes.

The essence of central banking is the issuance of central bank money—being itself defined as dominant financial money used at a large scale for payments and being of the highest possible credit and liquidity quality amongst all financial assets, such that payment through it is accepted as settlement of any other financial claim. This chapter elaborates on the nature of central bank money and reviews the pre-1800 theory and practice of central bank money issuance. It is shown that the nature of central bank money and its benefits were well understood by early authors. Moreover, the 25 central banks that issued (or at least aimed at) issuing central bank money before 1800 are introduced. The types of central bank money (deposits, banknotes, certificates of deposits) are briefly reviewed.

This chapter describes the pressure that arose from certain groups of planters to make available medium-term credit for agriculture. The two prime ministers in power after abolition, Joao Alfredo and the viscount of Ouro Preto, advanced funds to the planters through the banking system, and, taking advantage of a favorable international situation, permitted banks to issue banknotes convertible into gold. Ouro Preto, who governed during the final five months of the empire, sought to regain the planters' allegiance to the monarchy by lending them large amounts of public funds. Although these loans saved neither the declining coffee barons of the Paraiba Valley nor the monarchy itself, easy money provoked a speculative boom known as the Encilhamento.

This chapter examines the quotation claiming that Jews invented marine insurance and bills of exchange, which can be read from a compilation of maritime laws assembled with commentary by a provincial French lawyer, Étienne Cleirac, published in Bordeaux under the title Us et coustumes de la mer (Usages and Customs of the Sea). By adding bills of exchange to his commentary on marine insurance, Cleirac paired two credit contracts that by the mid-seventeenth century had become indispensable to long-distance trade and were handled by merchants of all sorts. By this time, marine insurance was no longer considered usurious. In contrast, bills of exchange continued to ignite fierce debates over usury. The ease with which bills of exchange could be passed from one person to another generated the erroneous but indelible impression that they were like paper money. However, unlike banknotes, they were not fully negotiable, nor were payers obliged to accept them.

This chapter describes the history and banknote circulation patterns of the chartered banks. The Chartered Bank of India, Australia, and China (CBIAC) was established in the City of London in 1853 through the provision of a Royal Charter similar to the one given in 1851 to the first British overseas bank in Asia: the Oriental Bank Corporation. Its story and balancesheet figures are used as the basis for a comparative discussion of the role that British and other foreign banknotes played in the Chinese economy before World War II. The CBIAC's operations in Southeast Asia had to accommodate competition by an increasingly vigorous Chinese banking sector. Overseas Chinese firms began to complement foreign banking hegemony in the region from the 1920s, with family-owned modern enterprises such as the Ho Hong, Chinese Commercial Bank, Overseas Chinese Bank, and Sze Hai Tong setting the tone.

This chapter discusses the different aspects of the Hong Kong and Shanghai Banking Cooperation (HSBC) and its note issue in Shanghai. Banknotes first issued by the HSBC in 1866 helped resuscitate financial markets during the late Imperial era and the demand for these banknotes shot up amid the political and economic disintegration that typified warlordism in the early Republican period. The fiduciary principles in the HSBC Ordinance were partly inspired by nineteenth-century Scottish banking practices, whereby private banks enjoyed lucrative note-issue prerogatives. The surging popularity of quasi-foreign notes in China coincided with the phase-out of HSBC's Southeast Asian issue in the 1910s. The Banks' argumentation had to be adapted to suit the tastes of Treasury regulators, whose main concern, during that period, was the money supply in colonial Hong Kong.

This chapter describes the Hong Kong and Shanghai Banking Cooperation (HSBC) and its China note issue in the late Republican era, 1925–1937. The May Thirtieth Incident broke out in Shanghai in 1925, when a labor dispute in a Japanese textile factory situated in a British-policed concession area rapidly escalated into bloody demonstrations and a year-long nationalist boycott against British goods, sweeping across other treaty ports and Hong Kong. HSBC capped its entire outport issue in anticipation of further anti-foreign agitation during the Nanjing decade. The Chinese petitions were even wider off the mark as regards HSBC, whose circulation volume on the Mainland declined sometime after 1927, and whose managers had by then become insecure about their future prospects on the Mainland and reluctant to engage in massive silver trafficking for fears of antagonizing the Chinese and British authorities.

This chapter discusses the political, institutional, and technological threads emanating from the exposition of British banknote issuance in China. European overseas banks had been under no obligation to disclose country-specific circulation volumes in their published annual reports, which allowed the British banks, whose banknote issues were truly multinational in nature, to withhold critical information, especially during politically sensitive times. HSBC's quasi-foreign note issue was likely to have been very remunerative, particularly in the late Imperial and early Republican eras. The Bank's Head Office in Hong Kong was generally less enthusiastic about the growth of the China issue than were local branch managers, due to concerns that an unbridled expansion of quasi-foreign note circulation volumes would impinge on HSBC's role as de facto arbiter of Hong Kong's money supply.