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interdict and no one was allowed to enter until the body of the _ store of gold and issued a paper to that effect. The paper bore the offender was removed and disposed of elsewhere. stamp and guarantee of the bank. The gold belonged to whoever Lawyers were not only forbidden to draw up usurious contracts, Presented the paper. Few people will carry around five pounds of but they were also forbidden to defend usurers. Clement V at the _ Silver coins or two pounds of gold coins in their pocket when a Council of Vienna in 1311 and 1312 declared that any public offi- Piece of paper which is light and portable will serve the same pur- cial, whoever he was and whatever rank he held, was to beexcom- pose. Of course, the peasants always wanted their one or two municated if he had anything to do with drawing up a law com- Coins in hand instead of a piece of paper. They still do. Since pelling debtors to pay usury, or denying them the right to recover _ ‘interest’ was not present, there was no compelling reason to issue usury. Any such law drawn up was decreed to have no force since more gold certificates’ than there was gold reserve. It was to it was in violation of the law of God. everyone's advantage to keep the system honest. The Council of Vienna affirmed the law that those who pro- In addition to gold deposit receipts there were other kinds of claimed that usury was not sinful were to be punished as heretics, large denomination money. It might take the form of a deed to a The decree was not only against usurers, but against anyone who —_house, a business, a ship or some other sort of debt-free equity encouraged the practice of usury by stating that it was not a sin which had an accepted value in the market place. To make this against God, —_ — re pee om : ee — ree by The basic Church teaching was that anyone who paid usury @ bank that had investigated and found that this boat or that house could seek restitution. aeney could ane demand the return WS indeed worth so much money on a certain day and, in public f usury. Not only is the usury not owed, but the usurer could not recognition of that fact, attached their seal for a small fee: This ant or keep it me committing sin. deed was used as paper money and had worth. It was not a mere The most interesting thing about these opinions is that the ‘Promise to pay’. } Church forbade usury simply because it was forbidden by the BUYING JOINT VENTURE Bible” So far as I have been able to ascertain, there was no real If aman wanted to buy a boat to go into the fishing business and understanding of the economic benefits that accrue to a society gign't have the necessary money but had a good deal of experi- that is free from the usury contract—such as the absence of wild ence, chances are he could work out a deal. He would go toa economic booms and devastating col- bank and ask for money, say 500 pounds. lapacs, lraderapician, mat teaeraploy- Upon establishing the fact that he had 20 ment. It does show the spiritual maturity years’ experience, the bankers might risk of our grandfathers who, without know- : : some of their investors’ money with him. ing the reason for prohibition of usury, — The wife of a usurer had nO — The bank would buy the boat and hire and profited mightily in doing so. right to anything that he might pA pps a tet Usury almost completely disappeared ive her. option to buy 10% of the business. If he from the Christian West. * : took up the option he would then own THE RENAISSANCE It was considered better that 10% of the business and get 10% of the - a she leave him and be bread profits. The bank would get 90% for The universal prohibition of interest 8 their investors. The second year he might unleashed the mighty Western than for her to receive support buy another 10%. He would then own Renaissance. Usury had acted as a rope 20% of the business and get 20% of the which had been strangling the West. As from her husband. ae If the bank ieee he was doing soon as it was banned, the West broke a poor job, they might fire him and hire forth into a flowering which could not another captain. He would still get 20% have been imagined earlier. Italian onan of the profits since he owned 20% of the merchants became wealthy enough to boat. If the boat sank, insurance covered it. The bank got a fee travel to China with their goods. Spanish and Portuguese explor- for its services, That's all. Nota large fee either. ers were financed and uncovered continents with which to trade. Money for the development of inventions became available. The Michelangelos, Rembrandts, Shakespeares, and Newtons were supported by the growing wealth of the West, and they did their thing—and made it profitable. This was an era free of interest! Tallies were a very important part of the economic system of the Middle Ages. Anyone who had the power could issue them. The Hanseatic League was a confederation made up of scores of inde- pendent German cities. They had the power to issue tallies and they did. So did virtually every county and large city in Europe. The hard pocket money was gold and silver coins. Many of these coins were in poor condition, being wom, clipped, and some counterfeited. This seemed to make as little difference then as it did in Roman days. People cheerfully accepted them in payment for goods and services. Why not? The government accepted a clipped coin as readily as a full-weight coin for taxes. Not so the foreign merchants. When they made a transaction, they wanted payment in full-weight gold coins. Thus we have two kinds of coins—'discount coins’ for the citizens and ‘trade coins’ for the merchants. Another way to handle the same boat contract was on a ‘rental’ basis. The bank's investors would buy the boat and ‘rent’ it to the buyer. The buyer kept all the profits and paid rent to investors. There might be an option to ‘buy’ the boat. The type of contract which could be drawn was limited only by the imagination. One thing—it had to be fair! No one will go into a contract which doesn't seem fair to both sides—especially if the deal is being watched by the Christian community. In the way illustrated above, in ten years the buyer could own his own ship without having to put up any money of his own. Of course, the ten-year contract is given only as illustration. Practically there were no such contracts that went past seven years, "At the end of every seven years thou shall make a release (can- cellation of debts). And this is the manner of the release: Every creditor that lendeth ought unto his neighbour shall release it (can- cel the debt); he shall not exact it of his neighbour, or of his broth- er, because it is called the Lord's release. Of a foreigner (Heb.: zitwr—"racial alien") thou mayest exact it again but that which is thine with thy brother thine hand shall release." (Deut.: 15:1-3.) store of gold and issued a paper to that effect. The paper bore the stamp and guarantee of the bank. The gold belonged to whoever presented the paper. Few people will carry around five pounds of silver coins or two pounds of gold coins in their pocket when a piece of paper which is light and portable will serve the same pur- pose. Of course, the peasants always wanted their one or two coins in hand instead of a piece of paper. They still do. Since ‘interest’ was not present, there was no compelling reason to issue more ‘gold certificates’ than there was gold reserve. It was to everyone's advantage to keep the system honest. In addition to gold deposit receipts there were other kinds of large denomination money. It might take the form of a deed to a house, a business, a ship or some other sort of debt-free equity which had an accepted value in the market place. To make this’ ‘paper money’ more readily acceptable, it was often guaranteed by a bank that had investigated and found that this boat or that house was indeed worth so much money on a certain day and, in public recognition of that fact, attached their seal for a small fee: This deed was used as paper money and had worth. It was not a mere ‘promise to pay’. years, "At the end of every seven years thou shall make a release (can- cellation of debts). And this is the manner of the release: Every creditor that lendeth ought unto his neighbour shall release it (can- cel the debt); he shall not exact it of his neighbour, or of his broth- er, because it is called the Lord's release. Of a foreigner (Heb.: zitwr—"racial alien") thou mayest exact it again but that which is thine with thy brother thine hand shall release." (Deut.: 15:1-3.) UY WAU LLY UE VUYL ULERY IGG DILGLE AMIWEDY. UE Ly Paper money of large denomination was simply a gold deposit receipt. A bank had, in the manner of the Templars, taken in a Con d on page 75 20¢NEXUS BUYING JOINT VENTURE THE RENAISSANCE OCTOBER - NOVEMBER 1993