Friday, October 26, 2012

The Fall of Babylon and the Babylonian Unit of Account


I was skimming a paper linked to in Tom's Bookstaber thread below and came across a reference to this document that analyses some archaeological records from ancient Babylon.

The purpose of the paper was to analyse price patterns exhibited by certain commodities [Ed: sigh...] but perhaps more interesting to MNE readers may be what it reveals about the unit of account or "money" or monetary system that Babylon was using during the period under investigation (652 BC forward).
Archaeological excavations started in 1899 by Robert Koldewey have uncovered astronomical diaries, written in cuneiform on clay tablets, from the period 652 B.C. to 69 A.D. Since the tablets contain celestial observations, all information inscribed on them is dated, including records of the weather, the level of the Euphrates River, socio-political events and market quotations of six commodities: barley, dates, mustard (cascuta), cress (cardamom), sesame and wool. The commodity prices are expressed in weight quantities that could be purchased per shekel of silver, recorded three times a month.
The Babylonians were using weight measures of the "Noble Metal" silver, as their unit of account and apparently as their "money" or coins or their physical unit of exchange. The unit being the "shekel"  a weight measure that is popularly thought to have been based on the weight of a certain number of grains of barley mandated by some governmental authority.

This monetary arrangement itself looks like it was a key factor in the downfall of Babylon, as the Prophet Isaiah wrote:
17 Behold Me rousing against them the Medes, who are not accounting silver, And gold - they are not delighting in it.   (Isaiah 13:17)
Here, we can see from Isaiah's account that Babylon's use of weight measures of silver became a relative disadvantage to them versus apparently a different approach used by the Medes; and ultimately took them down.

The monetary systems we humans design and use to facilitate and account for exchange between ourselves are perhaps the most important aspects of our economic policies we are authorized to implement.

Looking back now at the 20th century, we can see that there for sure was a lot of economic development and of course the historic high levels of destruction. But one thing we should not overlook here in the west is that we somehow became able to throw off the yoke of these so-called "precious" metals, weight measures of which were for centuries used as our medium of exchange between ourselves.

FDR and Richard Nixon, two US Presidents delivering a knockdown left-right combination to the head across several decades against these metals. Metals that somehow continuously seek to establish themselves as a chaos inducing medium of exchange between we humans.... have we reached the ten count yet I wonder.

14 comments:

Bob Roddis said...

It is telling that you clowns worship war-mongering mass killers like FDR and Nixon. The noted mass destruction of the 20th Century was made possible by your beloved funny money because the populace would have never agreed to pay for those wars in real time using sound money. You fiat money lovers have blood on your hands and all the way up to your armpits.

Bob Roddis said...

Due to your love of the mass murdering FDR and Nixon, I suggest a new logo for MMT:

http://www.fas.org/nuke/guide/usa/bomber/b52-bomb.jpg

Matt Franko said...

Bob,

Consider that the wars wouldnt have been thought necessary to fight in the first place if it wasn't for metal-love to begin with....

rsp,

Matt Franko said...

PS And nobody here is worshiping these 2 dead humans.... rsp,

Bob Roddis said...

Consider that the wars wouldnt have been thought necessary to fight in the first place if it wasn't for metal-love to begin with....

What a preposterous and baseless assertion. You simply have nothing to offer in response to the obvious fact that with fiat funny money, nations are not revenue constrained from conducting mass slaughterfests as they would be and were under a regime of sound[er] money.

Matt Franko said...

Wasn't Germany driven into re-arming after WW1 because the Allies structured a gold-loving post war screw deal for them at Versailles?

Anonymous said...

Bob,

Inexpensive fiat is the ONLY ethical money form for government debts else some special interest is piggy-backing on the taxation authority and power of government. So "fiat gold" is an abomination to true libertarians. That said, government money should only* be legal tender for government debts (taxes and fees) not private ones though people could still choose to use fiat for private debts.

*After a universal bailout of the entire population with full legal tender fiat (Greenbacks) so that the banks shall be forced to accept it.

Unknown said...

Bob you're an idiot. Do you really think any countries would have stopped fighting during the second world war just because they ran out of gold?

You're an idiot, pure and simple.

Ignacio said...

Bob, humans have been slaughtering each others for centuries due to gold, what the hell are you talking about?

And no, neither "funny" or "sound" money has been never an issue to stop people killing each other. Hatred is the most powerful human motivator, and money will NEVER EVER get in the way.

Only when people grows tired of violence and blood and the beast is calmed down, the violence stop. Money never was, and never will be, a limitation to wars and violence.

As for little corporate-government welfare operations, they are exactly like business, as long as the potential profit outweighs the cost, they will be carried out; it doesn't matter if you are in a 'funny' or 'sound' money regime (lol idiotic adjectives).

Matt Franko said...

good point Ignacio, this archaeology corroborated by the Hebrew Scripture depicts Babylon the Great running a metal based system and then this putting them at a disadvantage that the Medeo-Persians took advantage of....

but then maybe the Persians were subsequently corrupted by these metals and then got their ass kicked by the Greeks and then the Greeks got their ass kicked by the Romans, etc...

I wonder if in each case, the nation that does the overthrowing builds up without a system using metals, then once they conquer the metal-lovers, these non-metal using victors then became corrupted by the metals that they get from the conquered, which made them vulnerable to getting their ass kicked in the first place....

even in the inter war period, Germany was having to regurgitate gold to the allies but was able to build up without using gold in their domestic economy to the point where they were able to go back and kick the allies ass at least for a while until the US got in where the US was off gold since 1933 and wasnt corrupted by the gold...

Pattern seems to be: use metals and your nation declines, reject gold and economically prosper... of course to what ends is still an open question.

Seems like a good practice to permanently reject the metals as far as use for accounting and medium of exchange...

rsp,

Unknown said...

"this putting them at a disadvantage that the Medeo-Persians took advantage of...."

Where does it say that?

Matt Franko said...

y,

"Behold Me rousing against them the Medes, who are not accounting silver, And gold - they are not delighting in it. "

"rousing" means like "rise up", against implies relativity. This implies (to me), that the Medes ability to be roused against Babylon was related to the Medes monetary system relative to the Babylonians...

rsp,



Matt Franko said...

This is from Adam(ak) in a comment at Warren's recent:

"Let’s look at this from evolutionary perspective. Fiat money was actually introduced to finance military expenditure. These states which are unable to finance military expenditure when it is needed would either be bullied or lose a war outright. Using a fiat monetary system gives a certain competitive advantage. Just imagine financing the American Civil War or WW2 within a commodity money system."

Adam seems to perhaps make the case that non-convertible currency systems (or at least ones that do not use metals) give (gave?) nations a competitive advantage against each other...

"survival of the fittest"/natural selection from an evolutionary perspective.... part of the operation of God from a scriptural perspective... rsp,

Tom Hickey said...

That argument is nonsense. Historically, when ruler wanted to go to war and resources were scarce, they just confiscated them.

The present system is just more subtle. The rulers whip the population into fear of the enemy so they willingly contribute their resources.

The idea that periodic wars coming to an end due to financial constraints is just bonkers. Totally unhistorical.