Where Did Credit and Debt Begin?
Credit and debt are not a new phenomenon. They have been around for thousands of years, the only difference is that the consequences were much harsher in the past.
The ideas of credit and debt were first formed when someone would lend cattle to a neighbor and would expect to repaid with more cattle, because there would be more cattle at the end of the term. From this stemmed the idea of interest, and soon people could undertake debt on their purchases.
In the old days, farmers would buy a piece of land and finance it. They would have to repay the land by working and harvesting the land, thus there was a strong motivation for the farmer to repay the debt. If a farmer was not able to repay this debt, then they would either have their land seized or would have to sell themselves into slavery. This was much more motivating for the debtors and they normally produced higher than a farmer who was not in debt. Wouldn’t you?
In today’s day and age, debt and credit are still prevalent. The repercussions from not paying a debt are no where near as harsh. The most punitive consequence of not paying a debt is that your credit score will suffer, which will prevent you from receiving other loans.
When speaking of debt, The United States always comes up, which has a national debt of almost 13 trillion dollars. The United States is run on debt, and this debt may be a ticking time bomb.
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