Interest Rates in History.

The article analyzes the political, social, technological and economic undercurrents that are influenced by the interest rates in history. Throughout history monetary loans have had characteristics that permit them to be classified in four types namely the long-term productive loans, short term working capital loans, non-productive or consumer loans and loans to governments. The rates of interest have in all times been both dependent upon and inseparable from the instruments of credit and the market methods in use at the time. According to the article, the near universal decline in long-term interest rates that occurred throughout Europe during the course of the 19th century was due to the stable political environment, to improvements in market methods, to the extension of trade under peaceful conditions and to the minimal demands of governments for military financing. In areas far removed from the major financial centers and money markets credit dealings become purely individual, and are unaffected by far off market forces.