The History Of Investing (And Why You’re Not Rich)

Athena Alpha

You’re not imagining it, the absurd wealth inequality in the world is actually getting worse.

Inflation certainly isn’t helping and virtually everyone (including us!) is financially stressed and tired of how corrupt and unfair everything is. Even after being exposed multiple times already via fantastic work like the Panama Papers, there still hasn’t been any significant consequences for the rich.

But how did all these rich people, specifically the “old money” wealth, get rich in the first place? Through investing. What you’ll never hear the experts talk about though is just how much of a walled garden investing is. While they’d like you to believe that “anythings possible!” it’s simply not true when you look at the history of investing.

At least, not in the legacy financial world.

The Privileged History Of Investing

Investing has existed for centuries dating back as far as the Venetians in the 1300’s and at every turn only the privileged have been allowed. They’d carry slates around with information on the various issues for sale and meet with clients, similar to what stock brokers do today.

In the 1600’s wealthy individuals would create agreements with sailors similar to how modern limited liability companies (LLC) work today. These agreements would invest in voyages that brought lucrative goods back from India and share the profits. Diversification also existed back then too as they’d invest in several different ships at the same time in case some of them got rekt… literally!

From this humble beginning, these types of investments limited who could participate because you just had to physically be in the same location back then in order to take part. As such, anyone living outside the main shipping hubs or not in Venice was out of luck. Secondly, you had to already be privileged enough to have considerable wealth to participate. This was because you couldn’t chop a big investment up into thousands of little pieces like you can today.

For example, a voyage to India to bring back precious cargo might only have 2-3 investors. So even if you’re only investing one third of the total costs, this still ends up being a pretty big amount. As such, investing was exclusively restricted to those top elites that already had considerable wealth on hand, not to mention were in the right place at the right time with the right connections.

Investing For Me, Poverty For Thee

Over time, these shipping companies grew in size and eventually started issuing stocks. Rather than investing in one or two individual voyages, you could now invest in something like the East India Company and it’d pay out dividends from the profits of all of their voyages. As time went on, these stocks (basically fancy bits of paper) ended up getting traded between other investors.

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