10 Fascinating Economic Collapses Through History

Since 2008 the United States has been in economic trouble. The current debate over the “fiscal cliff” has placed this economic distress and its origins back on the public radar. In retrospect, the origins of the housing bubble and Wall Street meltdown seem inevitable.

There have been numerous financial meltdowns in the past that have their origins in even more bizarre and obviously flawed schemes. From ancient times to the present we seem to fall for economic schemes and the disasters that often result. This list takes a look, in chronological order, at some of the most intriguing economic collapses of history. We can feel a little better about our current situation as we consider the mistakes of our ancestors.

(1) Diocletian Destroys Rome’s Economy: The Roman Empire was in decay when Diocletian became emperor in the fourth century. The economy was in disarray from a series of costly wars and previous emperor’s building projects that left Rome near collapse. With Rome’s currency worthless, Diocletian introduced a new system of coinage. At many times in history countries have risked economic turmoil to artificially increase the value of their currency. The issue with Diocletian’s new money, however, was that it did the opposite. There was more gold in the coins than the face value stamped on them; the denomination on the coin lowered its value. In response to this insane idea most citizens melted the coins to make use of their higher scrap value. The result was rapid inflation within the Empire. Diocletian increased problems by placing a price ceiling on most goods to counter the inflation.
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