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The Shifting Sands of Finance Lingo

Sam Vaknin, Ph.D. - 11/15/2008

In 1976, the word "subprime" used to mean: a loan offered to desirable, creditworthy clients with its interest rate set below the prime rate. Within less than 15 years it came to be defined by this arbiter of proper usage, the Oxford English Dictionary, as: "Of or designating a loan, typically having relatively unfavorable terms, made to a borrower who does not qualify for other loans because of a poor credit history. "

But, this is far from being the most startling transformation in the field of finance. The word "bank" is derived from the old Italian word "banca": a bench or a counter. Italian "bankers" (money dealers) used to conduct their business on such implements. Hence the word "bankrupt" ("banca rotta", or "broken bench", which is what irate clients did to the furniture of bankers who did not honor their commitments).

Fittingly, the word "broker" comes from the hedonistic French bon mot "brokiere", someone who opens bottles of wine (and then consumes their content - usually, at their clients' expense, needless to add).

The origins of the ponderous word "budget" are no more venerable: French tradesmen during the Middle Ages carried their money in a bouge (diminutive: bougette), a leather bag or knapsack. Later, the word came to signify the contents of the bougette. In the 18th century, Britain's Chancellor of the Exchequer (minister of finance) would present his annual statement and, thus, "open his bougette (budget)".

Finance is a field of human endeavor replete with conflict and murky dealings. Consider the origins of the ubiquitous word "negotiate". It literally means "not to be at ease" or "not be done at leisure". The Romans also gave us "bills". Official documents were sealed with a wax bubble called "bulla". Later, the very documents thus stamped acquired the name "bulla" or "billa". Hence "bill".