"The image of profit-seeking banks continually evaluating the creditworthiness of the states to whom they lend capital is a familiar one, frequently assumed to be as true now as it was three hundred years ago. Against this view, Sovereigns and the Masters of Capital argues that this description only corresponds to the last forty years, at best. The systematic assessment of sovereign borrowers with quantifiable data by exclusively profit-driven banks began in the early twentieth century among a restricted group of financiers ...
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"The image of profit-seeking banks continually evaluating the creditworthiness of the states to whom they lend capital is a familiar one, frequently assumed to be as true now as it was three hundred years ago. Against this view, Sovereigns and the Masters of Capital argues that this description only corresponds to the last forty years, at best. The systematic assessment of sovereign borrowers with quantifiable data by exclusively profit-driven banks began in the early twentieth century among a restricted group of financiers. But it took until the 1970s, at the earliest, for this new approach to become dominant among lenders. Throughout the nineteenth century and until the interwar period, old merchant banking families dominated the business of sovereign lending--the practice of lending capital to sovereigns--pursuing both profit and status, and relying on personal relations rather than on statistical information, even as it became widespread and easily accessible. This only began to change with the rise of joint-stock banks, exclusively profit-driven lenders that lacked merchant bankers' connections and relied heavily on rankings based on statistical data to assess sovereign borrowers. By identifying and explaining this profound shift in terms of who sovereign lenders have been and how they have thought about the sovereigns to whom they lend capital, this book sheds new light on the peculiarity of our own time and provides a novel interpretation of the changing relationship between states and financial markets over the last two centuries"--
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