I read an excellent article by Byron King (he writes the “Whiskey and Gunpowder” Financial Newsletter) about bankruptcy. In it he discusses the differences between insolvency (not being able to pay your debts) and bankruptcy, which is a legal workout between debtors and creditors. He also discusses the history of bankruptcy from the Roman times…

“The concept of bankruptcy is quite old. The word itself comes from two Latin words, bancus and ruptus. In ancient Rome, the bancus was a tradesman’s counter, across which almost all transactions were conducted and money was exchanged, not unlike the merchant’s counter today (except without the cash register). You can see old banci in, for example, the ruins of Pompeii, preserved for almost two millennia beneath the ash of the Vesuvius eruption of A.D. 79. And the word ruptus means “broken.” So literally, bancus ruptus translates as the breaking of a tradesman’s counter.” Taken from an article written for the Daily Reckoning.

I love this kind of stuff. Very interesting from a historical standpoint, but scary in light of the report he cites in which the researchers claim the US Government is, or will be soon, insolvent.