Banking theory (Was Re: Galleons, Sickles, and Knuts)

[grey_wolf_c]

No: HPFGUIDX 35011

--- In HPforGrownups at y..., "uncmark" <uncmark at y...> wrote:
> In Book 1, Hagrid explains Wizard Money to Harry as follows, "The 
> gold ones are Galleons. Seventeen silver Sickles to a Galleon and 
> twenty-nine Knuts to a Sickle, it's easy enough." 
> 
> JKR has stated that she estimates the value of one Galleon to 
> be "about five pounds." According to the Harry Potter Lexixon, a gold 
> Galleon works out to US $7.33, a silver Sickle to around 43 cents and 
> a Knut about a penny.
> 
> I can accept a bronze penny and a silver 43-cent coin (probably 
> silver clad or colored like a quarter or half-dollar) but a gold coin 
> worth $7? At present a 1/10 oz gold coin, barely the size of a nickel 
> sells for $45. Is a Galleon the size of a dime? Or is it gold clad 
> like the Sacajawea dollar?

I always assumed that "gold coins" are adultered in some way (maybe 
electron: silver and gold), or maybe even just golden, with the real 
value stablished by the goverment at more than their intrinsic value 
and less than their fabrication cost (basically, like in the muggle 
world)

> Galleons would have to be worth more if only for the fact that in 
> Chamber of Secrets the Weasleys buy the entire school supplies for 4 
> students for "a very small pile of sickles and just one gold galleon."
> 
> Opinions?
> 
> Uncmark

I've got a theory of my own about banking in the wizard world which 
sort of explains this. It's a bit long, so just bear with it, the 
answer is at the end.

Banking in the middle ages (which is the basic world wizards live in) 
was in its infancy. It was invented by a combination of Jew's ancient 
interest in money and the Christian substitute for it (since it was 
inmoral for a Christian to lend money if planning to get back more than 
they lended). Templars are involved here, but since I've already been 
shouted at this week for OT-ing in the list, I'll let it at that 
(e-mail me for the full story, if you want it). Whatever the reasons, 
banking in the middle ages was mainly for safe-keeping, at a rate (they 
took some of your money in exchange for keeping it safe). This could 
still be in place, for all we know, which would not encourage people to 
keep their money in the gringotts bank (why this is important will be 
seen at the end).

On the other hand, we can also assume that Gringotts works like a 
modern bank. It still presents quite a lot of problems: it seems it 
only has one building (Sirius had to got to Diagon alley to get money 
for Harry's broom), and even assuming it was because his vault was in 
London, it's a very ackward situation (and more than a bit dangerous, 
him being persecuted by justice and all). On the same lines, there is 
no such thing as an ATM (I hope that means the machine that give's you 
your money when you insert your credit card), thus Harry had to take 
money for the whole year at Hogwarts, and the Weasleys had to go to 
London to get their money.

Now for the interesting part: wages. There is no indication about how 
people are paid in the wizard world, but I've lately had the feeling 
that you're not paid monthly into your bank account, but (as was the 
norm in the middle ages), weekly and "on hand", or even dayly.

OK, by now I've probably bored you to death with my ramblings, but 
we're getting to the explanation. Assuming my bank thery (above) is 
correct, it can be deduced that most wizard families (specially the 
ones, like the Weasleys, who live far from their Grngotts vaults) only 
take their money to the bank when it's starting to pile up, since it is 
by no means easy or fast to do it regularly. We know that the money in 
the Weasleys case DOES NOT pile up, so they have very little in the 
bank. The family must save during the whole year to have enough to pay 
for the students's materials, and they carry most of that money with 
them when they go to the Diagon alley. When they arrive, they get 
whatever is in the vault and put it with the rest they've carried from 
home. SO, the Weasleys' fortne in PS is NOT 1 galleon  and some loose 
change, it's quite a bit more, but they just didn't take it to the bank 
(because that means driving all the way to London, or using Floo powder 
which is also exoensive), when they can just hide what little Arthur 
gets from the MoM (hopefully someplace safe from the twins).

Hope that helps,

Grey Wolf