If you split a wooden stick lengthwise, you get two parts that fit perfectly with each other, and it will not be possible to split another stick and make it fit with the first. This principle has been used since ancient times as an ingenious way to document not least financial transactions, e.g. loans.
The use of the technique was widespread in Europe in the Middle Ages and lasted until the beginning of the 1800s, and ancient examples have also been found elsewhere, such as in China.
The stocks in possession of the lenders were considered a bearer of value, precisely because they were proof of a claim, and in 12th-century England it went so far that the king accepted them as a tax payment. So the stocks became currency, and there was a “stock market” emerging.
But then people gradually switched to other paper based techniques, because they were easier to handle, and the sticks gradually went out of use. The grand finale can be said to be the great parliamentary fire in London in 1834. By then the use of tallies had been officially made illegal a few years before, and teh Exchequer (the official treasury of England) had large quantities of tallies they chose to burn up. But the fires became too violent so the whole Parliament burned down. See wikipedia.
About the survey work and references
The purpose of the project is not to be a history dissemination work, but to create a basis in theory and practice for a sustainability oriented financing company though the project Bi-O Stocks. The representation above should in general be correct, and those who want to go deeper into the material can start with the following sources. Please get in touch if you find more interesting sources, disagree with anything in the representation or whatever.
- Grandell, Axel: Karvstocken (1982) (swedish only) (copyrighted, so cannot publish here yet)
- Grandell, Axel: Artikkel i RIG (1985) (swedish only)
- Grandell, Axel: Artikkel i Fornvännen (1986) (swedish only)
- Swedish Wikipedia on the economist Axel Grandell (1899-1993) An expert on the history of accounting.
- George Dyson: Economic dis-equilibrium
- The Gowe Initiative for Modern Money Studies: A history lost – The English Tally
- Valens Research: This ancient tradition is the reason we ‘long’ and ‘short’ stocks today
- Mathematical Assosiation Of America: Mathematical Treasures – English tally sticks
- Computer History Museum: Roman philosopher pliny describes tally sticks
- Artikkel på Researchgate
Idea and execution of Bi-O Stocks: Karl Aakerro 47 29 92 95 or use this form here
Photo on top: nationalarchives.gov.uk