Money with a holding fee existed in ancient Egypt for over 1,500 years. Egypt had storehouses of grain run by the state. Grain was the primary food source for the Egyptians. When farmers came with their harvest, they would get a receipt telling how much they brought in and on what date. A baker could return the receipt and exchange it for grain after paying for the storage cost and loss due to degradation.

The origins of the grain storage remain unclear. The government collected taxes in kind, thus a portion of the harvest, and had to store it. The government storage probably proved convenient for farmers as they didn’t have to keep and sell their grain, which was a significant convenience. And it made sense to have a public grain reserve in case the harvests failed.

The Egyptians used these receipts as money, as grain was a commodity everyone needed. Because of the storage costs, the receipts gradually lost value. With this kind of money, you might have interest-free loans. Someone in possession of this money who likes to save it will lose by storing it and can keep his capital intact by lending it without interest. There is no evidence that this happened.

The grain storage relates to a story in the Bible. It is fiction but might tie money with a holding fee to the Abrahamic religions. As the story goes, the Pharaoh had dreams his advisers couldn’t explain. He dreamt about seven lean cows eating seven fat cows and seven thin and blasted ears of grain devouring seven full ears of grain.

Joseph explained those dreams to the Pharaoh. He told the Pharaoh that seven years with good harvests would come, followed by seven years with crop failures. He advised the Egyptians to store food. They followed his advice and built storehouses for grain. In this way, Egypt survived the seven years of scarcity (Genesis 41):

When two full years had passed, Pharaoh had a dream: He was standing by the Nile when out of the river, there came up seven cows, sleek and fat, and they grazed among the reeds. After them, seven other cows, ugly and gaunt, came up out of the Nile and stood beside those on the riverbank. And the cows that were ugly and gaunt ate up the seven sleek, fat cows. Then Pharaoh woke up.

He fell asleep again and had a second dream: Seven heads of grain, healthy and good, were growing on a single stalk. After them, seven other heads of grain sprouted–thin and scorched by the east wind. The thin heads of grain swallowed up the seven healthy, full heads. Then Pharaoh woke up; it had been a dream.

In the morning, his mind was troubled, so he sent for all the magicians and wise men of Egypt. Pharaoh told them his dreams, but no one could interpret them for him. Then, the chief cupbearer said to Pharaoh, ‘Today I am reminded of my shortcomings. Pharaoh was once angry with his servants, and he imprisoned me and the chief baker in the house of the captain of the guard.

Each of us had a dream the same night, and each dream had a meaning of its own. Now, a young Hebrew was there with us, a servant of the captain of the guard. We told him our dreams, and he interpreted them for us, giving each man the interpretation of his dream. And things turned out exactly as he interpreted them to us: I was restored to my position, and the other man was hanged.’

So Pharaoh sent for Joseph, and he was quickly brought from the dungeon. When he had shaved and changed his clothes, he came before Pharaoh. Pharaoh told Joseph, ‘I had a dream, and no one can interpret it. But I have heard it said of you that when you hear a dream you can interpret it.’ ‘I cannot do it,’ Joseph replied to Pharaoh, ‘but God will give Pharaoh the answer he desires.’

Then Pharaoh said to Joseph, ‘In my dream, I was standing on the bank of the Nile, when out of the river there came up seven cows, fat and sleek, and they grazed among the reeds. After them, seven other cows came up–scrawny and very ugly and lean. I had never seen such ugly cows in all the land of Egypt. The lean, ugly cows ate up the seven fat cows that came up first. But even after they ate them, no one could tell they had done so; they looked just as ugly as before. Then I woke up.

‘In my dreams I also saw seven heads of grain, full and good, growing on a single stalk. After them, seven other heads sprouted–withered and thin and scorched by the east wind. The thin heads of grain swallowed up the seven good heads. I told this to the magicians, but none could explain it to me.’

Then Joseph said to Pharaoh, ‘The dreams of Pharaoh are one and the same. God has revealed to Pharaoh what he is about to do. The seven good cows are seven years old, and the seven good heads of grain are seven years old; it is one and the same dream. The seven lean, ugly cows that came up afterwards are seven years old, and so are the seven worthless heads of grain scorched by the east wind: They are seven years of famine.

‘It is just as I said to Pharaoh: God has shown Pharaoh what he is about to do. Seven years of great abundance are coming throughout Egypt, but seven years of famine will follow them. Then, all the abundance in Egypt will be forgotten, and the famine will ravage the land. The abundance in the land will not be remembered, because the famine that follows it will be so severe.

The reason the dream was given to Pharaoh in two forms is that the matter has been firmly decided by God, and God will do it soon. ‘And now let Pharaoh look for a discerning and wise man and put him in charge of the land of Egypt.

Let Pharaoh appoint commissioners over the land to take a fifth of the harvest of Egypt during the seven years of abundance. They should collect all the food of these good years that are coming and store up the grain under the authority of Pharaoh to be kept in the cities for food. This food should be held in reserve for the country, to be used during the seven years of famine that will come upon Egypt, so that the country may not be ruined by the famine.’

The plan seemed good to Pharaoh and to all his officials. So Pharaoh asked them, ‘Can we find anyone like this man, one in whom is the spirit of God?’ Then Pharaoh said to Joseph, ‘Since God has made all this known to you, there is no one so discerning and wise as you. You shall be in charge of my palace, and all my people are to submit to your orders. Only with respect to the throne will I be greater than you.’ So Pharaoh said to Joseph, ‘I hereby put you in charge of the whole land of Egypt.’

During the seven years of abundance, the land produced plentifully. Joseph collected all the food produced in those seven years of abundance in Egypt and stored it in the cities. In each city, he put the food grown in the fields surrounding it. Joseph stored up huge quantities of grain, like the sand of the sea; it was so much that he stopped keeping records because it was beyond measure.

The seven years of abundance in Egypt came to an end, and the seven years of famine began, just as Joseph had said. There was a famine in all the other lands, but in the whole land of Egypt, there was food. When all of Egypt began to feel the famine, the people cried to Pharaoh for food. Then Pharaoh told all the Egyptians, ‘Go to Joseph and do what he tells you.’

When the famine had spread over the whole country, Joseph opened these storehouses and sold grain to the Egyptians, for the famine was severe throughout Egypt. All the countries came to Egypt to buy grain from Joseph because the famine was severe in the whole world.

The story further tells how the Egyptians became the serfs of the Pharaoh (Genesis 47):

There was no food in the whole region because the famine was severe. Both Egypt and Canaan wasted away because of the famine. Joseph collected all the money found in Egypt and Canaan as payment for the grain they were buying and brought it to Pharaoh’s palace.

When the money of the people of Egypt and Canaan was gone, all of Egypt came to Joseph and said, ‘Give us food. Why should we die before your eyes? Our money is used up.’ ‘Then bring your livestock,’ said Joseph. ‘I will sell you food in exchange for your livestock since your money is gone.’

So they brought their livestock to Joseph, and he gave them food in exchange for their horses, their sheep and goats, their cattle and donkeys. And he helped them through that year with food in exchange for all their livestock.

When that year was over, they came to him the following year and said, ‘We cannot hide from our lord that since our money is gone and our livestock belongs to you, there is nothing left for our lord except our bodies and our land.

Why should we perish before your eyes–we and our land as well? Buy us and our land in exchange for food, and we, with our land, will be in bondage to Pharaoh. Give us seed so we may live and not die, and the land may not become desolate.’

So Joseph bought all the land in Egypt for Pharaoh. The Egyptians, one and all, sold their fields because the famine was too severe for them. The land became Pharaoh’s, and Joseph reduced the people to servitude from one end of Egypt to the other.

Joseph told the people, ‘Now that I have bought you and your land today for Pharaoh, here is seed for you so you can plant the ground. But when the crop comes in, give a fifth of it to Pharaoh. The other four-fifths you may keep as seed for the fields and as food for yourselves and your households and your children.’

‘You have saved our lives,’ they said. ‘May we find favor in the eyes of our lord; we will be in bondage to Pharaoh.’ So Joseph established it as a law concerning land in Egypt -still in force today- that a fifth of the produce belongs to Pharaoh.

A settlement of storage costs took place when someone brought in the receipts. The receipts gradually lost value over time to cover the storage cost. It was similar to buying stamps to keep the money valid, like in Wörgl. The grain money remained in circulation after the introduction of coins around 400 BC until the Romans conquered Egypt around 40 BC. The grain money survived for over 1,500 years. It was not a financial crisis that ended it, but the Roman conquest. It suggests a holding fee on money or negative interest rates can be the basis of a stable financial system that lasts for eternity.

Finally, there is a wisdom that we can easily overlook. Storing food makes more sense than saving money, even when you make losses on the storage. Today, the weather grows increasingly unpredictable due to global warming, so massive harvest failures become increasingly likely. Storing food makes more sense than ever in a time when people cling to money more than ever, and there is only enough food in storage to feed humanity for a few months. It doesn’t require a rocket scientist to figure that Joseph’s advice to the Pharaoh to store food for meagre times makes more sense than ever.

Latest revision: 13 January 2024

Featured image: Joseph interpreting the Pharaoh’s dream. Illustrations for La Grande Bible de Tours. Gustave Doré (1866). Public Domain.