2006-12-03 17:31:01 · 6 answers · asked by ΛVΛ 1 in Social Science ➔ Economics
Compound interest was once regarded as the worst kind of usury, and was severely condemned by Roman law, as well as the common laws of many other countries. (Source: Wikipedia http://en.wikipedia.org/wiki/Compound_interest)
2006-12-05 00:38:07 · update #1
they are very different.
compound interest is the money you get for putting your money at a bank. theoretically speaking, you are NOT putting the money in the bank, but you are selling your money to the bank for X% for a certain time period. that X% is the interest. in turn the bank will turn around and sell your money to someone else for X% for a certain time in a form of a loan. banks are just buying and selling money
common theft is someone "borrowing" your money forcefully, without returning it
2006-12-04 03:57:01 · answer #1 · answered by Kev C 4 · 0⤊ 0⤋
The use of money is worth something.. If you want to open a store you must first buy the goods with cash and hold them until you sell and make a profit. If you manufacture the same cash first rule holds. If you buy a home so you longer pay rent and save the money you must have the cash or borrow. All compounding does is add the interest owed after some period to the loan. It makes little difference unless the loan is long term. Interest is not like theft unless the rate is unreasonable high. This is only the case for loans to desperate or foolish people who use credit cards for extra spending money and carry large balances.
2006-12-04 02:40:49 · answer #2 · answered by meg 7 · 0⤊ 0⤋
Compound Interest is interest that is earned on interest already earned. This occurs in saving accounts, etc. It is not "stealing" the bank (or other financial institute)'s money, because you are loaning them your money in the first place. They reinvest your money and make a greater amount of money than they give you. If you leave your interest in the bank, they use that money to make more money, too.
2006-12-04 01:51:00 · answer #3 · answered by Serving Jesus 6 · 0⤊ 0⤋
This is a stupid question. Theft means that someone forcibly takes money or an asset away from you without your consent. You never agreed to the "trade" and you would halt it if you could. You are deprived without compensation.
Borrowing means that someone else is nice enough to actually give you money for your use rather than take it away from you. There is a cost for that valuable service just as there is a cost for anything. When anyone is facing interest on a loan it is because they voluntarily chose to take that loan in the first place. No one coerced them into anything, and they receive something valuable in trade.
2006-12-04 11:24:09 · answer #4 · answered by KevinStud99 6 · 0⤊ 2⤋
The only difference I can think of is this :
Compound Interest is a legally approved loophole to 'rob' the poor. Because only the poor get into financial trouble.
Common Theft is an illegal method of robbing the rich.
There you go, enjoy to your heart's content.
2006-12-04 02:19:24 · answer #5 · answered by catcher 3 · 0⤊ 1⤋
Compound interest is interest generated upon interest already earned.
Common theft - I don't know what that is. But theft is stealing.
I don't understand the comparison.
2006-12-04 01:38:32 · answer #6 · answered by concernedjean 5 · 0⤊ 0⤋