Stories and moral of The richest man in Babylon (finance classic)

The richest man in Babylon is for those who find economics lessons difficult to learn. This book consists of economics lessons with stories. That is why this book is very easy to understand.

The richest man in Babylon was written in 1926 by George Clason.

Richest man in Babylon principles of investing 90-10. 7 cures for a lean purse.  Opportunity brings good luck. Moral in the richest man in Babylon.

The Story of Algamish and Arkad

Arkad was scribe labour. Algamish was a money lender. One day Algamish came to Arkad and offered him a scribe work. Meanwhile, Arkad asked him the secret of his wealth. Algamish replied,

Part of all I earned was mine to keep.

Whatever I earn I save 10% of it.

Each gold coin you save is a slave for you. The gold coin (slave) would earn copper for you, which are its children. These children will also work and earn for you.

Arkad obeyed the advice. He decided to save and invest 10% of his income regularly.

Initially, he invested over Azmur, the brick maker. Azmur wanted to start the business of Phoenician jewels. Due to lack of knowledge about jewels, Azmur was tricked and Arkad's money went with it.

Arkad grew more cautious in investing. He started investing again. This time he invested over Agger, the shield maker, to buy bronze which had to be used in making shields.

Money started making more money for Arkad.

Algamish met Arkad again. He asked him to go and manage his lands in Nippur, a village nearby. Arkad agreed. When he returned from Nippur, he got his share. Now, Arkad was the richest man in Babylon.

Moral of this story:

  • When you set a task for yourself you should complete it. Investments done at regular intervals is better than total investment done after a long time.
  • Wealth grows wherever men exert energy

Arkad as a Teacher

Arkad was entrusted to teach the secrets of wealth to 100 men. Arkad taught them the 7 cures for a lean purse.

  1. You can use 90% of your wealth to buy jewels, a bit of finery, more food. But you should save at least 10% of your earnings and invest it in Gold, lands or merchandise.
  2. Budgeting: to control your unnecessary expenses on all desires according to 90-10 principle
  3. Put your savings to work that make you more money: 10% savings should be invested with great caution. You can also deposit some money into Life insurance. A small return and a safe one is far more desirable than risk. 
  4. Guard your treasure against loss. You can relate to the wrong investment made over Azmur, the brickmaker
  5. Own your own home. Invest from the 90% to buy a home.
  6. Insure a future income, that is, insurance
  7. Increase your ability to earn by gaining wisdom in your calling. For example, a merchant should always try to find better goods at lesser costs.

How to lead a respectful life?

  1. Pay debts with all the promptness within your power. Not purchasing that for which you are unable to pay
  2. Must take care of your family that take care of you. Make a will for fair distribution of your assets
  3. Have compassion upon those who are in need, and, aid them with reasonable limits.

Goddess of good luck.

Goddess of good luck is achievable, not in gambling, but, when an opportunity knocks on your door, do not procrastinate to open it and, grab it.

Opportunity brings good luck. The story of camel merchant and sheep master is given. Camel merchant loses a deal, as he took too long to realize the opportunity.

The five laws of gold

Kalabab used to tell the tale of Nomasir, the son of Arkad.

Once Arkad decided to depart his son Nomasir with one bag of gold and a clay tablet carved five laws.

Nomasir spent 10 years in Nineveh. He had lost all his wealth in a deceitful horse race and a partnership.

Had Nomasir return to Babylon all lost, he would not be heir to Arkad's estate.

But, five laws on the clay tablet saved him:

  1. 10% savings
  2. Investing in the hope of getting a return on investment
  3. Decide whom to take guidance from
  4. Don't invest in what you don't understand
  5. Don't invest in getting rich quick schemes.

Next, Nomasir found employment in managing slaves working to build the outer walls of the city. He saved a copper, that is, the 10%, and, made it silver over time by saving more.

Another slave master (a friend) told Nomasir about the bronze gates which will be built after one year.

"We send a caravan for mining copper with our savings and bring the metal to Nineveh. We will become the only supplier of copper in the whole city and subsequently become rich."

Nomasir liked the idea. He got associated with other investors, and invested.

He returned to Babylon with three bags of gold. One bag to return to his father. And, other 2 bags that he earned because of the scribed wisdom.

The gold lender of Babylon

Rodan got 50 pieces of gold as a gift from the king. He was the spear maker of Babylon.

He went to Mathon, the gold lender to seek advice about investment. He told Mathon about the king's gift of 50 gold coins.

There was a difficulty. It is difficult to say no to his sister who wants her husband (Araman) to become a big merchant. So she wants Rodan to loan him his gold.

Mathon told Rodan the story of ox, donkey and the farmer of Nineveh, who could understand the language of animals.

The moral of the story was to help a friend in a way that will not bring your friend's burdens upon you.

Mathon laid before the tokens of borrowers from his token chest. He recommended Rodan to take collateral in the form of gold, property or cattle. Check if the borrower has a constant source of income.

Some people that Mathon lent, had nothing as collateral but were recommended by good friends of his.

Stories behind the Mathon's tokens:

Token 1: bronze neckpiece and scarlet cloth. His friend had a wife and he had spent all his gold to his wife's desire. He came to Mathon in despair. Mathon helped him. The husband and wife quarrelled. The wife killed the husband and threw herself in the Euphrates river. Moral: humans in the throes of great emotions are not safe risks to lend.   

Token 2: a ring of the farmer's wife. The farmer wanted a herd of goats with long, fine and soft hairs to weave rugs. He will repay and will get his ring back.

Token 3: heavy gold bracelet with jewels in rare designs. An old fat lady wants her son to become a merchant. She came to Mathon to borrow gold so that his son could be the partner with the caravan owner who travels on his camel from one city to another, bartering. The young son is not mature enough to work hard. Anyways, the jewels are worthy of the loan.

Token 4: A rope knot. Nebatur, the camel trader wanted to buy a herd larger than his funds. So, Mathon lent him for he is an honourable man.

Token 5: a beetle carved in turquoise. "This boy's father is the man of limited means and posses land and herd. He borrowed much gold and is ambitious, but, he borrowed unwisely and does not care that I will ever have my gold back. I do not want his father to deprive him of his property and herd."

Mathon suggested Rodan to ask the sister's husband, "if you want my gold to become a merchant, where would you buy your merchandise at the lowest cost? Where can you sell it at a fair price? If you can answer these questions then only I will lend you 50 gold pieces, with the security, that you will return my gold. If you cannot provide the security and say only that you are an honourable man, then, I would ask, what if while returning buying merchandise you get robbed? Further, if I give you this gold for three years, I would want 53 gold pieces back."

Tell your sister, "if your husband gives a plan, I will gladly lend him one gold coin with the security of returns." 

Mathon further advised Rodan to:

  1. Keep your Gold safe
  2. Make more gold out of it
  3. Befriend with experienced people
  4. Stay away from tricksters and quick rich schemes.

The walls of Babylon

Old Banzar was asked by an elderly merchant and a young girl about the situation of war.

King Elamites with the army of Assyrians was attacking the walls of Babylon. The walls were impregnable.

It was a five-day war and finally, Babylon won.

Moral: insurance and savings can protect you from unexpected tragedies.

The camel trader of Babylon

Tarkad, son of Azure, was hungry for 2 days.

He met Debasir at an inn. Tarkad had earlier borrowed 2 copper and 1 silver from Debasir. Debasir caught him. He too him to his house for a discussion.

Debasir told Tarkad about the story of a rich man in Urfa having a thin yellow cut stone, from which one can look to the other side, and would see a yellow world.

Debasir told the tale of how he became a camel trader from being a slave in Syria.

Debasir told Tarkad: "I used to help my father in the trade of making saddles. I got myself a wife. I borrowed money from the market to spend, ran into high debt and could not repay it. I left my wife in Babylon.

For two years I worked for Caravan traders, but I was unsuccessful. Then I went in for robbery, to loot caravans with a pack of robbers.

We were unsuccessful in our second robbery. Two of our men were killed by the spearman of a native chief whom caravans paid for protection.

The remaining of us were sent to Damascus. We had to become slaves. I was sold for 2 silver coins to a Syrian chief.

The Syrian chief had four wives. The first wife Sira helped me escape. She demanded a slave to lead a camel to her home, to visit her sick mother.

I told Sira that I was not a slave by birth but a child of a freeman. Sira commented, "you might have a soul of a slave, otherwise if you had a soul of a freeman, won't pursue to be a freeman?"

Sira suggested to me "if you want to be a free man again you should decide to pay back your debts in Babylon."

Sira plotted her mother's sickness to help Debasir escape with two camels and provisions."

Debasir and the camels were hurt in the way and ran out of provisions. Two questions arose in Debasir's mind: one, to die in the desert; two, to repay loans and be an honourable man.

Where there is a will there's a way.

Debasir went to Babylon and told lenders that he would pay their loans promptly.

Mathon, the moneylender, after learning that Debasir is a camel tender, referred him to Nebatur, the camel trader for work.

The clay tablets from Babylon

Below is the fictional conversation between two characters.

St. Swithin's College, Nottingham
Professor Franklin Cladwell, Mesopotamia
October 21, 1934.

It seems that Debasir's story is true. I have found 4 tablets that are dated 5000 years ago. These tablets can prove the existence of Debasir.

Tablet 1: advice of Mathon the gold lender:

1/10 of the earning: that man who keeps gold and silver in his purse, not to be spent, is loyal to the king and is good to his family.

7/10 of the earning: family expenditure

2/10 of the earning: debt repayment

Tablet 2: 

Names and amounts to be paid to the creditors

Tablet 3: 

I will pay all my debts impartially. Because it is easier to repay debts than to avoid them.

3 persons: Alkahed, the house owner; Brijek, the farmer; Ahmar, my friend, requested me to pay them back first.

Tablet 4:

3 times the full moon, I did according to the plan (Tablet 1, 2 and 3).

1st earning - 19 silver
2nd earning - 11 silver
3rd earning - 42 silver

After 12 moons, I have repaid all my debts, I am happy and relieved now.

Professor Franklin Cladwell
November 7th, 1936
The plan

Alfred H. Shrewsbury
Department of Archaeology

The luckiest man in Babylon

Sharru Nada, the merchant Prince of Babylon, was returning from Damascus with Haden Gula, the grandson of his partner Arad Gula. Haden was longing for luxury.

Sharru Nada told Haden about himself being a slave to ploughers, with his friends Meddigo, the farmer and Zabado, the thief, and a pirate.

Later, they were presented to a slave market. Meddigo advised Sharru about the importance of hard work.

They didn't want to be sold as the king's slave to make walls and carry bricks until your back is broken.

Nana Naid, the baker master, bought Sharru.

Sharru pitched the idea of selling cakes in partnership with Nana-naid: whatever is sold ½ of it would be invested in the business again, the remaining 2 quarters would be distributed equally among Sharru and Nana.

Arad Gula was a rug seller and Sharru's regular customer. He was also a slave, partnered with his master.

Sharru advised Arad to be a free man again because he had enough money to sustain himself.

Meanwhile, Sharru happened to meet Zabado, his old colleague who was working hard in disgust to build the king's walls.

One day, Sharru's master lost at the gaming table. Sharru was then taken by a money lender. He was told to work finishing the king's canal. Sharru was once again in a disgusting situation.

"Your grandfather bought me from the moneylender and made me his partner," Sharru recalled.

"Now I am called the merchant prince. It was all possible because of the value of the work. Luck favours hard work."


Moral of the book, the richest man in Babylon:

  1. You must have a desire to become rich
  2. You must save at least 10% of your income
  3. You must make a budget to control your unnecessary expenses
  4. You must invest your savings (10%) to make more money
  5. You must invest in the supervision of wiser people
  6. You must invest with the utmost caution, with the security that you will get your money back
  7. You should invest in the businesses that you understand well
  8. When you set a task for yourself, no matter how small or big, you must complete it
  9. You must own a home for yourself and your family. Invest in it from the remaining 90%
  10. You must ensure a future income through insurance
  11. You must increase your ability to earn by acquiring wisdom in your calling
  12. You must lead a respectful life by paying off all your debts, by taking care of your family, by making a will, by donating 
  13. You must not let opportunities escape from you because of laziness and lack of decision making
  14. Don't invest in 'getting rich quick' schemes.
  15. Hard work makes you lucky and happy

Here is the PDF of the Richest Man in Babylon


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