Economy
Debt of the Day: Berlin Owes the Town of Mittenwalde 'Trillions'
Compound interest can really compound when you leave a loan unpaid for 500 years.
Let this be a lesson in paying your credit card bills on time.
Back in 1562, the sleepy eastern German hamlet of Mittenwalde loaned the city of Berlin a bit of money. It was about 400 guilders, according to a certificate of debt found in the town's archives. Berlin was supposed to repay the debt in full, along with 6 percent interest a year. But they never did. Today that 400 guilder loan is worth an estimated 11,200 guilders, or 112 million euros. If you adjust for inflation and compound interest, the debt could literally lie in the trillions.