A Brief History of Derivatives (Don Chance)

Since the Unknown Son and the Unknown Daughter are in bed, and the Unknown Wife is finishing watching tv, I thought I'd make one more post before turning in. I just came across this short piece by Don Chance (professor at Louisiana State University) titled "A Brief History of Derivatives". It's a shortened version of a longer piece that apeared in the Winter 1995 Issue of Derivatives Quarterly. One line I particularly like is :

I would like to first note that some of these stories are controversial. Do they really involve derivatives? Or do the minds of people like myself and others see derivatives everywhere?

He then traces derivatives transactions from Genesis 29 (the Story of Jacob and Rachel) through the major derivatives scandals of the early 1990's such as Proctor and Gamble, Orange County, etc...

Click here for the whole article.

This would be fun background for a derivatives/risk management course, or for a talk about derivatives to an audience of non-financial folks.