Here’s the scenario with a couple of made up amounts.
I buy a house for 20,000 ducats (we’ll assume that there was no down payment)
Many years later house is worth 40,000 ducats. I have paid off 10,000 of the loan so I have 30,000 of equity.
Due to a recession the value of the house falls from 40,000 to 35,000 ducats.
I still have 30,000 ducats of equity, right? I looked round the 'net a bit and could only
find articles about “underwater” loans where the house price falls below amount owed
on the loan.
Sadly, no. You own a house worth 35,000 ducats, subject to a mortgage securing a loan of 10,000 ducats. Your equity is (35,000 - 10,000 =) 25,000 ducats. If you sold the house, cleared off the loan and trousered what was left over, you’d have 25,000 ducats in your pocket. That’s what “equity” means.
If the 20,000 ducats by which the house appreciated in value added to your equity, why would you think that the 5,000 ducats by which it has contracted in value would not subtract from your equity?
Thanks for the answer UDS1. I should have drank a cup of strong coffee to wake up
my brain before posting that question. The answer seems so obvious now.
A quick google hasn’t turned up any source for an average male weight in the Middle Ages, but apparently an average weight for a European male in the mid 19th century was 139 pounds and that is before the current age of food abundance, and so a good enough approximation for literary purposes IMHO. An average Italian male is now about 80.9kg and an average American about 200 pounds.
So in present day currency Shylock would have demanded around 580 grams of flesh from Antonio. Or if the play were set in the US - 1 lb 7 oz.
Going one step farther than @UDS1’s excellent answer …
If your sell price is 35K above your loan balance, you have 25K of accounting equity. But if you have to pay sales agents, transfer taxes, and various other transaction costs of, e.g., 4K to actually sell the property, then your realizable equity is just 25 - 4 = 21K. That’s the economic value you can extract from this situation and apply to some future spending on whatever.
I’m unaware of “pound of flesh”’s origin to be anything other than a literal pound of flesh that Shylock demands in Merchant of Venice. It has certainly come to mean other things, and is used as an idiom and metaphor, but the origin is pretty clear in the play. What is your understanding of its meaning?
As I was taught it, the “pound of flesh closest to your heart” didn’t literally mean flesh from your chest. It meant the flesh you held most dearly, i.e. I’m gonna cut your (genitalia) off. It makes it mean SO much more
There’s a lot of essays out there discussing where Shylock wanted to cut the flesh from, and that’s certainly an option. But he had murder on his mind, and was likely going for his heart. Here’s a fun little article I just found that suggests Anthonio and Shylock were debating the source of flesh, and that cutting off the penis would mark Anthonio as a Jew, but cutting the heart would remove Anthonio’s Christianity (and kill him).
Whichever it was, it was clearly a precise pound of actual flesh.
It gets more complicated if you consider inflation and the value of a Ducat. A Venetian ducat was 3.545g of pure (by Renaissance standards) gold. At today’s price that is around $190.
If the OP’s house was truly worth 35,000 ducats, that would be the approximate equivalent of $63,650,000, so equity would be the least of his problems.
