How did the word "capitalism" arise? If you ask most investors that question today, they might mutter about markets, commerce and Adam Smith — or Karl Marx. But according to Michael Sonenscher, a British historian, the term actually emerged first in 18th-century Europe in connection with war finance.

"'Capitalism' began as a French word (capitalisme) but was used initially to refer to several largely British problems," Sonenscher notes. "The most salient was the [18th-century] system of war finance. In French, someone who lent money to a branch of the French royal government was called a capitalist (capitaliste)."

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