While many versions of the song exist, the most common historical explanation for the lyrics involves the people of London blowing their money at the local pub.
The original lyrics read:
Up and down the City road
In and out the Eagle,
That’s the way the money goes,
Pop! Goes the weasel
Caldecott Medal First Awarded
Supposedly, the poor people of London would spend what little money they had at the Eagle Tavern, drinking their sorrows away. They would then have to pawn their Sunday clothes for more money to feed themselves and their families.
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