Podcast Summary
The World's Oldest Living Bond: A 400-Year-Old Financial Commitment: The world's oldest living bond, a 400-year-old financial commitment, serves as a reminder of the importance of financial responsibility and the long-term impact of financial decisions.
The world's oldest living bond, a 400-year-old document currently owned by the New York Stock Exchange, continues to pay out interest every year. This ancient Dutch bond, which was issued when someone borrowed money and promised to pay it back with interest, is a fascinating piece of history and a testament to the enduring power of financial commitments. Robin Wigglesworth, an editor at the Financial Times, was thrilled to see this bond in person after being invited to a Wall Street gala as the master of ceremonies. This bond's story is a reminder of the importance of financial responsibility and the long-term impact of financial decisions. It's a reminder that some things, like this bond, can stand the test of time. This story, brought to us by NPR, offers a unique perspective on the world of finance and the enduring power of history.
Birth of Bonds in the Dutch Golden Age: Bonds, an essential financial instrument born in the Netherlands during the 1600s, have enabled the funding of modern capitalism and numerous projects, including infrastructure and businesses, and continue to be a significant part of the global economy, with over half of today's debt in bond form.
The concept of bonds as a means of financing various human activities, from infrastructure projects to businesses and even wars, was born in the Netherlands during the Dutch Golden Age in the 1600s. This innovative financial instrument allowed the Dutch to fund public and private initiatives, leading to the development of modern capitalism and the financing of numerous projects that shape our world today, from skyscrapers and railways to Netflix. A key characteristic of bonds is their tradability, enabling the initial buyer to sell or transfer ownership to someone else, who then collects interest until the bond's expiration. The Dutch pioneered this system over 400 years ago, and it continues to be a crucial component of the global economy, with over half of today's debt in bond form.
Oldest Dutch Perpetual Bond from 1624: The Dutch have been issuing perpetual bonds since the 1600s, which continue making interest payments indefinitely, making them valuable financial artifacts.
The Dutch Water Authority issued perpetual bonds as early as the 1600s, which means the interest payments continue indefinitely. These bonds are still used today by some governments due to their ability to make continuous interest payments without having to repay the initial borrowed amount. The oldest known Dutch perpetual bond from 1624, which is still in existence, was acquired by the New York Stock Exchange. The bond's journey from the Netherlands to the United States began with a woman in Amsterdam, and it was eventually gifted to the New York Stock Exchange in 1938. The bond, which is about 13 inches by 24 inches, is made of animal skin and covered entirely in handwriting. It is kept in the archives of the New York Stock Exchange in New Jersey but is occasionally brought out for display. The remarkable longevity of this historical artifact serves as a testament to its significance in financial history.
Ancient Dutch Bond: A Link to the Past: The ancient Dutch bond, requiring physical presentation for annual interest, is a historical financial tradition connecting current water utility leaders to their predecessors, promoting financial responsibility and Dutch water infrastructure management continuity.
The ancient Dutch bond, owned by Pete, holds a rich history and connection to the past. This bond, which requires the physical presentation of the document to receive the annual interest, has been a tradition for centuries. The interest, currently €13.61 per year, has been paid by the Regional Water Authority and donated to Dutch financial literacy programs. The bond also serves as a link to the past, connecting the current water utility chairman, Jeroen Han, to his predecessors who safeguarded the country's water infrastructure. Despite the lack of recent collections, Jeroon welcomes bond owners to claim their accrued interest and receive a novelty check. The perpetual bond stands as a testament to the importance of financial responsibility and the continuity of Dutch water infrastructure management, especially in the face of climate change and the increasing risk of flooding.
Celebrating a 400-Year-Old Dutch Bond: The Netherlands' water boards, which turn 400 in 2024, preserve infrastructure and history, but a celebration cake might not be the best idea.
The water boards in the Netherlands, which preserve the dikes and protect against floods, are an essential part of the country's history and infrastructure. This will be celebrated when the world's oldest living bond turns 400 years old in December 2024. The Indicator team discussed plans for a celebration, but noted that a 400-year-old bond and cake don't mix well. This episode marked Britney Cronin's final episode as host of The Indicator, and the team expressed their sadness at her departure. The episode was produced by Britney, engineered by Neil Rauch, fact-checked by Sierra Juarez, and edited by Kicking Cannon. The episode was sponsored by Fundrise, which is expanding its real estate portfolio, and Mint Mobile, which offers unlimited wireless plans for $15 a month.
