Compare this to the US Civil War and the depth of perpetual debt before and after.
interdrift [3 hidden]5 mins ago
the story of the constantinople riots is really interesting. A foolish treaty established this unequal relationship between constantinople and venice that would later indirectly lead to the destruction of the empire through the fourth crusade and the weakening of the trade rights of its own citizens. The emperor who made that treaty was equally desperate and stupid.
alephnerd [3 hidden]5 mins ago
The Byzantine "Empire" in 1204 was barely an empire at that point anyhow. It was essentially a rump state consisting of Greece and small portions of Anatolia.
Or, if the Byzantine Empire can be treated as an empire in 1200, the Kingdom of Hungary or the Kingdom of Poland should be treated as an empire as well.
mono442 [3 hidden]5 mins ago
Technically bond markets with fiat currencies are unnecessary but for some reason they still exist.
nostrademons [3 hidden]5 mins ago
Why? The purpose of the bond market isn't to supply the government with currency, but rather to distribute risk and capital payments to those most willing to bear them.
mono442 [3 hidden]5 mins ago
The main purpose is definitely to supply the government with currency. Many countries put imo unnecessary restrictions on themselves and do not borrow directly from the central bank which would be simpler and cheaper.
nostrademons [3 hidden]5 mins ago
If that were true we wouldn't have corporate bond markets, and municipal bond markets, and mortgage bond markets. All of these are capital markets where the capital goes to either a private party or a non-monetary-authority government.
Seignoriage (the practice of the government directly issuing currency to fund its government expenditures) has been around for about 2500 years and predates the invention of the bond market described in this article by roughly 1500 years.
Ekaros [3 hidden]5 mins ago
Wouldn't that be just more complicated way to print money? With weird question about would it ever be possible lower debt without actually printing...
mono442 [3 hidden]5 mins ago
Money comes from debt. Debt is essentially the way to print money.
smallmancontrov [3 hidden]5 mins ago
No. Money is a type of debt, but a very special type, one that has no duration and is available now rather than locked up for some period of time. When the treasury sells bonds, it replaces "unlocked" money with "locked" money in the private sector, decreasing the amount of unlocked money in the private sector to balance the increased amount of unlocked money in the public sector. The amount of unlocked money remains constant.
If the Federal Reserve prints reserves (unlocked money) to buy bonds (locked money) and keeps doing this as they mature so that WALCL goes up and to the right, that's money printing.
smallmancontrov [3 hidden]5 mins ago
"Some reason" is Separation of Power applied to money printing. The Federal Reserve is an independent body guarding the money printer from the politicians.
Congress (and, increasingly, the executive) can't simply choose to print and spend. They can choose to spend in excess of revenue, but to do this they must sell treasuries, they must borrow and spend, but the bond market is allowed to say "no." We are seeing this in real time as interest rates rise. In contrast, if the politicians want to print and spend they have to beg/pressure/persuade the Federal Reserve to run the money printer and buy the treasuries.
Whether this is good or bad depends on your politics. I like separation of powers. I'm not keen on the idea of handing congress/executive the power of the printer, people in the US are very sanguine about how that can go. I'm also not keen on destroying the money printer, because the events of 100 years ago showed us what deflationary shocks look like (even worse than the inflationary shocks) and unlike my goldbug relatives and crypto-pilled friends I payed attention. The mechanism of having an independent body that guards the printer is the best compromise I have heard, so personally I'm glad it's the one we have.
Challenge: propose something better.
pm90 [3 hidden]5 mins ago
When it comes to historical articles I generally run it through claude to validate whether its someones pet theory/historical fanfic or well researched thesis. Heres what claude says:
Where it's simplified or overstated
"First bond market" in 1172. The conventional dating for permanent, tradable public debt is later. The Venetian debt became a perpetuity in 1262, when the Grand Council had the Loan Officers collect designated tax revenue to service it. Secondary-market trading is usually discussed in connection with the consolidated Monte Vecchio that came out of that 1262 restructuring. The 1172 loan is the origin of the prestiti, but 1171-72 as the birth of a trading market is a stretch. I couldn't confirm that the original certificates were freely tradable from the start. bu
tontinecoffeehouse
"World's first." Pisa's forced loan came earlier, and Genoa had its own debt arrangements in the same period. It's a headline superlative, not a settled finding.
The Procurator of Saint Mark as finance minister. This looks anachronistic to me. The Loan Officers (Ufficiali degli Prestiti) were the body charged with the debt revenues from 1262. I haven't verified the Procurator claim directly, but I'd treat it skeptically. bu
Numbers. Over 20,000 arrested and 80,000 Venetians are medieval estimates and chronicle figures, likely inflated or at best rough.
"Quiet democratic revolution." The Great Council's creation is real, but historians see its form emerging gradually, and it was an oligarchic consolidation. The author half-admits this by noting the wealthy families engineered it.
The interpretive thesis, that debt tied citizens to the state and made it credible, is a respected argument, not a fringe one. But "debt made Venice a proto-republic" is a framing, and the causation is looser than the prose suggests.
But is an interesting border case - it's in the DMZ of mostly-genai-but-with-a-human wrapper. We don't know what to do with those yet, and neither do the classifiers.
In this specific case I suppose it's probably better not to paste the output of an LLM into an HN thread, since anyone who wants to can ask one themselves. But if you wanted to rephrase what you learned in your own words, that would presumably be ok.
HN.zip
Or, if the Byzantine Empire can be treated as an empire in 1200, the Kingdom of Hungary or the Kingdom of Poland should be treated as an empire as well.
Seignoriage (the practice of the government directly issuing currency to fund its government expenditures) has been around for about 2500 years and predates the invention of the bond market described in this article by roughly 1500 years.
If the Federal Reserve prints reserves (unlocked money) to buy bonds (locked money) and keeps doing this as they mature so that WALCL goes up and to the right, that's money printing.
Congress (and, increasingly, the executive) can't simply choose to print and spend. They can choose to spend in excess of revenue, but to do this they must sell treasuries, they must borrow and spend, but the bond market is allowed to say "no." We are seeing this in real time as interest rates rise. In contrast, if the politicians want to print and spend they have to beg/pressure/persuade the Federal Reserve to run the money printer and buy the treasuries.
Whether this is good or bad depends on your politics. I like separation of powers. I'm not keen on the idea of handing congress/executive the power of the printer, people in the US are very sanguine about how that can go. I'm also not keen on destroying the money printer, because the events of 100 years ago showed us what deflationary shocks look like (even worse than the inflationary shocks) and unlike my goldbug relatives and crypto-pilled friends I payed attention. The mechanism of having an independent body that guards the printer is the best compromise I have heard, so personally I'm glad it's the one we have.
Challenge: propose something better.
Where it's simplified or overstated
"First bond market" in 1172. The conventional dating for permanent, tradable public debt is later. The Venetian debt became a perpetuity in 1262, when the Grand Council had the Loan Officers collect designated tax revenue to service it. Secondary-market trading is usually discussed in connection with the consolidated Monte Vecchio that came out of that 1262 restructuring. The 1172 loan is the origin of the prestiti, but 1171-72 as the birth of a trading market is a stretch. I couldn't confirm that the original certificates were freely tradable from the start. bu tontinecoffeehouse "World's first." Pisa's forced loan came earlier, and Genoa had its own debt arrangements in the same period. It's a headline superlative, not a settled finding. The Procurator of Saint Mark as finance minister. This looks anachronistic to me. The Loan Officers (Ufficiali degli Prestiti) were the body charged with the debt revenues from 1262. I haven't verified the Procurator claim directly, but I'd treat it skeptically. bu Numbers. Over 20,000 arrested and 80,000 Venetians are medieval estimates and chronicle figures, likely inflated or at best rough. "Quiet democratic revolution." The Great Council's creation is real, but historians see its form emerging gradually, and it was an oligarchic consolidation. The author half-admits this by noting the wealthy families engineered it.
The interpretive thesis, that debt tied citizens to the state and made it credible, is a respected argument, not a fringe one. But "debt made Venice a proto-republic" is a framing, and the causation is looser than the prose suggests.
But is an interesting border case - it's in the DMZ of mostly-genai-but-with-a-human wrapper. We don't know what to do with those yet, and neither do the classifiers.
In this specific case I suppose it's probably better not to paste the output of an LLM into an HN thread, since anyone who wants to can ask one themselves. But if you wanted to rephrase what you learned in your own words, that would presumably be ok.