September 30, 2015

Dutch centuries-old bond keeps paying interest

Filed under: History by Branko Collin @ 3:43 pm


Two weeks ago Timothy Young, a librarian from Yale University in the USA, travelled to the Netherlands to collect 136 euro and 20 cents in interest from the water board De Stichtse Rijnlanden.

The interest was paid on a bond issued for 1,000 guilders in 1648 by the predecessor of the current board to fund the building of a groyne. At the time, the Netherlands was going through its Golden Age and the navigability of important trade routes like the main rivers was a priority (German link).

Interest on the bond must be collected at least once every generation, Yale News reports. The bond (issued by the water board of Lekdijk Bovendams) remains one of the oldest known living financial instruments in the world as long as interest is collected—the reason that Yale, which paid 24,000 euro for it in 2003 according to Bloomberg, is keen to collect those payments.

The document is a bearer bond, meaning the issuer needs to see it before paying out interest. The issuer will then write the payment date on the document. This would have provided a bit of a problem for Yale, because carting around a 367-year-old sheep skin across the airways might be detrimental to its health. Luckily, space on the bond proper already ran out in 1944 and in the same year an allonge was attached to it for keeping track of the payment dates. The water board allows the bearer to simply show the allonge.

The water board has records of five other bonds that still generate interest payments. The oldest of these was issued in 1624 for 1,200 guilders, also by the water board Lekdijk Bovendams. The same water board issued bonds for a total of 300,000 guilders in the first half of the 17th century after the 32-kilometre-long eponymous dike burst numerous times, the water board writes.

Water boards are a type of parallel local government that have been around since the Middle Ages. They take care of dikes and dams, among others, in a country of which 55% of the surface area is susceptible to flooding from either the sea or from rivers. Some of these boards belong to the oldest continuous governments in the Netherlands. The water board of Lekdijk Bovendams was founded in 1323 by the bishop of Utrecht and was later managed by the king, until 1971 when it was merged with a number of other water boards into the water board Kromme Rijn, which itself was later merged into the current water board De Stichtse Rijnlanden.


(Photo of groynes at the Bovendamse Lekdijk by E. Dronkert, some rights reserved; photo of the bond by Yale University)

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December 28, 2012

Gorilla had a good 2012 on the stock exchange

Filed under: Animals,Weird by Orangemaster @ 2:24 pm

Although gorilla Jacko had a bad year in 2011 for the first time, this year Jacko was back on track, outperforming the AEX (Amsterdam Exchange index), as he has done 12 years of out 13.

The stocks picked by Jacko using bananas rose 12% in value over the year, while the AEX rose by 10%. “Jacko’s profits are largely due to Heineken, Aegon and Aalberts, which rose sharply in value. Unfortunately he sold Ordina and Aperam with a large loss.”

So if a gorilla can do it, maybe we can too.


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December 10, 2011

Prime minister Rutte misleads Wall Street Journal about Dutch debt problems

Filed under: General by Branko Collin @ 2:30 pm

Debt to income ratio (%) for households in 2010. Source data: Eurostat.

Last week the Wall Street Journal published an excellent article by Matthew Dalton titled Mortgage Burden Looms Over Dutch. Us Dutch have an average debt of 2.5 times our yearly income, which makes us the heaviest lenders of Europe.

We got into this position because of the way we structure our mortgages. We borrow heavily, then let that debt stand for decades. Interest is deductible from our income tax.

Asked of Prime Minister Mark Rutte (VVD party) whether this is a problem he told Wall Street Journal:

“It’s not a big issue…if you look at the whole picture,” he said, noting that the Dutch have saved as much in their pension funds as they have in mortgage debt—”and we have huge private savings.”

Financial news website Z24 sorta-kinda calls Rutte out on that. “Staat genoteerd”, (duly noted) writes Jeroen de Boer, i.e. “whatever“. What the Wall Street Journal doesn’t know, and what somebody who is such a great fan of “the whole picture” should have told them, is that mortgage interest deductions are one of the core political wedge issues in the Netherlands. Both Rutte’s party VVD and their coalition partner CDA have told their constituencies time and again that they will never abandon the tax deduction.

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September 19, 2011

Bank managers give cheaper loans to customers of the same sex

Filed under: General by Branko Collin @ 8:58 am

If you want to save as much as 0.3 percentage points on your interest rates, close a loan with a bank employee of the same sex.

Thorsten Beck, professor at Tilburg University, claims that there is a measurable difference between how loan officers of microcredit lenders treat customers of the same and of the opposite sex. His report Sex and Credit: Is There a Gender Bias in Microfinance (PDF), co-written with Patrick Behr of the Brazilian business school Fundaco Getulio Vargas and Andreas Madestam of the Bocconi University in Milan, focused on lenders in Albania.

The reason they looked at microcredit lenders is because they do not use standard interest rates the way regular banks do.

The chance that opposite sex customers return for a second loan is 11.5 percent smaller, reports.

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September 15, 2011

2012 government budget hack explained

Filed under: IT by Branko Collin @ 7:24 pm

Ha ha! As Dutch News reports:

The government’s 2012 spending plans have been leaked on the internet, a day ahead of their official publication.

A spokesman for the finance ministry has confirmed the leaked documents are genuine. They were apparently found by hackers on a part of the government website which was not protected by a password.

And here’s how NOS Nieuws explains the hack:

[Somebody] typed in the address of last year’s budget, and changed ‘2010’ in ‘2011’.

The original budget busting tweet can be found here.

Traditionally the yearly budget is presented on Prinsjesdag, Day of the Princelings, after the Queen addresses both houses of parliament in joint session. Reporters who promise to not divulge the contents of the budget get an advance copy—others just wait until the traditional leak. In 2007, the budget was sent to the press in the form of a USB stick.

Dutch News has the low down on the contents of the budget, by the way.

(Photo of marechaussée practicing at the beach for a Prinsjesdag parade by the ever prolific Facemepls, some rights reserved)

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February 21, 2009

Monkey business

Filed under: Animals,General by Eric @ 5:10 pm

Gyasi, financial gururillaWhat do you do, when all the money you invested in stocks and options is losing weight faster than the contestants in the tv show de Afvallers XXL? Whom do you turn to, when your own financial advisor is only foreseeing doom and gloom and you’re desperatly looking for impartial and unbiased tips on where to put those 50 eurocents you still call your capital?

Enter Gyasi, a six year old gorilla, currently living with her family in Primate Park Apenheul in Apeldoorn. Over the next thirteen weeks, Gyasi will pick one share listed on the AEX from a stock of ten, each week. In order to raise Gyasi’s interest in the experiment and possibly also to ensure an impartial and unbiased selection, Gyasi will not pick the share directly, but she will be presented a row of numbered walnuts. Each number corresponds to a share on the AEX. The walnut that gets munched first, will be the winner for the week.

The real question, of course, is: will Gyasi outperform the dolphins from the Harderwijk Dolfinarium?

Link and photo:

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