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Business Connections #11/2008

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A Collection of old Uzbekistan bonds and shares

I collect old bonds and shares of bankrupt countries or companies.

I call my hobby “financial necrophilia”. It's fun and very interesting, and quite different from the usual hobbies.

As there are hundreds of thousands of such financial documents - it's a bit like postage stamps - I concentrate on those that have a particularly interesting history, for example:

  • Hitler's last international bond (1938)
  • Sun-Yat-Sen's first international bond for the new Chinese Republic (1913)
  • Compagnie Universelle du Canal Interoceanique de Panama (1880), one of the earliest financial catastrophes of a major infrastructure project  a century before the Channel Tunnel Swedish Match
  • Company share, the largest bankruptcy ever of a major international company (1932)   
  • Mortgage Bond of the Duke of Osuna and Infantado, possibly the only personal mortgage bond ever, for the biggest bankruptcy in Spain in the 19th century
  • IOS - International Overseas Services - 1970 share, signed by Bernie Cornfeld, the first Fund of Funds ever, and one of the biggest international financial bankruptcies ever
  • Ottoman Empire 104-year Consolidation Loan, 1877, one of the first Consolidations of Turkish debt, and one of the longest ever
  • Assignat of the Republique Francaise, 28 Ventose an 2 (1791), one of the earliest land-collateralized bond issues by the 2-year old  French Republic
  • Barcelona Traction, Light & Power Ltd, share, one of the longest commercial litigations in history (over 30 years), which reached the tribunal of the Hague, the highest court in the world
  • Bananeries de Bluefields (Nicaragua) 1930 share, where Sandino (later, of Sandinistas fame) had his original base, and where the term Banana Republic originated.
  • Republica de Cuba 1952 5% bond  stopped paying in 1959
  • Confederate States of America, 1865 5% bond  first coupon never paid and many others, …


However, since I got interested in Uzbekistan, I started collecting old Uzbek bonds and shares. My collection today includes (* guaranteed by the Imperial Government of Russia):

  • Tramways de Tashkent, 1897, Belgian company share
  • Ferghana Oil Fields, 1912, UK company share
  • Boukhara Railway Company, 1914, 4.5% bond*
  • Ferghana Railway Company, 1914  4.5%  bond*
  • Kokand  to Namangan Railway Company, 1910, 4.5% bond*
  • United Russian Railways (including Ferghana, Boukhara, and others), 1914, 4.5% bond*


and others from the  region, within the Russian Empire:

  • Peasants' Land Bank, 1912, 4.5% bond*
  • Imperial Land Bank of the Nobility, 1889, 5% bond*
  • Altai Railway Company, 1912 4.5% bond*
  • Semiretchensk Railway Company, 1913, 4.5% bond*
  • Semipalatinsk Railway Company, 1913, 4.5% bond*
  • Mortgage Bank of the City of Saint Petersbourg, 1908, 4.5% bond
  • Mortgage Bank of the City of Petrograd, 1915, 4.5% bond

and many others, none of which have ever paid what they promised, with payment interrupted in 1917 (Russian Empire), 1959 (Cuba), China (1931), Confederate States of America (1865), etc……

It is said that the History of the World is the History of Debt. Indeed, when I come from Tashkent airport into town and cross over the rail tracks, I can't help wondering that, thanks to the Belgian and French investors who bought those original bonds, today the world is different.

When the Nazis invaded the USSR on June 22, 1941, Stalin ordered that all the weapons factories in European Russia be immediately dismantled and brought across to Tashkent on the Transcaspian Line, and to Siberia (Novossibirsk, etc) on the Transiberian line. Today's massive factories in Tashkent - the Tractor factory which at the time manufactured T-34s, the Chkalov plant which today produces the Il-76 and Il-114 but at the time the Il-1, i.e., the Douglas Dakota - are those same factories which at the time, were set up with record speed, sometimes in open air, and eventually won the victories on the Eastern Front for the Soviet Union and the Allies.

All this was possible thanks to those rail tracks, built before the Revolution and financed by European investors.

Truly, it can be said that thanks to that debt, to those pieces of paper, History is different!

Business Connections #11/2008

Business Connections #11

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