A few decades later, Venice brilliantly exploited the Fourth Crusade’s debt (and the fact that they built all the Crusade’s ships) to proceed on a debt-collection/revenge tour along the Adriatic, sacking Zara, getting the entire Crusade excommunicated, and ultimately diverting the entire force to Constantinople where they sacked the city in 1204 and replaced the government with the Latin Empire.

I found City of Fortune by Roger Crowley to be a very entertaining read, the full story of the Crusade is absurd. Venice completely dedicated its entire economy to producing the Crusade’s ships for years to make this happen.

The author was on Top Tradders Unplugged 2 weeks ago, giving a nice hour long summary, which inspired me to read the book: https://www.youtube.com/watch?v=jsOUuihvpzs

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.

It's funny how many "financial innovations" seem to start as emergency hacks

Discussed here as well: https://podcasts.apple.com/nl/podcast/the-story-of-money/id1...

The author is also part of the team behind FT Alphaville (free but requires registration): https://www.ft.com/alphaville

Technically bond markets with fiat currencies are unnecessary but for some reason they still exist.

Enjoyable read... I kept thinking so where is the Straights of Hormuz in all this :-)

Compare this to the US Civil War and the depth of perpetual debt before and after.

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Debt is crap. Except for a few categories (taxes, liquidity, structuring, benevolence) it's a game of two parties trying to out-cheat one another.

Let Ω be the core of a normal outcome distribution and / be the payoff hockey stick. Lenders want /``Ω and aren't even willing to accept /Ω. Average borrowers want superimposed Ω and / while bad borrowers want Ω/.

The rest is a game of information asymmetry and disinformation signaling. Each party is trying to outsmart the other even if the Ω is well above break-even. Often, lenders and borrowers are agents concealing the true game from principals.

Equity is better. There is no /, and strategy considerations are reduced.

Either debt draws vultures into business, or perhaps they're going to go in anyways and that's where they land. Various kinds of debt games were codified into law to make the vulture nests bigger.

Real estate is debt central.

It's funny how tied together war is with money-making.

Fun fact: possibly the first international banking system was built by the Knights Templar almost 1000 years ago to fund the first Crusade [1]. People would make deposits with them, travel to the Holy Land, possibly redeem what were very early certificates of deposit, fight and come back. Many times they'd die along the way, or fighting while there or on the way back. So the KT got rich off of unredeemed deposits. It bears some similarities to how Swiss banks got rich from WW2 except there the lack of redemption came from a death camps not issuing death certificates to now-dead Jewish depositors.

Never underestimate financial incentives. The Knights Templar wouldn't have wanted to Crusade to end and they would've wanted to encourage as many people as possible to go.

The modern day version of this is wars for oil. Except the war isn't really about oil. It's about selling weapons. Oil dependance just induces demand for weapons. So if you ever wonder why countries don't aggressively pursue renewable energy, it's because it would directly hurt weapons manufacturers.

No one goes to war over a solar panel [2].

[1]: https://www.historyhit.com/how-did-the-knights-templar-evolv...

[2]: https://www.theenergymix.com/no-one-goes-to-war-over-a-solar...