Era 02 · 1600s — 1800s

Central Banks & Chartered Co.

Who speaks

A few hundred men

Pulse cycle

3.5s

States outsourced finance to joint-stock monopolies. The Bank of England (1694) and the East India Company became quasi-sovereigns — they issued currency, ran armies, and shaped what 'news from abroad' meant in coffeehouses from London to Amsterdam.

Events in this era

1694

Bank of England Founded

Chartered to fund William III's war against Louis XIV's France. A consortium of London merchants lent the Crown £1.2M at 8 percent interest. In exchange, the Bank of England received a monopoly on issuing banknotes and the right to operate as a joint-stock bank, privileges denied to every competitor for more than a century. The arrangement produced the first sustainable sovereign debt market in modern history. Every subsequent central bank inherited its basic structure.

Template for every central bank since

1720

South Sea Bubble

The South Sea Company held a government-blessed monopoly on British trade with South America, though actual trade was negligible. Shares rose from roughly £128 in January 1720 to £1,050 by July as company directors, politicians, and courtiers pumped the narrative. Directors sold into the retail mania they had manufactured. The price collapsed in September back to around £150. Parliament's investigation uncovered systematic bribery of ministers and the king's mistresses.

First modern financial fraud — £45M losses

Dec 16, 1773

Boston Tea Party

Colonists dressed as Mohawks boarded three East India Company ships and dumped 342 chests of tea into Boston Harbor. The underlying grievance was not the tax. Parliament had granted the nearly bankrupt Company permission to ship tea direct to the colonies at below-market prices, bypassing (and wiping out) colonial tea merchants. The resistance was to a corporate bailout, not a tax.

~£10,000 of tea destroyed; Revolution accelerated

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