![]() |
A Venetian Meltdownfrom the Rialto to Wall Street |
![]() |
At the end of the XVth century the
banking system in Venice collapsed. The meltdown was chronicled by the
diarist Marin Sanudo and recounted, four hundred years later, by Thomas
Okey in his delightful "The Old
Venetian Palaces and Old Venetian Folk" of 1907. The following
passage is an excerpt from it. If we change the names of the Italian
banks to Lehman Brothers, Citigroup and AIG, and substitute our
President and the Senate for the Doge and the Collegio, the events seem
to be taken from the pages of the New
York Times. Read on... |
![]() “A month prior to this incident Sanudo and the Savii were summoned to the Doge’s room to confer on grave matters with the chiefs of the Ten: Andrea de’ Garzoni the banker had attended before the Seigniory, with tears in his eyes, saying he must close his doors. The house of the Garzoni, founded in 1430, was one of the four banks known as the four columns of the Temple, and the Ten had decided that for the honor of the city it must be propped up, and that the procurators of Saint Mark must advance money: and so gold to meet present claims was brought to the palace in sacks and delivered to the Garzoni, the Savii being bound to secrecy by solemn oaths. Sanudo, however, prudent man, acting on his privileged information, warned his brother to withdraw 500 ducats belonging to their mother, and saw them safely brought home in bright Hungarian pieces just before the bank failed….The tottering condition of the Garzoni bank was soon known, and, on February 1 – Marin well remembered the day, for he always prided himself of being first at the collegio, and was annoyed at finding Batista Zustignan had preceded him – the Capi of the Ten entered with grave faces and “we the Savii were ordered out.” The bank has failed owing to the furious withdrawals, crowds of creditors were clamouring at the offices, and , although it was late, none of the Grazoni had appeared. On the 4th the Capi again entered, the Savii were excluded, and Andrea de’ Garzoni, his sons and grandsons, were introduced displaying gran dolore, Andrea, an aged and most worthy merchant, imploring the Doge to grant him time to realize his assets: the bank has paid out 128,000 ducats since Christmas, and an angry crowd was clamouring outside the palace as he spoke. On March 18 the second of the great banks. That of the Lippomani, was in trouble; 30,000 ducats had been withdrawn that day, and the Seigniory advanced 10,000 ducats to help them; but to no purpose, they too failed, to the great shame of our city. It was worse, says Malipiero, than if we had lost Brescia. On the 27th the Capi, notes Marin, entered “in great fury and sent us all out of the Collegio”: it was about the bank of the Pisani. Sier Alvise was sitting as usual before his day-book when a tremendous crowd of creditors pressed in, clamant for their money. Alvise flung down his pen, shouting: “One after another, ye shall all be paid.” One creditor seized the pen and began to write; never had there been such scenes in living memory. The bank of the Agostini, too, was run upon, and such was the excitement that the Ten sent their officers, who cleared all the creditors out of the Pisani premises, and a cry was made by the herald of the Seigniory detailing the measures to be taken for the restoration of confidence: the Agostini paid out no less than 16,000 ducats, and after dinner 40,000 more, in gold, and other monies were placed upon their counter. Alvise Pisani, when he saw the crowd outside, shouted: “What a dirty business this of the Lippomani, they have ruined themselves and others by running away.” “In March 1500 the Marconi, good and worthy citizens, failed, and the creditors of the Garzoni were called publicly to ![]() …” on March 3, 1504, the Doge and many councilors, senators, and gentlemen, after a solemn mass in S. Giacomo, accompanied Sier Alvise Pisani in a procession headed by fifes and trumpets to re-open his old bank at Rialto in the name of the Holy Ghost. On March 15, 1507, a new bank was established by the diarist Sier Hieronimo de’ Priuli in place of the Garzoni house, and opened with the usual solemn ritual." |