History unveiled at UTM

Monday, November 14, 2016 - 9:10am
Sarah Jane Silva
Louis Florence
Professor Louis Florence stands in front of his family’s collection of historical bond certificates holding a soap dispenser invented by his late grandfather and namesake. Photo by Ryan Cerrudo.

Department of Management director donates collection of historical bond certificates to the Li Koon Chun Finance Learning Centre

Issued between 1909 and 1920, fifty German bond certificates were donated by the Florence family to the UTM Library for use by the Li Koon Chun Finance Learning Centre.

The unveiling took place last Friday where family, faculty, staff and students gathered to hear Professor Florence reminisce about his grandfather’s journey from Lithuania to Peterborough, Ontario during the turn of the twentieth century.

Born in 1883, Louis Florence moved to Canada in 1900 and worked as a peddler of rags, paper and scrap metal. Over time he accumulated some money and became an investor in stocks and bonds.

“He ended up presumably buying these bonds somewhere in that period,” said Professor Florence.

The idea of a donation of this collection originated during a conversation he had with Andrew Graham, lab manager at the FLC, regarding their value.

“The question came up - do they have any actual value? Could they be converted into something else and be worth millions of dollars today?”

It turns out, however, that the bonds are of little value.

Bonds such as those displayed at the FLC were issued by a cash-strapped German government struggling to pay reparation bills after the First World War. At the time, hyperinflation was driving down the value of the mark and Germany's economy was near collapse.

German newspapers published pictures of people hauling around wheelbarrows full of currency that were barely worth the paper they were printed on.

Further, the certificate bonds Professor Florence donated are in various denominations and outline a series of interest payments in the form of tear-off interest coupons cashable at specific dates.

The redeemable tear-away portions of the documents remain intact, so the interest was never collected. The devaluation of the Germany currency at the time likely rendered the bond valueless.

“That’s likely what the story is with these bonds but they are attractive and interesting as historical objects and artifacts.”

Both Graham and Helen Kula, librarian at the Institute for Management & Innovation, also recognized the aesthetic value of the certificates.

“They are quite beautiful in their own right,” said Kula, who also sees the value of the certificates as teaching objects. 

“Students today largely experience the business of finance as digital –  trading, analysis, news-gathering and other market activity is all now transacted online,” she added. 

Having a portion of this collection on display in the FLC will give students the opportunity to see the pre-digital or analog versions of a financial instrument.

“Particularly for bonds, this collection provides students with another way of understanding what coupons involve.”

At the end of the unveiling, Professor Florence thanked everyone involved with organizing the event, including Andreas Park, associate professor of finance at IMI, who helped translate the text on the bonds. He also acknowledged family members including his sister, cousin, wife and daughter who were also in attendance.