Consider your appointment/journal diary - it goes from Jan 1st to Dec 31st. Now we can query the diary for appointments/journal entries on any day. This ordering is called the valid time. However, appointments/entries are not usually inserted in order.
Suppose I would like to know what appointments/entries were in my diary on April 4th. That is, all the records that existed in my diary on April 4th. This is the transaction time.
Given that appointments/entries can be created and deleted etc. A typical record has a beginning and end valid time that covers the period of the entry and a beginning and end transaction time that indicates the period during which the entry appeared in the diary.
This arrangement is necessary when the diary may undergo historical revision. Suppose on April 5th I realise that the appointment I had on Feb 14th actually occurred on February 12th i.e. I discover an error in my diary - I can correct the error so that the valid time picture is corrected, but now, my query of what was in the diary on April 4th would be wrong, UNLESS, the transaction times for appointments/entries are also stored. In that case if I query my diary as of April 4th it will show an appointment existed on February 14th but if I query as of April 6th it would show an appointment on February 12th.
This time travel feature of a temporal database makes it possible to record information about how errors are corrected in a database. This is necessary for a true audit picture of data that records when revisions were made and allows queries relating to how data have been revised over
time.
Most business information should be stored in this bitemporal scheme in order to provide a true audit record and to maximise business intelligence - hence the need for support in a relational database. Notice that each data item occupies a (possibly unbounded) square in the two dimensional time model which is why people often use a GIST index to implement bitemporal indexing. The problem here is that a GIST index is really designed for geographic data and the requirements for temporal data are somewhat different.
PostgreSQL 9.0 exclusion constraints should provide new ways of organising temporal data e.g. transaction and valid time PERIODs should not overlap for the same tuple.