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Kirchberg and Weissenhorn, but he was vested with the right to coin money. Dark days were ahead because of Spain's ever increasing difficulties with its monstrous debt, much of which was held by the Fuggers. Notwithstanding these rocks and shoals, Hans Fugger from 1574 to 1597 kept up an annual expenditure of sixty thousand gulden, at the same time maintaining so great a reserve that in the one year 1589, in which his two sons were married, he was in position to expend two hundred and forty-three thousand gulden." His income came from landed estates, Tyrolean mines, but chiefly from the treasury of the company. With true German thrift, he examined into prices, restrained his children from extravagance, and above all followed his father's policy of laying out large sums on landed estates. We have an estimate of the Fugger fortune in the days of the great Anton, the friend of the emperor, which places his personal holdings at 6,000,000 florins, and the total wealth of the family at 63,000,000. Much of this wealth has vanished. Personal property at the dawn of modern government was a hard thing to keep, but the wise policy of investment in land adopted by the later Fuggers assured the stability of their house. The old motto "from shirt sleeves to shirt sleeves" was never more signally refuted. Through decades of vicissitude, through bankruptcies of kingly debtors, the land has been an anchor. Others now bargain on the Rialto, but at this very day, three great landholding branches of the Fuggers, descended from Georg through his son Raimund, hold seats in the Bavarian Upper House, the head of the family being lord of the counties of Kirchberg and Weissenhorn as in the days of Charles V. Nor is this evolution from merchant to banker, from banker to landed proprietor at all unique. The tendency is even now at work among the plutocrats of the new world.

In respect to the rate of interest, there was almost as wide a variety in the sixteenth century as in our own. The astonishing feature is that in an age where capital was so limited it was possible to procure it at such reasonable rates. Municipal bonds were held to be safest, and towns with good credit could

15 "Studien zur Fugger-Geschichte 1511-1598 und die Kunst,” p. 9. 16 Ibid., p. 9.

get money almost on their own terms. Thus the good city of Nuremberg" shows a remarkable growth in credit. In 1553 and 1554, when it was at war with the Margrave of BrandenburgKulmbach, it had to pay twelve per cent for money to strengthen its towers. Even this was low for the times, but in 1555 it made a fresh loan at ten per cent, though willing to give eleven or twelve per cent for very large sums. Three years later its credit had mounted so that eight per cent was deemed enough. In 1561 it was down to six, and in 1565 it touched five per cent, a truly extraordinary showing in the face of scarcity of capital and an increased cost of living with a rising scale of prices, the identical combination which is forcing up the rate of interest in our time. Municipalities like Nuremberg and Amsterdam could borrow at incredibly low rates at a time when the most powerful princes could scarcely get gold on any terms. For example, in the very decade of Nuremberg's rising credit King Henry II of France made a nominal loan at sixteen per That was the theory, at any rate, because sixteen per cent was the interest charged. But the king did not get off so easily. He had to pay a four per cent commission on the transaction, and a three per cent discount on the valuation of the money. But if the bankers thought they had things their own way, they were mistaken. The king could always exercise his sovereign privilege of refusing to recognize his obligations, a privilege which nearly every one of our own sovereign United States has used at one time or other. This he proceeded to do in 1559, and in the great financial crash which followed many Florentine banking houses were ruined.


Lists have come down to us of Italian houses interested in financing the later Valois kings. One for the year 1553 includes the following very characteristic names: Tommaso Rinuccini, Gherardo di Tommaso Guardagini, Carlo Rinuccini, Giovanni Martelli, Lorenzo Capponi, Bindo Canigiani, Averardo Salviati e Compagni and others. They had to steer a watchful course amid the duplicity of kings, the hatred of natives, and the ever present likelihood of national bankruptcy, but as a class they

17 Ehrenberg, "Das Zeitalter der Fugger."

19 Ibid., p. 306.

flourished. There were rich plums for those who knew how to shake them. Thus Diaceto, one of the chief bankers to Charles IX, could afford a house at one hundred and fifty thousand écus, and the county of Chateau-Vilain at four hundred thousand francs. The French hated these lordly Italians much as the Russian muzhik hates his Jewish loan shark, but the government could not dispense with them and they clung to the body politic like leeches till the general cataclysm of the Fronde in 1648.1

Notwithstanding the superior natural wealth of France and the financial independence of her kings, who could levy taxes without the consent of their subjects, she was behind both the Netherlands and England in the establishment of a real public credit. The Netherlands paved the way, and England followed in a policy of funding the national debt at a lower rate of interest. With their increased credit, both were able to buy control of sea power and to subsidize land forces, and to lay the foundation in England, at any rate, for world dominion.

Schools of domestic science have so accustomed the public to household and family budgets that it may be of interest for comparison to include that of King Henry VII, a very thrifty and prudent personage, who kept his affairs decently and in order. We have the information from the secretary of the Venetian Ambassador, Francesco Capello." As the city fathers in Venice demanded the most minute information, the summary is doubtless accurate." The nation paid the king two hundred and forty thousand crowns; the queen, thirty thousand; and the Prince of Wales, twenty thousand. In addition the king derived a total of two hundred and fifty-seven thousand crowns annually from the duchies of Lancaster, York, Clarence, Somerset, Gloucester, Exeter, and Bedford, whose revenues were Crown perquisites. Worth the collection also were the gabel, or customs duties, with their yield of one hundred thousand crowns, and the two hundred thousand from the wool duties. The nation's widows contributed their mite-fifty thousand crowns.


18 Ehrenberg, "Das Zeitalter der Fugger," p. 323. Ibid., pp. 47-50. 20 Camden Soc. Pub. No. 37, “A Relation of the Island of England.”

on the average-for permits to remarry, and large revenues came from wards whose estates the king managed, and from vacant church benefices. Then, too,--and this was a thoroughly mercantilist view of things,-in order to discourage the export of money, the king rceeived" "a Bolognese carlino per ducat" on all coin leaving the kingdom. It was the task of thirty-six sheriffs, the presidents of the thirty-six shires of England, to collect these revenues, both ordinary and extraordinary. Once in the royal hands, they staid there. The king allowed himself only £14,000 a year for the table, and only £20,000 for the other expenses of the royal family. With the rest he built the noble chapel at Westminster, and laid up a treasure for his spendthrift son to squander.

The financial side of Henry VIII's reign was as discreditable as the divorce side. The successive debasement of the coinage added to the confusion of a period of extravagance, of land speculation, of depopulation and vagrancy. It was a melancholy chapter, but with Elizabeth came new life and blood, a freer air. The great monasteries surrendered their surviving coinage rights; a British loan was for the first time fully subscribed in Britain" (1569), and the merchants for the first time could come under shelter to effect their exchange transactions. Hitherto, as in the early days of Venice, foreign exchange had been made in the open air on Lombard Street. Henceforth, thanks to the initiative of the greatest Englishman of business in the sixteenth century, Sir Thomas Gresham, the Royal Exchange was at the service of the merchants.

Sir Thomas Gresham had a unique career as financial adviser in four reigns, holding his sovereign's favor under Henry VII, Edward VI, Mary, and Elizabeth, save for a brief period in the time of Mary. He was a manipulator of the most approved Wall Street type, and we are told that by very ingenious but very unfair schemes of raising the price of a pound sterling on the Amsterdam Bourse, in a few years he was able to discharge nearly all King Edward's debts." The proudest day of his life,

22 Camden Soc. Pub. No. 37, "A Relation of the Island of England,"p. 51. 23 Ibid., p. 57. 24 Trail, "Social England," Vol. III, p. 372. 25 Encyclopædia Britannica, article on "Sir Thomas Gresham."

though, was the pageant when "the Queen's Majesty, attended with her nobility, came from her house at the Strand, called Sommerset House and entered the city by Temple Bar through Fleet Street, Cheap, and so by the north side of the burse, through Threadneedle Street, to Sir Thomas Gresham's house in Bishopsgate Street where she dined"; after which she entered the burse on the south side, and "by herald and trumpet caused it to be proclaimed 'The Royal Exchange' and so to be called from henceforth and not otherwise.'


The monarchy in the sixteenth century was alive to its responsibility as a national pageant, and this act of Elizabeth was worthy of a King Edward VII. But she had an intensely practical side as well, and when the rich men of her good city of London were slow to subscribe to royal loans, she made it very clear and emphatic that "to borrow money was a matter of great grace and favour."" Only a queen could have inspired the patriotism which this same Sir Thomas Gresham displayed on his sovereign's behalf. The Spanish ambassador had twitted Sir Thomas with the superior loyalty of Spanish grandees, and had made some odious comparisons regarding their relative wealth. To prove the English claim, the financier invited the ambassador to dinner and taking out his great pearl, the gem of a collection, he dissolved it in wine, drinking the Queen's health. "My Lord Ambassador," said Sir Thomas, "you know I have often refused £15,000 for that pearl. Have I lost or won?" "I yield the wager as lost," was the reply, "and I do not think there are four subjects in the world that would do as much for their sovereign." "


Testimony comes from every side to the rise in prices in the sixteenth century. This was the inevitable concomitant of the remarkable expansion of currency which raised the gold and silver circulation from £34,000,000 in 1500 to £130,000,000 in 1600," Elizabeth alone for a period of forty-four years coining

26 F. G. Hilton Price, "A Handbook of London Bankers," pp. 73-74. See also Lawson's "History of Banking." 27 Ibid., quoting from Mr. Francis.

28 F. G. H. Price, "Handbook," p. 74.

29 Trail, "Social England," Vol. III, P, 545. A. Hassell, "England and Europe."

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