adopted in 1798. It was a forced loan, by which the holders of public stocks were compelled to add thirty per cent. to what they had already paid, on pain of losing the whole; in consideration of which they were to receive five per cent. instead of four. As the loan was all made in convention money, it was understood that the interest should be paid in the same. But this was extremely difficult for the state, on account of the continual depreciation in the value of the paper currency; and, finally, it seemed to be impossible, when an attempt, made in 1802, to recruit its declining strength by lottery loans and other measures, failed. In 1811, therefore, the interest was reduced to half; and, in order to make this half still smaller, the existing paper money was changed for redemption notes, so called, a note of one guilder being paid for five old paper guilders. It was hoped that these certificates would be esteemed as valuable as specie. Hence the reduced interest was to be paid in this new paper, and not, as before, in coined money. But these notes never fulfilled the design for which they were created; and a large amount of new paper, under the name of anticipation certificates, was put in circulation, about equal in amount to that which the redemption notes had been intended to supersede, so that, in a short time, both kinds of paper sunk as low as the old bank notes. In this way, the early creditors of the state lost a large part of their interest and capital. In 1816, the finances of Austria were put under better management. The new administration devoted their chief attention to two objects:-First, to raising the value of the paper money, and, as far as possible, abolishing it; and next to fixing the public credit on a new basis, by restoring to the old claims a portion of their rights, and by negotiating new loans on a more firm and solid basis. In 1816, a new bank was furnished with funds in specie, and empowered to issue new notes, which were to be paid to the holders on demand in silver money. This bank, to which was intrusted the whole business of amending the currency and public credit, commenced its task by giving notice, June 1, that any person might bring in any sum in the old paper money, and receive for it five sevenths in new certificates, bearing one per cent. interest in convention money, and two sevenths in new bank notes, which every one might exchange at the bank for their value in convention money. Thus a proprietor, who deposited 7000 guilders in paper money, received for it 5000 guilders

in certificates, bearing an interest of fifty guilders in convention money, and 2000 guilders in new bank notes, which he might exchange for convention money at the bank, on demand. But the pressure to procure specie in exchange for the bank notes thus obtained was so great that the supplies and resources of the bank would have soon been exhausted, so that the whole system was abandoned a short time after it was established. Several millions of one per cent. certificates were created by this operation, and some of them are still in circulation. Bank shares, at 500 guilders convention money, might be obtained for 2000 guilders in paper money and 200 in convention money. The paper money thus obtained was to be destroyed. Both measures, however, only partially effected the desired object, and they were soon abandoned. October 29, therefore, of that year, a measure was brought forward founded on juster views. This gave rise to the metalliques, so called. A voluntary loan was opened, and the deposits were received partly in public certificates bearing interest and partly in paper money. For an old Austrian certificate of 100 guilders, and the additional sum of 80, 100, 110, 120, 130 guilders in redemption or anticipation notes, according as the old certificate yielded six, five, four and a half, four, three and a half, or three per cent. interest, a new state obligation was given of 100 guilders, bearing interest at five per cent., both payable in specie. A sufficient fund was, at the same time, provided for the punctual discharge of the interest, and for the gradual extinction of the capital by repurchase. This gave assurance to the proprietors of these certificates that they might sell them, with scarcely any loss, whenever so inclined. These metalliques, therefore, soon obtained extensive credit, and so confirmed the financial strength of the government, that it boldly resolved to establish the public credit on a broader basis. By a patent of Jan. 22, 1817,the sinking fund was organized after the example of the sinking fund of England,and all the funds were united in one for the payment of all public debts; and, by a regulation of March 21, 1818, the whole system of debt was reduced to such order that the proprietors of the old certificates began to be encouraged that their rights would be restored; and this hope gave the obligations once more a limited circulation. The capital of the old debt, of which the interest was reduced to half in 1811, was divided into sections, each of one million guilders. Five of these

were to be restored every year to the enjoyment of full interest, and as many more to be bought in by the sinking fund. This plan has hitherto been very successful. By the gradual liquidation of the redemption and anticipation certificates, their amount was diminished, June 30, 1825, to 149,320,813 guilders (a guilder is about forty cents); and, June 30, 1828, the amount in circulation in Austria was only 78 million guilders. The metalliques have therefore come into the market in all the principal commercial cities of Europe. In the year 1821, the whole amount of the new debt contracted since 1815, or the five per cent. metalliques, was estimated at 207,960,290 guilders, and the proportion of the sinking fund to the debt at one fiftyseventh--the same ratio which the sinking fund in England bears to the public debt. The credit of these metalliques has risen very much. They stood, in 1817, at fortyeight, but had risen, in the beginning of 1823, to eighty-six, and even during the war between Turkey and Russia, they were at ninety-five. Besides these metalliques, the before-mentioned Rothschild lotteries are well known in the money markets. The Austrian government, in 1820, negotiated, through a company formed by Messrs. Parish and Rothschild, a lottery loan of 20,800,000 guilders, and soon after a second of 37,000,000 guilders, convention money. The shareholders in the first loan were to receive back their capitals, and, instead of interest, premiums at the time of the repayment of the capitals, which was to take place in the course of the next twenty years. The smallest sum which an advance of 100 guilders can yield, is 120 guilders, and the largest 120,000. In the most unfavorable event, a man must wait twenty years for his capital and premium. The second loan was opened July 28, 1820, at four per cent.; and the government bound itself, within twenty-one years, to pay off the capital, with interest and premiums, by means of fourteen lottery drawings. The proprietors received certificates, dated January 15, 1821, each for 250 guilders. Whether a share in such a lottery can produce more than four per cent. interest, depends wholly on the time of drawing, and the premium which chance may allot. The price of the tickets of the first loan varies between 118 and 120, and of the second between 98 and 102. On an average, the premiums of the first and the interest and premiums of the second loan are equivalent to an interest of five and four fifths per cent. This new order

of things was accompanied, in 1817 and 1818, by an improved organization of the national bank. The shares, which at first stood at scarcely 500 guilders in convention money, have now reached nearly 1000, and are in great demand, for they yield an annual interest of sixty guilders. The bank is, at present, wholly independent of the government.

IV. Prussian Stocks. Prussia had no public debt till 1787, but, on the contrary, had a considerable treasure in specie, and, even under the reign of Frederic William II, till 1806, owed only thirty million dollars, which were to be paid off at fixed periods. But the unhappy French war of 1806, and the more successful one of 1812-15, augmented the public debt of Prussia; and, after it had been reduced to order, her stocks came into the market in the principal cities of Europe, like the English, French, Austrian, and other public stocks. From the statement of February 17, 1820, it appears that the capital of the debts bearing interest then amounted to something more than 180 million Prussian dollars (about 123 million Spanish), and the yearly interest, or rente, to 7,637,177 Prussian dollars. Several millions have since been extinguished by the sinking fund. At present, the following Prussian stocks are in the market:-1. the proper national stocks, which comprehend the greatest part of the public debt, and the proceeds of which, in 1820, were 4,780,000 Prussian dollars (about 3,250,400 Spanish). They consist in obligations, which bear four per cent. interest, and are to be completely discharged within five years. The interest is paid January 1 and July 1 of every year, both in Berlin and in the provinces. Provision has likewise been made for their payment in specified places in foreign countries. The certificates promise that the capital shall be paid back by the annual extinguishment of one million at par; but this regulation has been modified by a later one, ordaining that the stocks shall be diminished by being repurchased, at the current price, till they stand at par, and then the repayment shall commence. The market value of these notes varied, in 1820-23, between sixty-seven and seventy-five per cent., and, still later, rose to nearly ninety; in 1828, it was at ninety-three. Of a portion of these obligations, premium lotteries were formed, thirty millions being sold, accompanied with premium certificates, at their full value in Prussian currency. The hope of receiving a great premium on the drawing of these lotteries (ten drawings were to

take place, one each six months) produced such a demand for this species of stocks, that they rose to 120-130 dollars and upwards. 2. The shares in the English loan which was negotiated with Rothschild, in London, in April, 1818. The nominal amount is five million pounds sterling, at five per cent., and to be repaid within twenty-eight years, a certain amount annually, by repurchasing the notes, or redeeming them at par, if they are worth it. The certificates are expressed in English money, and the interest is payable in London. The unfavorable conditions, under which this loan was obtained, are to be attributed to the emergencies of the period. Though the interest is five per cent., only seventy-one per cent. of the nominal amount of the loan was received; and the government took the risk of the fluctuation of exchange in the payment of interest and principal. In London itself, before the certificates were issued, they had risen to eighty per cent. Besides these, there are the obligations of the Electoral Mark, which are of an early date, and the Hypothekscheine, secured on mortgages of the public domains, which were not created till after 1806. Both yield four per cent.. and form together a capital of nearly nine million Prussian dollars (above six million Spanish), which, like the interest, is paid according to the original engagement. There are also the stocks of the provinces and principal cities. The mortgage stocks (Pfandbriefe) form a capital of perhaps fifty or eighty millions, the shares of which are bought and sold, and yield a secure income. These are created thus:-The landed proprietors, under the authority of the government, have formed associations in several of the Prussian provinces, which borrow money on the security of their estates collectively, and make loans to the individual proprietors, in consideration of mortgages of their separate estates. There are five of these provincial associations in Prussia. To the Prussian stocks belongs, also, the bank paper, which is transferable. The circulation of these notes, indeed, is somewhat difficult, for they are generally made payable to the particular individual to whom they are issued, and cannot be transferred without legal formalities. The royal bank receives money at two or three per cent. a year, and repays the money deposited, small sums on demand, and larger ones at fourteen days, or four weeks' notice. Hence it is filled with deposits, trust money, orphans' money; and many capitalists invest in it their unem

ployed funds. The violent measures of Napoleon's administration rendered it necessary for the bank to stop payment, in consequence of the loss of all its resources. The old system has been long resumed in regard to all moneys deposited since 1808; but the pressure of circumstances has hitherto made it impossible for the bank to fulfil its obligations in regard to the old capitals. The government has promised, however, that this debt shall be cancelled.

V. Russian Stocks. Previous to 1810, Russia had no debt on which interest was paid, and of which the stocks were in the market, except 83,000,000 guilders due in Holland; and the paper was hardly found in the commercial world out of Amsterdam. For many years, this stock stood at par. In 1810, a loan of twenty millions was opened in assignats at six per cent., for which the government pledged ten million silver roubles, with six per cent. interest, to be paid in five years to those who should not prefer perpetual annuities in assignats, or silver roubles. The design was to diminish the immense quantity of assignats. It was intended to have many series of these loans following one another, to destroy the paper roubles which might be brought in by their means, and thus to raise the paper money gradually to par, or perhaps to put it wholly out of circulation, and substitute silver money in its place. Although these loans never accomplished the desired object, and seemed to be founded on mistaken principles, yet they helped to confirm the credit of the government, because every stipulation was punctually fulfilled, and a regular financial system was forming in regard to the public debts. The interest of the first loan in silver was regularly paid; and the capital, too, was repaid in the way stipulated, notwithstanding the distress to which the kingdom was reduced by the war of 1812. The credit which the government thus acquired was, perhaps, worth the sacrifice of some millions; for the state had hardly any other advantage from this loan. These stocks, during their five years' continuance, were in great demand, and their price speedily rose above their par value in assignats; but this was not strange, for paper roubles were not worth in the market one third of silver, and, by the terms of the loan, a silver rouble was paid for every two paper roubles advanced. Only a few of these obligations are now in circulation, for, in 1815, they were nearly all cancelled. This system, however, was continued under better conditions as re

ure.

garded the government, and to a much greater extent. The diminution of the assignats was the pretext for every measBut the deficit in the income, and the expense occasioned by the war of 1812, were perhaps the principal causes of the successive loans. There have been three or four since 1816. The two first, made in 1817, at Petersburg, of seventy million roubles in assignats, were mostly reduced to silver money at a fixed valuation; the third and fourth were in England, in 1820, and amounted to forty million silver roubles. All the stocks of this kind bear five per cent. interest, and are regulated after the manner of the stocks in other countries, wherein the government merely pledges itself to discharge the stipulated interest punctually. The liquidation of the capital by the sinking fund is effected by re-purchasing the certificates or otherwise, as the state of the treasury renders most expedient. The arrangements for the public debt are similar to those in France and England. All the debts since 1817 have been registered, with the creditors' names in alphabetical order. At the same time, the creditors receive notes (inscriptions), which contain what is written in the book of registry, and the conditions and stipulations of the government, and are so prepared that they may be endorsed in blank in a foreign country, being verified by a Russian consul, and in this way transferred to any one without difficulty; and the directions, necessary in case of transfer, are contained in the inscription. An important traffic is now carried on, in all the markets of Europe, in Russian stocks. The interest on the English loan is payable, not merely in Petersburg, but in Hamburg and London, in the money of those places, at a fixed valuation, and the income of the Dutch stock is payable in Holland. The report of the minister of finance, January 1st, 1822, made the whole debt of Russia to consist of the following sums:-1. The Dutch, 48,600,000 guilders; 2. the domestic, in silver roubles, 53 millions; 3. the domestic, in paper roubles, 296 millions. The fund destined for the liquidation of these debts is one million in silver roubles and five millions in paper-about in the ratio of one to fifty. Nearly ten million silver roubles are necessary for the payment of what is annually due on these stocks.

VI. Dutch Stocks. Although the public debt in Holland has been very great from the earliest times, yet, in consequence of the regular fulfilment of all obligations,

and the multitude of wealthy capitalists in the country, the stocks have maintained a high credit, and, during the thirty-two years of tranquillity, from 1748 to 1780, they were in such demand, that, notwithstanding their low rate of interest (two and a half per cent.), they brought from eight to ten per cent. above their nominal value. But owing to the wars with England and France, the finances of the country were thrown into disorder; it is probable, indeed, that these wars only hastened a calamity which must, sooner or later, have fallen upon the people; for the deficit in the income was increasing every year after 1786, and the public debt, of course, was continually accumulating. The expenditures were multiplied by the oppression of France, and the deficit daily grew more enormous. Under the administration of Louis Bonaparte, in 1807, 1808, and 1809, loans of forty, thirty, and twenty million guilders, to cover the deficit, were obtained on tolerable conditions, as Louis Bonaparte maintained the credit of the state by opposing with firmness, on every occasion, the reductions of the public debt, which his brother proposed. When Napoleon united Holland with France in 1810, it was found that the national debt of this little kingdom amounted to the enormous sum of 1200 million guilders (about 480 million dollars). Napoleon commenced a system of reform in the financial department, by setting aside two thirds of the debt, as had already been done in France. The remaining third was to be registered in the great book of France, as a part of the general national debt, and, like the rest, to pay an interest of five per cent. This measure, however, was never carried into execution. After the establishment of the kingdom of the Netherlands, subsequent to the fall of Napoleon, the debt was newly organized, and, by the law of May 14th, 1814, was regulated by the following principles:1. The two thirds of the debt abolished by Napoleon were again acknowledged, although his measure was, in a degree, sanctioned, by the division of the new debt into a real or active, and a nominal or dead one; the interest of the first (the third retained by Napoleon) was to be paid from January 1st, 1815; and the interest of the latter (the two thirds abolished by Napoleon) was to commence gradually; so that every year from four to five millions should be put on the same footing with the active debt, as to the payment of interest of the abolished debt.

All subsequent obligations were required to be presented, and for an advance of six per cent. in specie, were changed into new obligations, of which all were fixed at two and a half per cent.; in such a way, however, that two thirds of the new notes were assigned to the dead debt, which paid no interest, and only one third of the amount was transferred to the new debt, bearing interest from 1815. Charitable institutions, holders of life annuities, and some other classes, however, had some particular privileges. But the debts contracted during the French administration were put under less favorable conditions. These obligations, frequently increased by new loans, formed the Dutch stocks found in the money market, of which those that yielded an actual income, were sold before the Belgic revolution for fortysix to forty-seven per cent. Shares in the nominal debt are regarded like shares in a lottery, and stand at one quarter per cent., or even still lower (five eighths); this is sufficient evidence, how little the purchasers think of soon obtaining any income from them. In 1819, seventeen million guilders interest were to be paid. The sinking fund was fixed, in 1821, at 2,500,000 guilders annually. Besides these debts, which include those of Belgium, the government of Holland assumed the responsibility of paying a portion of the Russian-Dutch debt (of eighty-three million guilders), and 1,443,750 guilders were devoted every year to the discharge of the interest and gradual liquidation of the capital. These obligations belong to the unfunded debt, as does also the Austrian-Belgic debt of about six million guilders, and other obligations little known out of the country.

VII. Neapolitan Stocks. The Neapolitan finances, on the whole, have been subject to no little disorder; but, at the close of the last reign, measures were adopted for the punctual payment of the stipulated interest and rentes, even though fresh loans should be required. The occupation of the kingdom by Austrian troops added to the national debt upwards of nine million ducats (about 7,200,000 dollars). The French system of managing the public debt has been taken, to a considerable degree, as a pattern, the shares of the creditors being registered, and bought and sold in the same manner as in France. The yearly amount of income from the debt was estimated, January 1st, 1821, at 3,882,000 Neapolitan ducats (about 2,928,000 dollars). This income is five per cent. The Neapolitan stocks

have hitherto found purchasers in the European markets at low rates.

VIII. Spanish Stocks. The history of the old debt of Spain is a chaos of confusion. It has been always loaded with arrears and unpaid interest. According to the statement of November 29th, 1820, only a part of the Spanish debt bears interest. The part which does not bear interest consists of unpaid pensions, annuities, and many other unpaid and floating debts, but principally of paper money. These were estimated in the above mentioned year at 7205 million reals, or about 345,840,000 dollars. The public obligations bearing interest, which consist partly of old debts, new loans, &c., amount to 6,814,780,363 reals, or about 327,109,457 million dollars, of which the yearly interest is estimated at 235,966,630 reals, or 11,326,390 dollars. A plan was adopted, during the constitutional government, for paying off a portion of the debt by the sale of the estates of monasteries, the property of the inquisition, and the public lands; but the restoration of the absolute monarchy in 1823, put a stop to its execution, and the loans made by the cortes were declared to be invalid. Great deficits have since taken place every year, and till this day new loans have been utterly insufficient to cover them. The stocks which are most commonly found in the market at present are:-1. The DutchSpanish obligations of 1807, created by means of the house of Hope & Co., each of which is for 1000 Dutch guilders with interest, payable annually. The interest of this loan of thirty million guilders, and of several of the other debts, has never been paid since the French invasion of 1808. 2. The stocks of the Laffitte loan of fifteen million dollars, which was negotiated in Paris. Each certificate is for one hundred dollars. A lottery ticket is connected with every one, by which the certificate gains a greater or less premium (from 18 dollars to 20,000) whenever its number is drawn. The obligations are to be paid within twenty years from 1825, agreeably to the regulations for the annual extinction of a portion, with the premiums belonging to them. 3. The certificates of the loan of 1821, negotiated by the house of Ardouin, Hubbard & Co., fixed at different suis in dollars, and with interest payable semi-annually in Paris and London. 4. The certificates of the national loan of 1821, which is connected with the last, or rather forms a part of it. Every certificate is for 150 dollars in specie, but the old obliga