PUBLIC STOCKS. 



747 



are well known in the money markets. The Aus- 

 trian government, in 1820, negotiated, through a 

 company formed by Messrs Parish and Rothschild, 

 a lotery 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 capi- 

 tals, which was to take place in the course of the 

 next twenty years. The smallest sum which an ad- 

 vance of 100 guilders can yield, is 120 guilders, 

 and the largest 120,000. In the most unfavourable 

 event, a man must wait twenty years for his capi- 

 tal and premium. The second loan was opened 

 July 28, 1820, at four per cent.; and the govern- 

 ment bound itself, within twenty-one years, to pay 

 off the capital, with interest and premiums, by 

 means of fourteen lottery drawings. The proprie- 

 tors received certificates, dated January 15, 1821, 

 each for 250 guilders. Whether a share in such a 

 lottery can produce more than four per cent, in- 

 terest, 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 1(12. 

 On an average, the premiums of the first and the 

 interest and premiums of the second loan are equi- 

 valent 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 consi- 

 derable 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, aug- 

 mented 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 ap- 

 pears 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 7,6'37, ' 77 Prussian 

 dollars. Several millions have since been extin- 

 guished by the sinking fund. At present, the fol- 

 lowing 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 obli- 

 gations, 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 pro- 

 mise that the capital shall be paid back by the an- 

 nual extinguishment of one million at par; but this 

 regulation has been modified by a later one, ordain- 

 ing that the stocks shall be diminished by being re- 

 purchased, 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 be- 

 ing 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 annual- 

 ly, 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 unfavourable conditions, 

 under which this loan was obtained, are to be at- 

 tributed 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 re- 

 ceived; and the government took the risk of the 

 fluctuation of exchange in the payment of interest 

 and principal. In London itself, before the certifi- 

 cates were issued, they had risen to eighty per cent. 

 Besides these, there are the obligations of the Elec- 

 toral Mark, which are of an early date, and the 

 Hypothekscheine , secured on mortgages of the pub- 

 lic domains, which were not created till after 1806. 

 Both yield four per cent., and form together a capi- 

 tal of nearly nine million Prussian dollars (above six 

 million Spanish), which, like the interest, is paid ac- 

 cording to the original engagement. There are al- 

 so 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 in- 

 come. These are created thus: The landed pro- 

 prietors, 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 in- 

 dividual 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 trans- 

 ferable. The circulation of these notes, indeed, is 

 somewhat difficult, for they are generally made pay- 

 able 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 de- 

 posited, 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 unemployed 

 funds. The violent measures of Napoleon's ad- 

 ministration 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 re- 

 gard to the old capitals. The government has pro- 

 mised, 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,OOQ 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 open- 

 ed in assignats at six per cent., for which the go- 

 vernment 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 



