RISE OF ROTHSCHILD - 4. The Brothers Rothschild During the Period of Congresses, 1818-1822 - Count Egon Caesar Corti - SECRETS OF POWER: Masters of Politics, Strategy & War

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Speaker 1 (00:00):
The Rise of the House of Rothschild seventeen seventy to
eighteen thirty by County gon Caesar Cordy, Chapter four, The
Brothers Rothschild. During the period of Congresses eighteen eighteen to
eighteen twenty two, the great fortune of the Rothchilds had
been made. It was now a question not only of

(00:20):
preserving it, but of developing it and of employing it
as remuneratively as possible. The convulsions through which all the
states of Europe had passed and the enormous military efforts
made during the preceding quarter of a century, had produced
general confusion in their finances, which could be straightened out
only by hard work and peace conditions. Every state had
been spending money lavishly for a long time, and the

(00:43):
resulting shortage of money was very acute. The poverty struck
states had to acquire the cash necessary for their recovery
from those who had succeeded in profiting by war conditions,
to accumulate riches as contractors or through financial operations. Foremost
among these was the House of Rothschild, and it gladly
lent money to princes and states as the repayment of

(01:04):
such loans through their subjects was secured. Thus it advanced
Moneys to numerous small princely families, especially to those of
the neighborhood, while its relations with the Elector of Hesse
remained outwardly unchanged. Although he was the third son, Nathan
incontestably looked the leadership among the five brothers. His long
and fortunate connection with the English government had taught him

(01:26):
both the advantage of concentrating on really big financial operations
and the comparative safety of carrying through such operations with
powerful states. For the concern of these for their public
credit and their prestige, made them regarded as essential to
carry out obligations punctually. Nathan was not in the least
inclined to rest upon his laurels or to limit himself

(01:47):
to the preservation and enjoyment of the family's great fortune.
His aim was to increase the power of his house,
and he held the view that in order to win
a victory, ducats like soldiers, had to be concentrated in mass,
suddenly and unexpectedly upon a wisely selected point. This was
the dominant note in the policy of his house during
the following period. In order to apply this policy, it

(02:10):
was necessary, now that his firm enjoyed the high regard
of the business community, that he should secure his position
in society as well. The Austrian patent of nobility had
given him a good start in this direction, but his
native city and the Senate of Frankfort continued to adopt
an unfriendly attitude toward the Jews, including the Rothschild family.

(02:30):
Amskill at Frankfort, who had been placed in charge of
the campaign against the Senate, used every opportunity for exerting
external pressure upon the authorities of the city, especially through
Prussia and Austria. At the beginning of the year eighteen eighteen,
a favorable opportunity occurred for again enlisting the support of
the Prussian Chancellor, Prince Hardenberg, who was well disposed toward

(02:51):
the Jews. The state finances of Prussia were, like those
of Austria, in great confusion. The deficit was large, and
it seemed not improbable that the pay of civil servants
and of the army would have to be suspended. The
treasury lived from hand to mouth, and the king himself
was being done by small tradesmen. In these circumstances, Barranden

(03:14):
the London representative of the Prussian Mercantile Marine, had recommended
that a loan should be raised in England, and that
for this purpose recourse should be had to Nathan Rothschild.
Hardenberg readily agreed and asked Damskill at Frankfort, whom he
knew personally, to use his influence in favor of securing
this loan. Amschkill consented and used this opportunity of again

(03:36):
appealing to the Chancellor on behalf of the members of
his faith at Frankfort. At the present time, he wrote,
when his Excellency, the Minister and Envoy to the Diet,
Count Vaughan Bohle, is with your Excellency, I beg to
renew my most humble representations regarding the fate of the
members of my faith here, who are awaiting in great
suspense the decision of the Diet. We place our greatest

(03:58):
hopes in the honored Prussian Government and cherish the most
sincere wish that the principles recognized by it will be applied.
Convinced that your Highness knows too well how to appreciate
the cultural progress made by our community during the last
forty years to allow the way to their further development
and improvement to be barred or them to be limited
in this respect. Hardenburg was quite willing to accede to

(04:19):
this request, since in doing so he would be acting
in accordance with his own personal convictions. He had, however,
a difficult task with his king, who was not well
disposed to the Jews. The monarch told him the measures
he could apply if action were taken by the Magistracy
of Frankfort, but at the same time expressed the desire
that the wishes of the Magistracy should be met as

(04:40):
far as possible. In any case, the resolution concluded, I
do not wish Prussia to support the Jews in the Diet.
On this, Hardenburg angrily commented, first add ACTA, we have
at any rate the decisions of the Congress of Vienna
to go upon. However, the King came off his high horse,
for Hardenburg had made him realize that the Prussian state

(05:03):
would need the Brother's rothschild for a loan, and that
it would not be good policy for Prussia to alienate
them by an attitude unfriendly to the Jews. In the
Diet of Frankfort, the majority of the diet were in
any case in sympathy with the desires of the Senate
at Frankfort, and the rights which the Jews had acquired
in eighteen eleven seemed therefore to be in peril. Only

(05:23):
the powerful influence of Metternich and Hardenburg had so far
restrained it from taking a definite decision hostile to the Jews.
Amshkill regarded the head of the House of Bethman, which
was being more and more overshadowed by the Rothchilds, as
a natural enemy of the Jews, but Bethmann refused to
admit that this was so. If her James, he wrote

(05:43):
at the time to David Parish, will but visit me
at Frankfort, he will soon realize that I am not
influenced by any nonsense about Christians, and that I have
no prejudice against a reputable Jew. I have often attempted
in vain to disabuse Amskill of the stupid illusion that
I am opposed to the demands of the Jews Sewish
community at Frankfort in so far as they are reasonable.

(06:03):
The fact that I am suspected by my fellow Christians
of taking the Jewish side should convince him, if nothing
else will that he has no ground for his attitude.
Amskill Meyer certainly was greatly interested in keeping on good
terms with Prussia and Austria. Prussia's acute financial distress seemed
to provide a further excellent opportunity of earning a large
amount of money, and he did all he could, in

(06:26):
close collaboration with his brother Nathan in London, to induce
Prussia to come to the Rothschilds for refuge. That kingdom
had very good reason to look around for money for
In eighteen seventeen, the state was carrying a burden of
twenty millions of floating debt, interest being charged on part
of this amount at the extravagant rate of twenty percent
per annum, the payments being met by further borrowings each year.

(06:49):
Apart from this, the annual budget showed a deficit of
several million failers. Prince Hardenburg, by the King's command, accordingly
instructed the Director of the Prussian Treasury to negotiate alone.
The Director, Christian Vaughan Rother, was a highly competent official
in Hardenberg's right hand man in financial matters, and he
had come into special prominence in raising money during the

(07:11):
wars of liberation. It is essential, wrote the Prince to Rather,
that we should obtain money for various purposes. The maintenance
of the state urgently calls for it. I am eagerly
waiting to hear from you act with decision and courage.
Rather first tried Berlin firms, but they attempted to exploit

(07:32):
the difficulties of the situation, and, as he reported to
the King, the conditions which they proposed were exorbitant and humiliating.
In Holland he had no success either, but he fared
better at Frankfort. As Prussian Commissioner of Finance. He had
already come into contact with the House of Rothschild in Paris,
and he now succeeded in getting on exceedingly good terms

(07:53):
with Amskill Meyer. Amshkill referred him to his brother Nathan
in London as the most likely person to make the
lonea success. Hitherto, Barranden had conducted the negotiations in England,
but he was not liked by the House of Rothschild. Rather,
on the other hand, the brothers had known in Paris,
and they regarded him as a more pleasant person to

(08:14):
deal with. Indeed, they preferred him in every way, and
were exceedingly gratified when he came to London and Barranden
was left out in the cold. They were now dealing
only with two friends of their house, rother and the
Prussian ambassador in London, William Vaughan Humboldt, the brother of
the great explorer Alexander. He himself was not only a diplomat,

(08:36):
but also a distinguished scholar and philosopher. Humboldt understood little
of money matters, and he left his private estate to
be managed by Rothschild. Whereas rather was regarded as a
financial genius in his own country, Humboldt was certainly a
complete believer in Nathan Rothschild's indisputably superior talent for finance.

(08:57):
He reported in this sense to Berlin, using words which
are especially remarkable coming from such a man. If the
loan is to succeed here, his report ran, this can
be managed, in my opinion, only through Rothschild. Rothschild is
now easily the most enterprising business man in this country.
He is a man upon whom one can rely and

(09:18):
with whom the government here does considerable business. He is also,
as far as I know, just exceedingly honest and intelligent.
But I must add that if business is given to
him to carry out, it will be necessary to fall
in with his ideas. For he has acquired the independent
habit of mind developed by Riches, and a fairly long

(09:38):
sojourn in this country, and he is now engaged in
such a constant number of financial transactions that it will
not greatly affect him if one of them fails to
come his way. He wants to take over the whole
loan himself. On this point he is likely to be
exceedingly firm, and he has asked in advance that the
Prussian consul here, against whom he is prejudiced, shall not
be allowed to interfere in the matter in any way.

(10:00):
Humboldt's report is all the more valuable as an expression
of opinion, since he proved his independence in concluding it
by advising against the acceptance of the loan, this being,
of course, quite contrary to Nathan's wishes. Rather, on the
other hand, speedily came to terms with Nathan regarding a
loan of five million pounds. This he considered advantageous for Prussia,

(10:22):
as other important states were able to obtain money by
loan only in small amounts. In spite of the ups
and downs of the negotiations, exceedingly cordial relations seemed to
have been maintained throughout between Rother and Rothchild. At any rate.
This is indicated by their correspondence at this time. Rather
wrote to Solomon Rothschild, who was also in London at

(10:43):
the time, that he had been glad to make the
closer acquaintance of his brother Nathan, whose character and intelligence
he felt compelled the greatest admiration. Solomon's reply was full
of friendliness and candor. His letter was, he indicated, an
expression of his sincerecis feelings, and Nathan and Solomon assured
Rather when he left that he could travel with a

(11:05):
light heart. He had achieved a splendid piece of business,
and they were his devoted, loyal and eternal friends. This
way of getting into the good graces of the Prussian
negotiator did not fail of its effect. Rather was delighted
that he had carried the business through, and that on
the day on which the agreement was concluded, Nathan sent
a ship to Hamburg with a million failers as a payment.

(11:27):
On account. Rather had, if possible, been even more strongly
impressed than William Vaughan humbold By Nathan's influence the Rothchild
in this country, he reported to Berlin, is a most
estimable person and has an incredible influence upon all financial
affairs here in London. It is widely stated, and is
indeed almost a fact, that he entirely regulates the rate

(11:50):
of exchange in the city. His power as a banker
is enormous. The loan, which was issued at an average
price of seventy two percent, turned out to be a
splendid piece of business for Rothchild, as it never fell
below the price of issue, and in eighteen twenty four
actually reached par The house of Rothchild therefore had every

(12:10):
occasion to be pleased with this the first big state
loan which they handled, and they were encouraged to develop
this line of business on a large scale. This loan
was the first of several. The brothers had formed valuable
friendships through these negotiations, and William Vaughan Humboldt introduced them
to his famous brother Alexander. It was not long before

(12:32):
he was seen dining at Rothschild's house in London. Nathan
was more frequently the guest of William Vaughan Humboldt, whose
wide education and extensive knowledge certainly provided a contrast to
the Frankforter who had risen so rapidly. Humboldt expressed himself
candidly about him in a letter to his wife yesterday.
The letter runs, Rothschild dined with me. He is quite

(12:55):
crude and uneducated, but he has a great deal of
intelligence and a positive genius for money. He scored off
Major Martin's beautifully once or twice. Martins was dining with
me too, and kept on praising everything French. He was
being fatuously sentimental about the horrors of the war and
the large numbers who have been killed. Well, said Rothschild,

(13:18):
if they had not all died, Major, you would presumably
still be a subaltern. You ought to have seen Martin's face.
The Rothchilds were anxious to maintain their friendly relations with
the Humboldt brothers. Solomon also did his best to be
agreeable to them whenever possible. Meeting Caroline Vaughan Humboldt at
Carlsbad on one occasion, he overwhelmed her with attentions. She

(13:42):
wrote to her husband, I have had several callers, and
among others her vaugh rothschild the brother of the one
who is looking after your affairs at Frankfort. He made
some exceedingly comic remarks to me. He thanked me in
the course of his conversation for receiving him, and said,
your excellency ought to come to Frankfort again. We could

(14:03):
do with a lady like you there. It sounded extraordinarily funny.
He also asked me whether he could be of use
to me in the matter of money, and said that
his purse was at my disposal. The Prussian loan which
the brothers Humboldt arranged with the Rothschilds furnished another excellent
illustration of the way in which the three brothers worked together.

(14:24):
While Solomon and Nathan were dealing with that business in London,
amskill Meyer was meeting an awkward situation at Frankfort. In
the case of propositions which the firm did not like,
they could excuse themselves by pointing out the difficulty of
obtaining the agreement of all the brothers, that is, of
five persons who usually were widely separated from one another,

(14:44):
this agreement being necessary for any substantial transaction. These tactics
were adopted in a matter involving the Crown Prince of Hesse,
who was constantly at loggerheads with his father. The Elector
was now seventy five years old and failing in contrast
to his parsimonious father. The Crown Prince had made himself
popular by a manner of life from which many persons profited.

(15:08):
This involved very heavy expenditure, and the Heir's need of
money was all the greater since the uppunage allotted to
him by his father was, according to his ideas, at
any rate, ludicrously inadequate. The consequence was that the Prince
found his way to the firm which owed its rise
and prosperity to his father. He applied to Rothschild for
a loan. Naturally, this was done quite in secret, without

(15:31):
the knowledge or consent of the Elector. At the beginning
of eighteen eighteen, the Prince requested a loan of two
hundred thousand reichstalers, which the House of Rothchild granted, But
before six months had expired, he asked for a further
advance of three hundred thousand reichstalers. On this occasion he
remarked that the House of Rothschild had the fullest information

(15:51):
regarding the Elector's affairs, and could therefore easily provide for
the subsequent repayment of the loan. Karl Rothschild happened to
be in at the time. The Prince immediately summoned him
and informed him that he had again applied to his
firm for money, making the same remark to him as
he had made to the firm. Karl Rothschild left the
audience chamber in reflective mood. He thought it exceedingly strange

(16:16):
that the Prince should already have incurred further debts, and
he was somewhat annoyed at the remark which he had
made in asking for the loan. There was a risk
that the old Elector might come to hear of his
son's borrowings, and they would arouse his indignation not only
with his son, but also with the firm of Rothschild.
Karl Rothschild met a chamberlain in the ante room and

(16:37):
made some remark which may have sounded ill tempered about
the request for a further loan. After returning to Frankfort,
Karl took counsel with Amskill, who was there alone. The
result was embodied in the following letter. Most excellent Prince,
we have the honor to acknowledge your Highness's most gracious
letter of twenty eighth Oltimo. We must confess that, having

(16:58):
but recently handed to you, your Highness, the considerable loan
of two hundred thousand Reichs Tilers, we did not expect
to be asked for a still greater amount. Your Highness
will be graciously aware that we can act only in
agreement with our absent brothers, and we shall therefore not
fail to communicate to them your Highness's letter asking them
for their views. In the meantime, we would most submissively

(17:20):
beg for a gracious explanation of the following passage in
your Highness's letter, in which your Highness is pleased to
state you have the best possible knowledge of the Elector's
business here, and it is therefore particularly easy for you
to reimburse yourselves through discounting bills. Our knowledge of the
Elector's affairs extends only to such business as we are
entrusted to carry out. It is impossible for us to

(17:42):
retain a single farthing and to apply it in the
interest of your Highness, For we furnish the fullest accounts
of the smallest transaction and send them to Castle. This
letter was to fulfill a double object. It would stave
off the prints for the time being, and it would
also be a protection against any reproaches from the Elector
if the matter leaked out. The letter displeased the Prince exceedingly.

(18:04):
He perceived the rebuke and would have liked to reply indignantly,
but he restrained his feelings as he still hoped to
get money from the Rothschilds. However, he felt that in
these circumstances it was difficult for him to carry on
the negotiations personally. He accordingly selected Butterus as a go between,
requesting him to keep the matter strictly secret from the Elector.

(18:26):
Having learned of the chance arrival of Baron Carl Vaughan Rothschild,
the Prince wrote to Butterus, anticipating the future title of
the family, I felt that I should inform him of
the application I had made to his firm, and did
so most politely. He, however, replied in a most unfriendly
way and permitted himself to make remarks behind my back
which are not consonant with my honor. The young Prince

(18:49):
stated that nevertheless, he still had confidence in the firm
and begged Butterus to use his influence to help him
out of the awkward situation. He suggested that the Rothschild's
letter must be based upon a misapprehension. I for my part,
he continued, could of course never have thought of such
a thing, my intention being to indicate to him that
he would be fully secured as he would have me

(19:10):
more or less in his hands. Deuterus hastened to carry
out the wishes of the heir to the throne, his
future master. He went to Frankfort and remonstrated with Karl
Rothschild for making the remark to which the elector's heir
had taken exception. Karl Rothschild protested that he had made
no remark regarding the further loan to any one excepting Holsforster,

(19:31):
the gentleman in waiting, who was kept fully informed of
the financial affairs of the air. Deuterus reported to the
young Prince, I have succeeded in persuading Finnansrat Karl, who
was the only one of the brothers at Frankfort, temporarily
to advance a few thousand Friedrichters. Finnansrat Solomon of London
has gone to a spa, and fininsrat Amskill is also traveling.

(19:54):
It will require a month to obtain the replies of
the absent brothers. However, the heir to the O was persistent.
He immediately informed Butterus that he was not going to
be fobbed off with a few thousand Friedrichters, and added
a remark which savored strongly of a threat I know.
He wrote that these gentlemen will be entirely guided by

(20:14):
what you say, and my gratitude and future to Privy
councilor Vaughan Carlshausen will be commensured with his readiness to
do me a service. Now, the letter went on to
make proposals as to how the three hundred thousand reichstailers might,
in spite of everything, be obtained from Rothschild. The faithful
Butterus felt very bitter about this ungracious reply. He could

(20:35):
not force the banking firm to hand out money at
the point of the bayonet, I most humbly assure your highness.
He replied that the will to carry out your desires
is not lacking, and that I would spare myself no
labor or sacrifice to that end, for I find my
greatest satisfaction in the success of my endeavors. Nevertheless, with
the best will in the world, I am unable to

(20:56):
dispose of another person's property or to dictate to him
how he should deal with it. Deuterus reported that he
had immediately sent a further pressing request to the firm
of Rothschild, and had received the following communication from Karl seventeen.
I am anxious to accede to his Highness's request and
assure you that if it depended on me alone, there
would be no obstacle to its being immediately granted. However,

(21:20):
in the present instance, consultation with all my brothers, who
are now away, is particularly necessary. Our funds have been
to an extent tied up in the recent negotiations for
considerable loans, and I am unable, to my infinite regret,
immediately to come to a decision. Nevertheless, your Excellency may
be assured that we shall make every possible effort to

(21:40):
satisfy His Highness's requirements. Meanwhile, Solomon had returned to Frankfort,
and it was decided after all to advance the Prince
the money he wanted on very special security. By a
deed dated October fifteenth, eighteen eighteen. He mortgaged not only
all his real and personal property, to the exclusion of
nothing whortped soever, but also any property of which he

(22:02):
might become possessed in the future in any way. Whatever
three months had scarcely elapsed. When the Prince was again
in need of money, he himself felt that Carlshausen would
think it strange that he should already want another one
hundred thousand gulden, and he first tried to see whether
he could acquire the money from his father's friend, a
lady whose politeness led him to expect that she would

(22:22):
not refuse his request. The Countess Vaughan Hessenstein evaded the
question of a loan. In her reply, the young Prince
would have gladly paid the firm of Rothschild ten percent interest,
if only he could have got the money. Vaughan Carlshausen
was instructed by the Rothschilds to inform him that the
firm never accepted interest at ten percent, as this would

(22:43):
be a usurious rate. Thereupon, the Prince wrote as follows
to his father's loyal servant, I am well aware that
the House of Rothschild can loan no capital sums in
cash at five percent without loss, and at the same
time that the prestige of the firm is too great
to allow them to take a higher rate of interest,
a fact which is entirely to their credit, although in

(23:03):
these times no objection could be made to the higher rate.
I am therefore confident that your Excellency will, with your
usual kindness, use your good offices with the House of
Rothschild to persuade them to grant me a further loan
of four hundred thousand failers. This request moved the firm
of Rothschild to indignation. Your letter, they wrote to Karlshausen

(23:24):
arrived at the same time with the letter embodying the
resolve of our brother at Berlin, in accordance with which
it is plainly impossible for us to provide a sum
exceeding the five hundred thousand reichs tailers in cash already advanced,
especially in view of the fact that we have had
to make the most exhaustive efforts to provide that sum.
The use of the word resolve in this letter calls
for special comment, this word usually being reserved for the

(23:47):
decisions of sovereign rulers. Also, it was apparently not so
plainly impossible to advance the money for On April first,
eighteen nineteen, this third loan was also granted, and the
prince received the money he wanted. Scarcely. Two years later,
the elector died, His son succeeded to the government and
to his father's great possessions, and the Rothchilds had their

(24:09):
money repaid in full with all interest do A far
reaching political development now diverted the firm's attention from such
minor loan transactions, concentrating it exclusively upon the higher politics
of Europe. The victorious powers had decided to meet in
a congress at a i x LaChapelle, there to establish
new relations with the France of the restoration, as well

(24:30):
as to discuss the question whether the armies of occupation
should be withdrawn an alleviation granted for the indemnities to
be paid. England and the Eastern Powers were still suspicious
of France, and the interest aroused by this congress was
so great that the monarchs of the Holy Alliance attended
it in person, while England was represented by the two
foremost men of the day Lord Castlereagh in Wellington. Metternich

(24:53):
meant to use this opportunity to secure the support of
the Czar and the King of Prussia for his schemes
by playing on their fears of revel allution in general upheaval.
Besides the numerous statesmen, the most prominent bankers and merchants
of Europe flocked to a I X LA Chapel scenting prey.
Most of them traveled through Frankfort and availed themselves of
the opportunity of getting into touch with the financial wire

(25:16):
pullers in the commercial center of Germany. Metinich too had
come to Frankfort on September third, eighteen eighteen, accompanied by Ghents.
Gens was his secretary and adviser in money matters, but
he was interested not only in his countries but also
in his own personal advantage. With rare candor, he notes
in his diary that in eighteen fifteen he received a

(25:37):
purse with three hundred ducats and one with eight hundred
ducats from Russia, and that Prussia had given him an
Austrian civil servant eight hundred ducats and two hundred gold
napoleons as a gratuity. He was also quite open about
the fact that the Jewish banker Lammel had given him money,
and that parish had given him a share of the
Austrian loan of May eighteen eighteen. Gents called such transactions

(26:00):
pleasant financial dealings. His way of referring to them is
so candid that one gets the impression that the circumstances
of those times prevented his being in the least conscious
of anything improper in such gifts. Prince Medinich came into
contact with all the local magnates at Frankfort, including Bethman.
He seems not yet to have met Rothschild personally at

(26:21):
this time, but this defect was more than made good
by his right hand man, Frederick Vaughan GenZ. The brothers
Rothschild were well aware of the great influence that Gense
exerted upon Medinich in matters concerning the state finances, and
threw him upon the minister of finance, Count Stadion. They
knew also that Gense was bribeable, whereas they naturally did

(26:41):
not venture to approach Medinich in such a way. Amskill
Meyer and Karl Rothschild therefore called on GenZ immediately after
his arrival. This visit resulted in verbal agreements of a
financial nature, and they also requested him to use his
influence with the Prince towards securing his support in the
question of the Frankfort Jews, for at that time the
Senate was attempting to dispute the competence of the Diet

(27:03):
to deal with the Jewish problem, arguing that it was
a purely local matter. The pressure brought to bear by
the Rothschilds upon Ghens and threw him upon Medinich resulted
in the Senate's objection being disallowed and a commission of
the Diet being appointed to mediate between the two parties.
This decision, taken on September tenth, eighteen eighteen, moved the

(27:24):
Brothers to call on Gens again on September twelfth and
to engage his interest by a further detailed exposition of
the whole matter. Gent suggested that Hardenberg should have his
attention called to the subject again, as he would meet
Mederinich at a i x Lachapel and would be able
to discuss it with him. The Brothers needed no pressing
to do this and wrote to Hardenburg in the following terms,

(27:47):
Your Highness's gracious sentiments toward us, as well as your
well known tolerance in matters of religious opinion, gives us
reason to hope that you will graciously grant this letter
your favorable consideration. The question at issue is the final
decision in the matter of our position as citizens. This
is a most important question for us now, since the
welfare of those who confess our faith depends upon it

(28:09):
and is constantly occupying our thoughts. We are exceedingly anxious
not to let pass the opportunity of the meeting between
Your Highness and His Highness. The Prince Vaughan Metdenik to
ask that he should come to a final favorable decision
regarding our destiny, and we await his decision in confidence.
In venturing to appeal as strongly as possible to Your Highness,
we hope that it may be vouchsafed to us to

(28:31):
look with confidence to the future. During the sixteen days
which Ghenes spent at Frankfort, the brother's rothschild very frequently
came to see him. He was invited to dine with
the Rothschilds at five o'clock on September twenty second. Frauhurs
and General Volzovin being among those present at the dinner.
Amshkill made no slight effort to have distinguished people at
his table, But as Johann Schmitt, Mayor of Bremen, stated,

(28:55):
it was not in accordance with contemporary customs and manners
to admit a Jew to so called good society. No
Christian banker or merchant of Frankfort had yet invited a Jew,
not even one of the Rothchild brothers to dine, and
the delegates to the diet did not do so either. However,
several people were beginning to depart from this tradition and

(29:15):
accepted invitations from the Rothschilds, either from an absence of
prejudice or from motives of personal interest. Gence arrived at
a i X LaChapelle September twenty fifth, a few days
after Medinich. A brilliant society had met in that city
for the Congress. Besides monarchs and statesmen, it included financial

(29:35):
magnates such as Bearing in Hope, who were negotiating the
French loans in connection with the payment of the war indemnity.
The firm of Rothschild had sent two brothers to a
I X Lachapel, Solomon and Karl. The latter was accompanied
by his bride, the beautiful and intelligent Adelhyde Hers, whom
he had married on September sixteenth, so that his business

(29:57):
journey to the Congress coincided with his honeymoon. In the
case of the House of Rothschild, even the most important
personal considerations had to yield to important business and to
such a unique opportunity for forming extensive new connections. Through Ghents,
Metdterinich was brought into actual touch with the two brothers
at a I X LaChapelle. Gense fell completely under their influence,

(30:19):
and his diary constantly records their visits. On October twenty seventh,
Solomon handed him eight hundred ducats, which he stated he
had won by speculating for him in British funds. On
November second, Gens again records pleasant financial dealings with Solomon,
and on November twelfth, the brothers, together with Ghense and Parish,
lunched with Metternich. In spite of his heavy work in

(30:43):
keeping the minutes of the Congress, Gens spent the whole
of the next day working on a memorandum stating the
case for the Jews of Frankfort, no doubt, in return
for financial considerations, he called upon Karl's young wife, who
was highly flattered to be waited upon by the secretary
and confidant of the man who was playing the leading
role in the illustrious assembly. At the Rothschild's request, Gents

(31:05):
supported doctor Buchholtz, whom the Jews had sent to a
i x Lauchapelle to secure a favorable decision. Even if
this proved fruitless, the European Areopagus was at any rate
led to view the question in dispute from a friendly angle.
The Congress broke up on November fourteenth, eighteen eighteen. Its
conclusion brought profit to the House of Rothschild, although the

(31:27):
principal parts among the bankers had been played not by
them but by bearing in Hope. The Rothchilds, however, took
over bills from that firm. They had successfully put forward
the demands of small princes, and above all, through ghentst
they had obtained a profound insight into the activities of
the men who were the determining factors in European politics. Moreover,

(31:49):
they had formed in valuable connections for the future of
their house, and more especially, they had made the closer
acquaintance of Metternich, the most powerful man in Europe at
the time. The brothers therefore left Aix la Chapel in
a state of high satisfaction. Gens was no less satisfied.
He had been widely complimented for his work during the

(32:09):
Congress and had collected two orders as well as six
thousand ducats. He also attached great value to having taken
part in the most instructive conversation with the most powerful
men in the commercial world, while the intimate secrets of
the greatest financial dealings that have ever been transacted between
men were negotiated in his little room. It is true
that Gens liked to see himself in a romantic light

(32:32):
and was wont to exaggerate anything with which he had
to do. But the negotiations at Aix Lachapel as to
the manner in which France should pay the two hundred
and seventy million francs of war indemnity still outstanding, did
in fact constitute a formidable financial transaction. Metterinick returned home
with his sovereign, but Gens returned at the end of
November via Frankfurt, where he spent about a week. His

(32:54):
diary shows that the first week in December eighteen eighteen
was spent in almost daily visit its to or from
the Rothschilds and in long conversations and discussions with the
members of the banking family. Hour after hour, Gainst worked
in favor of the Jews of Frankfort. To this period
must be attributed the conclusion of the agreement that was
so profitable to both providing the Rothchilds with an important

(33:17):
source of political information and a connection with Metternich, while
enabling Ghenst to carry on his extravagant manner of life
and to indulge in his expensive middle aged de mour
with Fanny Elsler. The relationship continued until his death. From Frankfort,
Gainst proceeded home via Munich, where he received a letter
from his friend Adam Tiller. The public had learned something

(33:39):
of the part played by the brother's rothchild during the
past critical years, and GenZ had told Tiller Moore. Tiller,
as a result, suggested that his friend describe in a
short sketch the rise of the House of rothschild Gins
replied as follows. I was delighted with your idea of
a monograph on the Rothschilds. It is one of the
brightest and most happy notions that I have heard for

(34:01):
some time. The word is all the more appropriate since
the Wrothchilds really do constitute a special species plantarum with
its own characteristics. They are vulgar, ignorant Jews, outwardly presentable
in their craft. They act entirely in accordance with the
principles of naturalism, having no suspicion of a higher order
of things. But they are gifted with a remarkable instinct

(34:24):
which causes them always to choose the right, and of
two rights the better. Their enormous wealth they are the
richest people in Europe, is entirely the result of this instinct,
which the public are wont to call luck. Now that
I have seen everything at close quarters, Bearing's most profound
reasoning inspires me with less confidence than the sound judgment
of one of the more intelligent Rothchilds. For among the

(34:46):
five brothers, there is one whose intelligence is wanting in
another whose intelligence is weak. If Bearing in Hope ever fail,
I can state with confidence that it will be because
they have thought themselves cleverer than wrothchild and have not
followed as oafs. I am writing to euconnomoy about these
people and their business because they were my recreation at
a i x Lachapel, and at the same time I

(35:08):
learned a great deal from them. These remarks of Genses
are valuable because they occur in a confidential private letter
to a friend. We shall see later how differently Gens
was to speak about the same Rothschilds in a work
destined for publication, for which he received a princely fee
from the family. While the International Congress temporarily brought the
three brothers Amskill, Solomon and Karl into the foreground, James

(35:32):
in Paris and Nathan in London had not been inactive.
Nathan in particular had succeeded in carrying on his activities
in dealing with large loans, and had issued twelve million
pounds of English state loan. This business does not itself
appear to have brought much profit to the firm of Rothschild,
but it secured its prestige in the eyes of the
British Treasury and demonstrated to the whole world that, in

(35:54):
the face of native competition, it had maintained its position
as the banker of England, a nation which, now after
Napoleon's overthrow, was rejoicing in its undisputed political power and wealth.
James in Paris was in constant close association with Barbier,
the chairman of the Austrian Liquidation Committee. In that city.
He continued his efforts in rivalry with other firms to

(36:17):
secure the handling of the war indemnity, and so extended
his business. While the House was thus prospering throughout the world,
its existence was suddenly most seriously threatened in the hometown
of Frankfort. The family had just lost one of its
best friends there, the man to whom must properly be
ascribed the important part of having first held the latter
on which the House of Rothschild had climbed to such heights.

(36:40):
On August third, eighteen nineteen, while sitting at his desk
in Hanau, Beterus had a stroke. A short glance at
the papers which he left shows that he had spent
his whole life in meticulous devotion to the exacting work
of accountancy. The son of a poor schoolmaster, he had
risen to the rank of Privy Councilor and head of
the treasure. He had acquired a fine estate and was

(37:03):
possessed of about one and a half million gulden. All
this was, however, a trifling reward when one considers the
services he rendered to the elector during the Napoleonic period
and the enormous portions of the Elector's possessions. He rescued
his devotion to duty had not made him popular, for
he was reproached with having acted with too great harshness

(37:23):
in the Elector's interests. Vaughan Carlshausen seems to have realized
this at the end of his days, and there is
a suggestion of self justification in the concluding sentence of
his will, which reads as follows. I have done what
was in my power to provide for my dear children.
I have considered no sacrifice and no effort to be
too great where the furtherance of their happiness has been concerned,

(37:46):
and my whole life has been a consistent endeavor to
place their welfare on a firm foundation. God has blessed
my efforts, and you, my dear children, hearken to and
follow a father's last council. Guard carefully the property which I,
with God God's help, have industriously acquired. It is burdened
neither by the tears of the oppressed, nor by the
curses of the defrauded. Endeavor to increase and secure it

(38:10):
through economy, order, industry, wisdom, clemency, and piety. Shun greed
and usurious avarice. That blights all virtue have naught to
do with unjust acquisitions. Always remember that contentment is the
crown of riches. The House of Rothchild owed an infinite
debt of gratitude to the dead man. It is true

(38:32):
that under the contract he had had his share in
the business, and to this fact indeed he owed the
greater part of his wealth. But this was of small
account in comparison with the services which he had rendered
in excluding all rival firms from the rich elector's business,
and with the possibilities which he had created of applying
the Elector's money to consolidate the credit of the banking
firm and to secure its great business. It was in

(38:54):
its native town that the rise of the house had
aroused the greatest envy and hatred. Rankfort police report of
that time gives a fairly good picture of popular feeling
in the old Imperial city. The occasion of a day
of penitence. The report runs being held to commemorate a
big fire that occurred at Frankfort a hundred years ago,
through which four hundred houses were destroyed, clearly brings out

(39:17):
the feelings of the Christian inhabitants against the Jews. According
to the story, much property is supposed to have been
stolen by them. In general, any opportunity for showing envy
and ill will is welcomed, all sense of justice being forgotten.
Although many rich Jews are a source of substantial income
to Christians, any right thinking person will condemn the fact,

(39:39):
for instance, that a caricature ridiculing his ennoblement was recently
pinned to the door of the Jewish banker Rothschild at Frankfort. Rothschild,
although he indulges somewhat in display, provides many people with
an opportunity of earning money thereby, and is exceedingly benevolent
to the poor, whether they be Christians or Jews. The
capacity of this Jewish commercial and banking firm is shown

(40:01):
by the fact that it has taken over a loan
for England of which we have just been informed. It
is noteworthy that the firm of Rothschild secured the business
in competition against others. A few days ago, the firm,
on receiving a special message from Vienna, bought fifteen thousand metalliks.
The price of Austrian securities immediately rose, and the stockbrokers

(40:21):
got extraordinarily busy. The revelation of the firm's power had
the most exaggerated results. In such a highly emotional period
as Germany was passing through, A rapid development of this
kind was bound to have a particularly exasperating effect upon
contemporaries and rivals. All thinking people in Germany were greatly
stirred by the desire for freedom and national unity. On

(40:45):
March twenty third, eighteen nineteen, a fanatics dagger cost Katsubu
his life because of his attacks on the National Party.
The emotion, artificially held in check by Metternich everywhere vented
itself upon the Jews. Ourse called unser voker our neighbors
was played throughout Germany, which, to the uproarious applause of

(41:06):
the spectators, ridiculed the manners and customs of the Jews.
The author was unknown, and everybody said that the House
of Rothschild had offered a reward for his discovery. In
August eighteen nineteen, the conferences of ministers over which Mettinik presided,
met at Karlsbad to decide upon the notorious measures against
any movement of liberation. The resulting excitement found an outlet

(41:29):
in a violent outbreak of popular passion against the Jews.
Weiersburg was the first town in which acts of violence
were perpetrated. The populace gathered together in groups which marched
past the Jews houses, smashing windows and breaking down doors.
They began to loot. Hep hep down with the Jews

(41:51):
resounded through the streets. Similar scenes occurred in Bamberg and
other towns. The Jews of Frankfort were all the more
dismayed by these occurrences, as there have been menacing signs
of a similar movement developing in that city. Amskill Meyer
Rothschild and his two brothers, who, on account of their wealth,
were likely to be the principal object of any attack,

(42:12):
began to feel that their lives were seriously threatened and
to consider the question of flight. One of the brothers
seems to have spoken of their intentions to an Austrian official,
for writing on August sixth a secretary of legation that
Frankfort reports as follows. I have the honor tentatively to
inform you that I have learned from a reliable source
that the Jewish banking firm of Rothschild here intends to

(42:35):
leave Frankfort for good. They are going to apply through
the Imperial Minister of Finance, Count Vaughan's Stadion for permission
to settle in Vienna. Their intention is still a close
secret here. When they give effect to it, it will
cause an enormous sensation both among the municipal authorities and
in the whole business community, and the splendor of Frankfort
will be considerably dimmed. It will probably serve to heighten

(42:59):
the bitter feeling again against the Jews, and the departure
of the Rothchilds will be a fatal blow to them.
Frankfort soon caught the contagion of the anti Jewish disturbances
in the other cities of Germany. They were all the
more likely to culminate in deeds of violence in that city,
since the populace knew that in its hatred of the Jews,
it enjoyed the sympathy of the highest authorities in the town.

(43:20):
The occasion for the outbreak was a trifling one. On
the evening of August tenth, eighteen nineteen, some youths walked
through the Jewish Quarter provocatively shouting hep hep. Several Jews,
who happened to be standing at their doors joined to
drive the youths out of their street and beat one
of the brawlers who had fallen into their hands. Thereupon,

(43:41):
the rumor spread through Frankfort like lightning that a Christian
had been killed by the Jews. Crowds collected instantaneously and
moved shouting through the Jewish Quarter, breaking up windows and
shops with stones. The house of the Rothchilds was also attacked,
and all their window panes lay scattered about the streets.
The family had had to take refuge in the back room,

(44:02):
where they listened trembling to the threatening shouts of the mob.
On the morning of the end, the words hep hep,
the slogan for driving out the loathed jew were inscribed
in large letters at all the street corners. Thereupon, several
wealthy Israelites left the inhospitable town of Frankfort, and the
brothers Rothchild nearly followed their example, as the disturbances increased,

(44:25):
the Senate began to be alarmed that the Jew baiting
might develop into a general rising. The available troops were
called up to hold the excited populace in check. Moreover,
the delegates to the Diet, feeling particularly concerned about the
attacks on the House of Rothschild, which had important financial
connections with most of the governments represented at the Diet,

(44:45):
demanded that countermeasures should be taken. A general resolution of
the Diet was proposed requiring the Senate to take strong
measures to protect the security and property of the Jews.
Count Bull would certainly have been acting in accordance with
the wishes of Prince Szmetternik in pressing energetically at any
rate on behalf of Austria for such measures to be

(45:05):
taken by the Senate. Bohle, however, who was hostile to
the Jews, hesitated and waited for instructions. Not so the
Prussian representative councilor of Embassy Himley. On the very morning
of August eleventh, he gave a most worshipful Council of
the Free City of Frankfort to understand that he had
the fullest confidence that the Council would take the most

(45:25):
appropriate measures for punishing the attack made upon the house
of the Royal Prussian Commercial Advisers Meyer, Amskill, Vaughan Rothschild
and sons, and would assure their persons and property adequate
protection against similar risks in the future. Himley added, the
undersigned kindly requests the earliest possible information regarding the measures
which an honorable Council have taken in this matter. The

(45:48):
mayors Metzler and Vaughan Yusemer replied that the disturbances in
the Jewish Quarter had immediately subsided, and that the Senate
had taken the strongest measures to prevent their recurrence. The
Senate added to this statement that the protection of the
laws extended to all the inhabitants, and therefore also to
the merchant's Rothschild, and that the events of the previous
night would be reviewed most strictly. And the ring leaders

(46:09):
punished this read well but bore little relation to reality.
For although actual attacks upon the houses of the Jews ceased,
the hatred of their inhabitants had come into the open,
and this kept the Jews in a state of anxiety.
James in Paris had heard with great alarm of what
had occurred at Frankfort, and had urged his brother to
leave his home. You will have read in a public

(46:31):
press he wrote to David Parish at Carlsbad, how on
the night of the tenth of this month, mobs collected
in the streets of Frankfort and poured forth threats and
imprecations upon the Jewish community. Prompt measures on the part
of a praiseworthy Senate have scattered the ring leaders, and,
according to the last reports I have received, have restored order.
You can readily imagine that such occurrences are as unpleasant

(46:53):
as they are unexpected. Nowadays. What can be the result
of such disturbances. They can have the effect only of
causing all the rich people of our nation to leave
Germany and transfer their property to France and England. I
myself have advised my brother at Frankfort to shut down
his house and to come here. If we make a start,
I am convinced that all well to do people will

(47:15):
follow our example. And I question whether the sovereigns of
Germany will be pleased with a development that will make
it necessary for them to apply to France or England
when they are in need of funds. Who buys state
bonds in Germany, and who has endeavored to raise the
rate of exchange. If it be not our nation, has
not our example engendered a certain confidence in state loans,
so that Christian firms have also taken heart and invested

(47:38):
part of their money in all kinds of securities. The
Jewish community in Germany is not allowed to learn the
various crafts, so that there is nothing left for them
to do but to become dealers in money on a stocks.
A man generally has the greatest confidence in the securities
of the country in which he lives. If the peace
of the rich in Germany be disturbed, they will find
themselves forced to emigrate for their safety, and they will

(48:01):
certainly not take any interest in the funds of a
country where their life has been obviously endangered. The object
of the agitators at Frankfort seems to have been provisionally
to collect all the Israelites into a single street. If
they had succeeded in doing this, might it not have
led to a general massacre? In that case, would the
public have had any scruples about plundering their houses? I

(48:23):
need not point out to you how undesirable such an
occurrence would be especially at a time when our house
might be holding large sums for the account of the
Austrian or Prussian court. It seems to me to be
really necessary that Austria or Prussia should devise measures to
be applied by the Senate at Frankfort for energetically dealing
with occurrences such as those of the tenth of this month,
and thus making each man secure in his possessions. I

(48:47):
am sure you will be so good as to speak
to His Highness Prince Mednik about this matter, and your
friendship for me makes me feel confident that you will
appeal to him strongly on behalf of our nation. I
am informed that her Vaughan Bethmann was particularly conspicuous among
those who endeavored to restore order. The advice which James
gave from abroad did not take into account the important

(49:08):
interests that would have to be sacrificed if the firm
that was so deeply rooted in its native city, where
it was the center of an intricate network of business connections,
were to change its headquarters. The brothers who were resident
at Frankfort did certainly consider the question of leaving the town,
But when order had been restored, they gave up the idea.
For the time amschkill Meyer, as head of the firm,

(49:29):
was tied to Frankfort, but in Solomon and Karl, who
were freer to move about, the events at Frankfort had
produced a certain uneasiness which made them inclined to welcome
any future opportunity for settling elsewhere. Baron Vaughan Handel attentively
noted the results of the Jewish disturbances. Some rich Jewish firms,
such as Ellison and Speyer did actually transfer their headquarters

(49:52):
to the Hessian town of Offenbach close by, and a
persistent rumor was maintained that the Rothschilds would follow them.
The great and rich House of Rothschild, Handel reported to
Metternich is supposed to be not entirely averse to the
idea of leaving here, and if they should do so,
they would probably take up permanent residence in Paris or London,
where they already have branches. The question suggests itself whether

(50:15):
it would not be in our interests to offer them
the prospect of a good reception in the Eye and
Are States, and to induce the house to emigrate to Vienna.
This report was communicated to the Committee of the Treasury
dealing with Commercial Affairs at Vienna. The next day another
letter from Handel arrived stating that the inclination of the
Rothschild banking firm to leave Frankfort was becoming more and

(50:37):
more marked. The Treasury Committee for Commercial Affairs transmitted these
to the Ministry of Finance and the Interior for their
information and observation, adding that amskil Vaughan Rothschild spend one
hundred fifty thousand golden on his household alone, and that
he gave twenty thousand golden a year to the poor.
The Committee were of opinion that the firm of Rothschild
was at liberty to apply to be received in the

(50:59):
eye and our states. Count Stadion thereupon wrote the following
to the Minister of the Interior, Count Sorou. The President
of the Treasury Committee, has informed me in the enclosed letter,
of his intention to invite the Frankfort firm of Rothschild
to settle in Vienna, and also of the means whereby,
subject to my agreement, he proposes to prepare the way

(51:19):
to this end. The settlement of the House of Rothchild
within the Austrian dominions would without doubt be of great advantage,
and the proposal is therefore deserving of every support. Although
Hoffrat Vaughan Handel's letter does not suggest that the House
have expressed any desire to emigrate to the Austrian dominions,
it merely raises the question whether an effort should be
made to induce them to do so, as the reception

(51:42):
of the Jewish families was a matter that concerned the
Minister of the Interior, Stadian referred the suggestion to him
with the request that he approve it. Count Sorow sent
his reply direct to the President of the Treasury Committee,
conveying his decision to Stadian, in the form of a
copy of that letter, which read as follows. I venture
first to call your Excellency's attention to the fact that

(52:04):
it is still quite uncertain whether the firm of Rothschild
intends to leave Frankfort. Still less, may we infer from
the reports any clearly expressed preference for settling in Vienna.
It would seem, indeed exceedingly doubtful whether the House of
Rothschild would choose for permanent residence a place where its
principle would in view of his religious persuasion, be subject

(52:25):
to more restrictions than in any other state. Your Excellency
must be aware that foreign Israelites may reside here only
on obtaining the special Toleration permit, which cannot be issued
until they have duly received the provisional authorization for wholesale trading.
The Department is not competent to make an exception to
the eye and are regulations regarding this matter, and its

(52:47):
action would be limited to approving the request of the
House of Rothschild for permission to reside if submitted. In
view of the complicated conditions which are not likely to
attract the House of Rothschild, it would seem especially dissease
desirable to avoid any step that suggested an invitation and
to leave it to them to apply, since special exceptions
can be made only with the personal approval of the Emperor. Meanwhile,

(53:10):
your Excellency may rest assured that we are far too
well aware of the advantages that would in many respects
a crue to the Imperial State of Austria through the
settlement of such an eminent firm within its borders, not
to advise His Majesty most emphatically to give his consent
as soon as a formal or definite application in this
matter is received. Handel was accordingly instructed that if the

(53:30):
House of Rothschild made inquiries at the Legation, he was
to indicate that they should submit an application. In any case,
the report of the Department revealed that it desired the
House of Rothschild to emigrate to Vienna. This was all
the more remarkable as the position of the Jews in
Austria was far from being an enviable one. They had
not the right of owning land in any part of

(53:51):
the Imperial dominions. Law and custom excluded them from administration
and the courts, from the practice of the law and
from the teaching profession, from all all higher posts in
the army, and for many political functions and offices. They
were restricted in the matter of marriages, They had to
pay poll tax and report themselves to the Jewish Office,
and foreign Jews were allowed to remain in the country

(54:13):
only for a short period. Such were the circumstances in
which the highest officials in the State of Austria were
trying to induce a foreign Jewish family to settle in
the country, but that family was enormously rich its financial
influence was immense, and money overcame all other considerations. Soon
a Rothschild house was to be established in Vienna too.

(54:36):
Frankfort was becoming exceedingly uncomfortable for the Rothschild family. The
brothers were constantly receiving anonymous threats. One letter informed them
of the day on which Amshkll was to be murdered
by a secret society formed for the purpose of driving
the Jews out of Frankfort. In spite of all this,
the firm continued to carry on its business undisturbed, the

(54:57):
Austrian side of it particularly developing with the health of
Metternich and Stadion. Austrian affairs were chiefly left to Solomon.
In mid July of that year, the firm of Rothchild
had undertaken jointly with Gunded to arrange for the transfer
from Naples of large sums of money which that kingdom
had owed Austria since the intervention of eighteen fifteen. Also,

(55:18):
sums to the value of about three million francs payable
in satisfaction of Austria's claims upon France, were transmitted to Vienna,
the firm of Rothchild receiving one percent of the payments effected. Finally,
the brothers had heard from a confidential source in Milan
that there was an amount of money in the state
treasury Thar which the government wished to transfer to Vienna.

(55:39):
They immediately offered to carry this out. It involved a
transmission of two million lira in gold coins, and Solomon,
who was again staying at Vienna, quickly got into personal
touch with the treasury in order to discuss the best
means of sending this sum from Milan to Vienna through
exchange operations. The firm of Rothchild stated that they would
undertake the transfer were of any somewhatever, at the cheapest

(56:01):
rate possible, and that they could arrange the business to
the greatest advantage of the Imperial interests. For this service,
they and the firm of Gaunted received one half per
cent commission and one eighth per cent brokerage, so that
for the simple transmission of the money from Milan to
Vienna they received twelve thousand, nine hundred thirty three lira
in gold. Their extensive transactions necessitated of aluminous correspondence, the

(56:25):
rapid transmission of which was a difficult problem under the
primitive conditions of those times. It was not only that
posts were slow and far between. There were special dangers
attached to the postal service because the contents of correspondence
was not treated as inviolable. A large part of Germany
was still served by the Thurn and Taxis post bureaus,

(56:45):
which were divided into lodges and non lodges according as
their officials were or were not, the confidential agents of
the Viennese cipher Service. If a letter came to a
lodge office, it was carefully opened before being sent on
read through, and any important pass messages were copied. As
these intercepts, as they were called, were always laid before

(57:05):
the authorities. Such action, often abused, was greatly feared. Even
Count Stadium did not hesitate personally to invent intercepts in
order to ruin persons who were a nuisance to him.
Sometimes the couriers themselves intercepted letters in transit. Such inspection,
Bethmann wrote, on the occasion of a visit to Vienna

(57:26):
is inevitable, and Rothschild and Parish are as little able
to avoid it as her Vaughan Gamieler, although the latter
enjoys the full confidence of Prince Medernik Solomon Rothchild yesterday
told me that his brother had recently again received three
letters from him in one day. The brothers Rothchild naturally
thoroughly understood the position, as they had a great deal

(57:48):
to say to one another that they did not wish
anyone else to hear, and also attached great importance to
the speedy receipt of news in advance of normal methods.
They decided to have their own system of couriers. They
would be remm burst for the heavy expense of this
arrangement at one stroke if their firm thereby received early
news of any political event that might affect the exchange.

(58:08):
An example of this occurred when the Duke of Berry
was murdered. The Duke was the nephew of the King
of France, and as Louis the eighteenth had no children,
the hopes of the Bourbons were centered upon him. As
he was leaving the opera on February thirteenth, eighteen twenty,
he was assassinated by a political fanatic who thought to
save France by exterminating the Bourbons. According to Handel's statement,

(58:31):
the Rothchilds heard of this long before anyone else. They
made appropriate arrangements for themselves and then made the event known.
This resulted in an immediate fall in all state securities
and produced general consternation. The courier system was at first
inaugurated between the three brothers in London, Frankfort and Paris.

(58:52):
When the business with Austria accumulated and Solomon's visits there
grew more and more lengthy, the couriers extended their route
to include the Austrian representatives in London, Frankfort and Paris.
Being in constant communication with the House of Rothschild, soon
realized that reports could be more speedily sent in this manner,
and as remarks on, numerous documents showed, frequently entrusted the

(59:16):
Rothchild couriers with the most important and secret letters, without
considering whether the Rothchilds might turn the tables and themselves
intercept the state communications. This certainly cannot be proved, but
it is highly probable for on one occasion when the
brothers intrusted a letter to an ambassador, the letter was
immediately perused. Proof of this is furnished by the following

(59:38):
two letters. On November twenty eighth, eighteen nineteen, Handel reported
as follows to Metternich, the banker Karl Vaughan Rothschild, who
left for Vienna to day, asked us to put several
letters to various German ministers meeting at Vienna, which he
had been asked to take with him in a packet
and seal it with the embassy seal so that he
could bring them over the frontier without risk. I made

(01:00:00):
no difficulty about acceding to the request of her Vaughan Rothschild,
who like other Jews, is exceedingly timid, but is a
person of sound character. Because this favor made it possible
to see the contents of the letters, Rothschild duly sent
them to me, and although I had not time to
peruse them, all I was able to scan the more
important The other letter was from l'umnnier, the Secretary of

(01:00:22):
Legation at Frankfort, to the director of the Secret Service
Department at Vienna. It ran as follows her Rothschild no doubt.
Amskill Meyer, whom I often meet at Count Bowles as
well as at Baron Vaughan Handel's as, asked me to
allow him to send his letters to his brother in
my bag. I did not raise any objection, as I
did not think it advisable to refuse. But I venture

(01:00:43):
to suggest that you should inform the Secret Service Department
of this fact, so that they may look out for
these letters and intercept all those under my address. It
is not at all unlikely that the brother's rothschild, who
must be credited with a reasonable amount of intelligence, sometimes
deliberately had letters sent through the MS in order to
put them in possession of facts which had been invented
or adapted for definite purposes. The financial position of all

(01:01:07):
the states which had been engaged in prolonged military operations
much needed to be set in order now that peace
and tranquility had returned in Austria. Stadian was dealing with
this problem in collaboration with Metternich. Metternich was personally concerned
to see that Stadian was profitably occupied in the financial
matters to which he had been sidetracked. When the Chancellor

(01:01:28):
succeeded to the Foreign Office, his rival would then feel
that he had plenty to do, and the financial strengthening
of the monarchy would assist the policy of the Chancellor.
There were thus two men controlling the destinies of Austria
who were well disposed to the Jews in general and
to the House of Rothschild, in particular in eighteen sixteen,

(01:01:48):
in addition to the interest bearing state debt, there was
an almost equal amount of paper money in circulation, which
was worth a quarter less than its face value. Stadian's
efforts were directed toward preventing any further fall in value
through the issue of loans and other measures, such as
the founding of a national bank. The Metallik's Loan, so
called because the interest on the bonds was payable in

(01:02:10):
precious metal, constituted a beginning. Stadian was in agreement with
Medinich that the House of Rothschild should always be treated
with consideration politically, with a view to inducing it also
to participate in a loan. Since these were Medinich's plans,
it is not strange that he should have been much
irritated by the anti Jewish attitude of the city of Frankfort.

(01:02:31):
Frankfort was described as a center of unrest in the
reports from the delegates at this period. This was quite
enough reason for Meterinich, who scented revolution and upheaval everywhere,
to feel displeased with that city. He accordingly intervened to
prevent the diet from leaving the settlement of the Jewish
problem to the municipal departments Medinich and Stadian also decided

(01:02:53):
to accede to the request made a year and a
day previously that Nathan should be appointed consul in London.
On in March third, eighteen twenty, the Emperor gave his
formal sanction in this matter. The ambassador in London, Prince
Vaughan Estrahazi, was instructed to inform Nathan of his new
sphere of activity and to encourage him, through friendly advice

(01:03:14):
and any other suitable means, to carry out his duties
in the manner which the State expected. Official instructions were
simultaneously sent to Nathan in London, informing him, not merely
that he should duly carry out the duties imposed upon
him by the Eye and her embassy Hut, that he should,
without waiting to be asked, regularly convey to them any
information he received regarding events that might directly or indirectly

(01:03:36):
affect the government's policy. On Metanik's instructions handle the Minister
at Frankfort had in November eighteen nineteen entered into negotiations
with Rothschild for the Big loan that Austria wanted to
place with the firm. Since that time, the distinctions and
favors already described had with deliberate intent, been accorded to
the House of Rothschild. Nathan now had a position in

(01:03:59):
the Consular Corps the British capital, a fact which was
exceedingly evaluable to him, both socially and in business. He
was able to give Amskill powerful support in his struggle
for the rights of the Frankfort Jews. The ground had
thus been well prepared for a favorable reception of the
Austrian loan. The National Bank required about fifty five million

(01:04:19):
golden in order to withdraw the paper money from circulation.
On April fourth, the Emperor had authorized the Minister of
Finance to issue the loan, which, in accordance with Stadian suggestion,
was to be done in two parts. On April seventh,
the first twenty million golden were, in accordance with Solomon's suggestion,
issued to the firms of Rothschild and Perish in the

(01:04:40):
form of a lottery loan, a method which was still
unusual at that time, and which never failed of its
effect upon the general public. Nothing was said at the
time of the negotiations that were already in progress for
the issue of a further thirty five zero zero zero
golden loan, and everyone subscribed to this loan in the
confident belief that it would be the only lottery loan
for the time being. The conditions were very oppressive to

(01:05:03):
the Austrian state, although the redemption of the loan extended
over quite a long period. Under the agreement, the state
had to repay in all thirty eight million in return
for the twenty million then advanced. This naturally produced an
adverse opinion in the general public, which was ignorant as
to the general financial position in Stadian's intentions, and had
only these figures to go upon. A contemporary police report

(01:05:27):
states that the announcement of the Rothchild lottery loan had
had a very bad effect upon public sentiment. The government's credit,
when it had scarcely begun to recover, was appreciably lowered
as far as the Rothschild loan is concerned. The report continued,
I feel a genuine difficulty in deciding where to commence
with my description of the exceedingly unfavorable impression made by

(01:05:48):
this financial operation, not only upon the Viennese public, but
also upon the inhabitants of all the provinces. It would
not be in accordance with the modesty due from one
in my position to record the heart USh expressions used
by the opponents of this measure in describing it as
a monument of frivolity, caprice and self interest, indeed as
being an immoral transaction. There have probably not been such

(01:06:12):
numerous critics and opponents of any previous financial operation. I
heard a guest at an at home exclaim this loan
is one of the most wicked things that have been
done at the expense of our pockets for twenty years,
and that is saying a great deal. One thing generally
felt about this loan is that the manner in which
it was made public inevitably made it unpopular from the start.

(01:06:34):
To notify the inhabitants of a state that twenty million
were being borrowed from a foreign jew for which thirty
eight million, very nearly double the amount would have to
be repaid, is regarded as treating one's subjects as beneath contempt.
It is felt that the announcement of the loan in
the Wiener' Ziding amounted to the finance ministers saying I
am well aware that your expenditure, being greater than your income,

(01:06:55):
you have not enough money to pay your taxes now.
In order that in future you may be still less
able to pay them, I shall still further limit the
amount of money in circulation and therefore your income. In
return for this benefit, you will have to pay thirty
eight millions to the Jew Rothchild. The writer of this
report emphasized the fact that there appeared to be no
conceivable excuse for excluding the public from participating directly in

(01:07:19):
such an advantageous financial speculation as the lottery loan, and
for putting it in the hands of a foreign Jew.
Citizens were being compelled to purchase the lottery bonds from
foreign Jews at a premium of from ten percent to
eighteen percent. I am assured by bankers here. The report
continued that the profit which the contractors have made out
of this loan is enormous. To the four millions granted

(01:07:42):
them by way of commission. Must be added what they
will realize through the sale of the bonds, which they
do not issue at under one hundred gulden. The Wrothchild,
who is living here himself, admits that this profit will
increase from year to year, and that he hopes the
bonds will rise to two hundred by the second drawing
and to four hundred by the tenth drawing, and this
is not at all unlikely, since Rothschild is holding back

(01:08:05):
the sale of the bonds, thereby increasing his chances of
a tremendous gain. The whole transaction is felt to be
a shameful Jewish swindle arranged between the Rothschilds and the
Crown Agent Joel. The latter is supposed to have persuaded
the Minister of Finance, or rather his department, to agree
to it, and in return Joel or Jolson is alleged

(01:08:25):
to have received one thousand bonds, Count Stadion two thousand
and Burgermeister, the Secretary of the Treasury five hundred. I
personally regard all these statements as slanders without any foundation.
The feeling about the loan was so bitter at first
that a proposal was made among all ranks of society
to form leagues, the members of which should pledge themselves

(01:08:46):
not to take bonds exceeding the value of one hundred
gulden from the Rothschilds. There were other critics who did
not deny that Stadian's intentions were honest, but gave him
to understand that they believed the Minister of Finance had
been hopelessly done. The figures contained in this police report
somewhat exaggerated the facts, but expressed the feeling of the
public that enormous profits had been made out of this business.

(01:09:10):
In spite of the declared boycott, there was an extraordinarily
brisk demand for the Rothchild lottery bonds. The offices were
literally besieged with applicants, and the bond soon rose to
know one hundred and twenty one hundred fifty and even higher.
The Augsburg Aldemina Zeidem had published articles by Ghents and
other agents of the Rothschilds, which, under the title financial

(01:09:33):
Letters recommended that exceptionally favorable lottery enticed by these developments.
Stadian decided, in accordance with the authorization which he had received,
to issue the further thirty five million golden Four months
after the first loan, Rothschild and Parish paid out thirty
five million gulden of convention currency in cash in twelve
monthly installments in return for acknowledgments of indebtedness. The terms

(01:09:58):
were such that the state would have to to repay
seventy six million, eight hundred twenty one thousand, five hundred
fifteen golden as capital and interest in return for the
thirty five million golden which it had received. In addition,
the state paid a commission of four percent, amounting to
one million, four hundred thousand golden. These conditions, which were
approved by Emperor Francis, made the loan one of the

(01:10:20):
most lucrative transactions of the time for the firm not
merely exploited the public's gambling instincts to sell the bonds
at a good price, it also influenced the rate of
exchange through its connections with the principal burses. It was
obvious that the Rothchilds would have to reckon with the
fall in the price of the twenty million issue as
soon as it became known that a further loan of

(01:10:40):
thirty five millions was to be made so soon afterwards.
But before this was made public, they had placed the
original issue at a price well above par, so that
when the second loan was issued, the earlier bonds were
almost all in other people's hands. There was naturally, at
once a storm of indignation against the enterprising bankers, but
the first issue soon recovered, and the bonds of both

(01:11:02):
issues were eagerly sought. The public indignation subsided. The Austrian
state had its millions in cash, and the Rothchilds remained
an undisturbed possession of their profits. The negotiations necessitated by
these important and extensive transactions had made essential the continuous
presence in Vienna of a member of the Rothschild house.

(01:11:22):
The discussions were carried on almost exclusively by Solomon Rothschild,
although he was acting in concert with his brothers. This
enormous business, however, required constant personal attention in its further
stages also, and it was therefore necessary for Solomon to
try to obtain some permanent pie to terra at Vienna.
The laws of the country did not allow a foreign

(01:11:44):
Jew to buy a house of his own, and perhaps
such was not his original intention. The firm did not
yet contemplate establishing a branch similar to those in London
and Paris, although this was done eventually as the result
of its intimate association with the finance and policy of Austria.
Solomon Rothschild had taken up his quarters in one of
the leading hostelries of Vienna, known as the Hotel of

(01:12:06):
the Roman Emperor number one Rangase, it had some of
the most distinguished visitors at that time, including the King
of Wurdeenberg in the year eighteen twenty. This was the
only hotel with a large concert room, and its acoustic
properties were excellent. Beethoven often gave recitals there and occasionally
he stayed, it is supposed at the Roman Emperor Solomon

(01:12:29):
lived at the hotel until he was given the freedom
of the city of Vienna. Eventually, it is true he
was the only guest in the hotel, for he occupied
all the rooms. In the end, he bought the building
as well as the house next it, number three Rngeas.
This is still in the possession of the family, while
an insurance company acquired what was once the Roman Emperor Hotel. Meanwhile,

(01:12:53):
Metternich's confidence in the firm of Rothschild had increased. The
family perceived this, and when they saw any these signs
of big business, they would let him know through Gainst
that they would like to carry it out. James had
learned in Paris that the Allies had decided in eighteen
fifteen to put aside twenty million francs of the Paris
wore indemnity for the erection of a fourth Confederate fortress

(01:13:14):
on the Rhine. James in Paris and Solomon in Vienna
immediately offered to send this money to Frankfort so that
the Diet might have it available in current coin at
their headquarters. Metternich was unduly attracted by the firm's offered
to transmit the funds without charging commission or anything for expenses,
and overlook the profit to be derived on the rate
of exchange. He therefore decided jointly with the Prussian Secretary

(01:13:38):
of State, that this business should be carried through by
the firm of Rothschild. The two brothers, by a concerted arrangement,
each made an offer that if the money were left
in their hands, the one in Paris would pay three
and a half percent and the one in Vienna would
pay three percent until the building work on the fortress
actually commenced. That might be a long time yet, as

(01:13:59):
indeed events proved. Barbier observed in this connection in a
letter to Boll that in carrying out Metternich's instructions, he
had arranged that the Diet should retain the right to
demand security for the twenty millions from the House of
Rothschild if this sum were deposited with them. The House
of Rothschild, he wrote, is undoubtedly one of the richest
and best established firms in Europe. But we thought it

(01:14:21):
wiser to take this precaution, as over twenty million francs
are involved, which may be on deposit with them for
quite a long period if the construction of the new
fortress should be still further delayed. Thus, while the government
itself paid five percent for ready money, it left this
large sum on deposit with the firm of Rothschild at
three and a half percent interest for an indefinite time.

(01:14:41):
The banking firm got the advantage of this unexpectedly cheap
money just when important political events in the South of
Europe threatened to disturb the peaceful atmosphere that had been
prevailing since the Congress of Vienna. The liberals in Spain
had forced the promise of a constitution from King Ferdinand seven,
who had been reinstated there. Civil war continued in that country,

(01:15:02):
while the victory which the liberals had one infected the
excitable population in other lands similarly oppressed. Revolution broke out
in the Kingdom of Naples, where the nationalistic aims of
the Secret League of the Carbonari had affected wide circles
of the population. On his restoration by the Austrians in
eighteen fifteen, King Ferdinand I, an upholder of the principle

(01:15:23):
of absolute autocracy, gladly accepted Medinich's condition that he should
make no concessions to the liberals and should govern in
accordance with the Metinick system. Now, however, that he was
threatened by popular rising, he yielded all along the line
and made the ring leader General Peppe, commander in chief,
and pledged himself to a constitution on the Spanish model.

(01:15:45):
A similar movement was making progress in the island of Sicily,
where the king's ministers had to make way for new
men who were popular with the Carbonari. One of these
ministers was the brilliant Luigi Cavalier de Medici, who managed
to maintain order in the finances in spite of the
extravagances of the ruling family and the privileges of the
nobility and priesthood. Medinich, who was watching over Europe like

(01:16:08):
a guardian angel, resented any signs of resistance to his
principle of legitimacy. He had been deeply disturbed by the
news from Italy, which was within Austria's sphere of interest.
If the revolutionary spirit should spread from Naples to the
north and infect the territories that were under Austrian dominion,
there was no saying what the results might be. He

(01:16:29):
saw that his political system, his influence, which already extended
through the whole of Europe, and the very existence of
all the old legitimatest monarchies were endangered. He felt that
every effort must be made to meet this peril, and
summoned another conference of monarchs to consider the point. The
conference met at Tropas in October eighteen twenty to discuss

(01:16:49):
the principles to be applied if revolutionaries tried to impose
changes in the form of government anywhere in Europe. The
congress was moved to Libach and Medinich arranged that the
King of non Naples should be asked to attend. Scarcely
had the king crossed the frontiers of his revolutionary country
before he forgot all the concessions he had granted to
the people, and assured the envoy of the Eastern Powers

(01:17:11):
that they had been wrung from him by force, and
that he loathed constitution and carbonarism. The Congress decided in
January eighteen twenty one, in spite of the objections made
by England and France, to restore order in Ferdinand's kingdom
by occupying Naples. Medinich had succeeded in a masterly manner
in gaining over the Czar. To his point of view,

(01:17:32):
it is a matter of indifference, he stated to that monarch.
Whether the word be Buonaparte or the sovereignty of the people,
they are equally dangerous, and must therefore both be resisted.
The Neapolitan revolt and everything connected with it must be
completely stamped out, or else the powers themselves will be destroyed.
Metternich concentrated absolutely on his one great political object, the

(01:17:55):
overthrow of revolution. The troops and money necessary for this
pro had to be forthcoming, and it was up to
generals and financiers to see to the ways and means.
The news of Medinick's plans, involving as they did, heavy
additional expenditure, came as a severe shock to Stadion, who
had done so much to put Austria's finances on a

(01:18:15):
sound basis. He saw the edifice, which he had spent
rears to erect, shaken to its foundations. The revolutions had
also affected the courses and state securities were foul l
i in g in Price. Metternich, however, succeeded in being
so convincing through his influence with the press and the
passionate communications sent by him from Libach, that even those

(01:18:38):
who had reason to be alarmed about their property became
adherents of Medinick's plans of armed intervention. In Naples. The
Chancellor had inquired of Stadian as to how the money
could be found and whether Naples would subscribe to a loan.
Stadion sent the following confidential letter in reply. Even our financiers,
led by Rothschild and Parish our anxious to to see

(01:19:00):
our troops across the p at the earliest possible moment
and marching on Naples. I have ridden to Count Vaughan
Mercy regarding the Neapolitan loan. I suppose you have spoken
only to Rothchild about it. I have never mentioned it
to Perish, because I do not know how far Rothchild
wants him to come into such a business. Parsect j

(01:19:20):
and Esaus and Combian rothschild woodmeans to Louis Dawn on
peril affair. In any case, it is essential to lay
our plans carefully so that the money does not merely
come in at one door to go out of the other.
As Stadian considered the matter more closely, he began to
feel distinctly uneasy. In normal circumstances, the deficit for the

(01:19:40):
year eighteen twenty one would have amounted to eight million gulden,
but very heavy additional sums of money were now required
for the expeditionary force to Italy, and the greater part
of this cache would have to be found immediately. As
Stadian came to consider the heavy demands made upon the
treasury by Mednick's policy, he felt a growing sense of bitterness. Medinich,

(01:20:01):
the Chancellor, whose financial ideas did not extend much beyond
a general realization that a state no less than a
private individual must have money, carried out his policy without
any consideration of the cost. Stadian was expected to produce
the necessary funds as if by magic, and he really
was at a loss how to do it. The Chancellor
advised Stadian to see the Rothchilds and urged him to

(01:20:24):
discuss with the brothers the means for raising the amount
necessary for the campaign. The emigrant Jews from Frankfort had
suddenly become the sheet anchor for Austria's two leading statesmen,
one of whom exercised an influence upon the destinies of
Europe extending far beyond the boundaries of the Imperial dominions.
While at Libach, Medinich had asked Count Nesselrode, the Russian

(01:20:45):
Minister for Foreign Affairs, who was just about to leave
for Vienna, to urge Stadian to ask Solomon Rothschild to
come himself to Libach and express his personal opinion their
regarding the issue of loans to Russia and Austria. The
Chancellor also wrote a letter to Solomon Rothschild on January
twenty ninth, eighteen twenty one, making this suggestion. But Solomon

(01:21:06):
was not prepared to leave Vienna at a time when
the political situation was such that prices on the Bourse
were fluctuating violently from day to day. He therefore wrote
the following letter to Count Nessel wrote, Your Excellency, with
reference to the business matter under consideration, I venture most
respectfully to observe that a discussion on this matter at Libach,

(01:21:27):
and my presence there might give rise to numerous and
probably highly inaccurate newspaper reports. Persons with base motives would
unearth the fact that alone to the most gracious of
monarchs was being discussed. Rumor would be piled upon rumor,
and this would not be at all agreeable in the
highest quarters. For this reason, I submissively venture to suggest

(01:21:47):
to your excellency and Finance Minister. Count Vaughan's Stadion agrees
with my proposal that the business be negotiated here with
our Finance minister. My continued presence here would dissipate all rumors,
while everything would be carried on under the strictest seal
of secrecy, and the business could be transacted in peace
and quietness. Solomon Rothschild sent a similar communication to Count

(01:22:09):
Stadion at the same time, and the Count immediately wrote
to Metternich to say that, in his opinion, Solomon's contention
that neither he nor any other banker should go to
the Congress at Libach was absolutely sound. In addition to
the arguments which he has brought forward, he wrote, I
submit that the following points have to be taken into consideration.
The loan in question, which ought to cover the costs

(01:22:31):
of the expedition, can be only a Neapolitan loan guaranteed
for the greater secu or it t y of the powers.
It can be prepared under these conditions, but its formal
conclusion must take place in Naples after our troops have
entered the city and occupied it. Until that moment, the
public must know nothing whatever about it, for the loan

(01:22:51):
would go very badly if we were only like the
person in the fable offering the bear's skin, and it
could be issued only on very unfavorable terms. It would
immediately suggest that we were in lack of money, which
fortunately is not yet the case, but the mere belief
that we would seriously damage not only our credit but
our political position generally. Rothschild is here able to control

(01:23:13):
his business and his correspondence from the center, and day
by day, in collaboration with our finance department and his
business friends, to decide upon the steps or transactions that
seem to him appropriate to prevailing conditions. He cannot carry
on his work effectively anywhere but here, while it is
only here that we can examine the means that he
adopts to carry out the wishes and intentions of the governments.

(01:23:35):
These means must be brought into harmony with our general
system of credit. Since the loan is destined ultimately to
find its way into the Austrian treasury, I feel myself
compelled to observe that, whatever view one takes of the situation,
Austria alone will have to bear the burdens of the
military operations until Naples is occupied. When we get there,
it appears to me that the three following matters will

(01:23:57):
have to be dealt with. First, our troops will have
to be entirely maintained by that country. Secondly, we shall
have to obtain compensation for the costs otherwise incurred through
their stay in the Kingdom of Naples. And Thirdly we
shall have to obtain an indemnity that will partially make
good our advances. Rothschild believes that if the sum exceeds
the luw ought not to be too heavy one million

(01:24:20):
pounds or about twenty four million francs, this could, so
to speak, make a good fortune in London. I have
not yet gone far enough into the matter to be
able to judge how far his hopes are well founded.
At the same time, Solomon wrote the following letter to Metternich,
Your Highness was graciously pleased to send me your command
of the twenty ninth Ultimo. Although it gives me great

(01:24:42):
pleasure to show my zeal in fulfilling your Highness's wishes
at all times, and happy though I always am to
wait upon you, I feel it my duty to avoid
doing anything which would attract attention. A journey to Libac
at this time would arouse such attention and would give
rise to all kinds of conjectures. Ever devoted to your
Highness's commands, I beg to remain in deepest respect, your

(01:25:05):
Highness's most obedient servant. S. M. Vaughan Rothschild. Stadian's letter
had revealed the whole plan that was to be carried out.
Naples was to pay everything, and Rothschild was to arrange
loans at the expense of that country, the proceeds of
which were to be applied for paying for Austria's unwanted intervention. Meanwhile,

(01:25:26):
things had begun to move. The Austrian general Fremont crossed
upon February fifth, eighteen twenty one, with forty three thousand
men and began to march on Naples. Solomon Rothschild perceived
with satisfaction that Austria's statesmen were dependent on him for
finance and saw the prospect of realizing substantial profits. He

(01:25:48):
accordingly hastened to play sums at their disposal, with a
view to securing the possible business at Naples entirely for himself.
Stadian wrote to Metternich, Rothschild and Parish, who had, apparently
against Rothschild's wishes, been informed of this affair by Ghentes
are provisionally offering to make me advances and to transfer
sums direct to Naples. Apart from the loan. Rothschild is

(01:26:11):
already concluding agreements in Paris and London for this purpose,
or at any rate he says he is. A week later,
Stadium wrote saying, for some days Rothschild has been affecting
transfers of money to one or several banking firms in Naples,
and by the time we get there, about three million
francs will be available. These can be immediately placed at

(01:26:31):
the disposal of our government. I only wish that I
could always be informed of the requirements in good time,
so that I could make the necessary arrangements Until the
day before yesterday nobody asked for a single golden of
cash for the whole march of our troops from the
to the Neapolitan frontier. And then a courier arrived demanding
an urgent credit of two hundred and fifty thousand golden

(01:26:52):
at Florence. It seems to me that this should have
been foreseen and provided for a long time ago. Fortunately,
roth Child has money and credit everywhere, and he was
therefore able immediately to provide me with the advance I wanted,
as well as an additional advance of one hundred thousand Gulden.
Stadion was already relying largely upon the house of Rothchild,

(01:27:13):
which rendered that statesmen the most welcome services in his embarrassment,
although certainly not without cherishing the hope that they would
be duly rewarded. The Finance Minister had sent Medernick a
detailed scheme regarding the contemplated Neapolitan loan I am awaiting.
He wrote to the Chancellor your reply to my last
memorandum regarding the Neapolitan loan, so that I may carry

(01:27:35):
the matter further with my friend Solomon Rothchild. It is
absolutely impossible for him to travel to Naples and he
is asking one of his brothers to come over from
Frankfort and go on to Naples. This brother is expected
by the end of the month. He has also written
to Paris to say that a confidential servant of his
firm by name Salacy, who is thoroughly familiar with Naples,

(01:27:57):
should proceed there without delay. Finally, Stadium complained that he
no less than the public, had been kept completely in
the dark for ten days regarding the progress of events
and the present position of the troops. Solomon had realized
that it was absolutely essential that a member of his
firm should go to Naples. It was not exactly pleasant
to go there, as there was a revolution in progress

(01:28:19):
and the Austrian troops would have some hard fighting. Nevertheless,
Solomon summoned Karl, the only one of the five brothers
who so far had no independent spear of his own.
Karl had since his youngest days been accustomed to making
long journeys on his father's business. Now, at the age
of thirty three, a promising field for his activities was
offered him, Although it was in a country that he

(01:28:41):
had only once casually visited and the language of which
he did not know. This however, did not affect the matter,
for it seemed to be a merely provisional arrangement, and
Karl Little guessed that Naples would come to be his
permanent place of abode. On March first, Karl Rothschild arrived
at Vienna from Frankfort and immediately called on Stadian. A

(01:29:02):
little rothschild brother. Stadian reported to Metternich has just arrived
here on his way to Naples. I am engaged in
working out with the two brothers the most important conditions
regarding the loan which they will issue. I hope to
send young Rothschild to Libac Wednesday, or at the latest
next Thursday. You will there be able, my dear Prince,

(01:29:23):
to inform him whither he should then proceed. I hope
that it will be to Naples, and that you will
have occasion to send him as speedily as possible. On
March sixth Karl did in fact go to Liebach. Stadian
was hoping that in the course of its advance, the
army would acquire a few millions for the Austrian treasury,
which was sadly in need of them. I have to

(01:29:45):
point out he wrote that the declaration of war by
Naples without a shot having been fired, a sufficient ground
for us to declare our right to indemnity from the
date when our troops crossed the pal Meanwhile, the Austrian
army was approaching the Abruzzi, which was the easy this
territory between Austria and Naples for the enemy to defend.
Its march was somewhat delayed through the insufficiency of provisions

(01:30:07):
and of money. Count Ficklmont, who was accompanying the army
on his way to take up his duties as ambassador
at Naples, wrote, we are all suffering acutely from the
disastrous shortage of money. Application was made at Rome to
Torlonia and other banking firms, but in Vain a stirring
appeal was made by Medinik with a view to remedying

(01:30:28):
these evils. On receiving a report from Vienna, Medinich had
published a statement regarding the whole expedition in order to
pacify the Viennese public, who did not understand what business
Austria had in Naples. Count Sedlnitsky welcomed this step, wishing
the Chancellor luck in carrying on his policy on the
grand scale, and reported through an arrangement made in the

(01:30:50):
nick of time by the thoroughly worthy house of Rothschild
and other firms regarding Wertheimer's failure. The market here has
been saved from being flooded with Metalik's bonds, and a
rise in their value, as well as in that of
other state securities, has been effected. This has had an
excellent effect upon public opinion in the middle classes and
in the business world. The Minister of Police considered the

(01:31:12):
critics and malcontents to be especially numerous among so called
men of learning, and even in several higher circles and
in the army. Nevertheless, he wrote, we may count ourselves
fortunate if we compare public sentiment here with that in
other countries. Stadion, however, who was constantly receiving applications for money,
was not equally satisfied. He viewed the future with dismay

(01:31:36):
and was utterly at a loss to see how he
could provide the money for everything that was being done.
He suddenly heard that a general had stated during the
court ball that the Emperor had recently commanded the pay
of the Neapolitan Expeditionary Force to be increased and a
new recruiting law to be carried into effect, which would
add almost one hundred thousand men to the strength of
the army. I was absolutely overwhelmed with surprise, he wrote

(01:31:59):
in a li arm to Metternich. By this news and
by the manner in which I learned it. If this
is true, it will involve a permanent additional expenditure on
our armies of more than ten millions. I have not
got this money, and I see no prospect of getting it.
Things cannot go on like this. I feel that I
have already reached the utmost limit of what is possible.

(01:32:22):
It is very easy to send out handbills, but in
order to translate them into reality, the Emperor must find
a man who can feed fifteen thousand men with five loaves.
I cannot refrain from protesting against the way things are
being done. His majesty does not allow himself to spend
even two hundred florins on his gardens. He does not
sanction a pension to save a poor family from hunger

(01:32:44):
without sometimes consulting me several times in the matter. And
now we are to have an additional expenditure of ten million,
which it is difficult to justify. So far from consulting
me in fixing this sum, which is far beyond anything
we can possibly raise. It was not even thought worth
while to inform me of the decision. In such circumstances,

(01:33:05):
my position, which I have always regarded as the great
misfortune of my life, has become quite impossible. For years
I have been refused the means of putting things straight,
But at the same time I am regarded as an
inexhaustible source of money. I am required to fill the
glass at any moment it is put before me. Such
a method of proceeding certainly puts an end to my

(01:33:25):
responsibility in the matter. Even if, after all the other
sacrifices I have made, I cast aside the last shreds
of any respect that I may enjoy in the world,
this will not bring additional revenue to the monarchy or
save it from financial disaster. I write to you to day,
my dear Prince, in the bitterness of my heart. It

(01:33:45):
is difficult to remain calm under such conditions. Besides, I
feel it to be my duty to state the unvarnished truth, when,
as in the present instance, the truth is of such importance. Farewell,
my dear Prince, make such use of this letter as
you think fit. In some such mood as this, Stadion
wrote too memoranda regarding the general financial position of the country,

(01:34:09):
and sent them to Metternich. The problem is, he submitted,
how to save at least some part of our existence?
I cannot possibly conceal from you any longer that I
am weighed down and oppressed by a load of misfortune.
I have reached the point when I fear that any
day I may find that I am quite impotent and
helpless to do any more work. I will carry on

(01:34:30):
with the strength that remains to me until I drop.
But do not expect any great services from a man
who is weakened as I am. The Finance Minister's panic
left Metternich unmoved. Clear. Before him lay the path that
he had recognized as the right one and had ruthlessly followed.
He was determined not to deviate from it until he

(01:34:51):
reached his goal. We have embarked upon a great undertaking,
one that contains the possibilities of greater results than any
of our times, he wrote to General Count Vaughan Bubna.
It is great, for upon its success or failure, the
whole future depends not merely the future of the Austrian monarchy,
but that of the whole of Europe. It was impossible

(01:35:12):
for us to take any other action, for it is
a matter of life or death. Everything now depends upon success.
I hope that one or two hard blows will decide
the issue. If not, the result will be the same
as if we had ventured nothing. The revolution will engulf
first Italy and then the world. I will spare no

(01:35:32):
effort until I am killed myself. Meanwhile, farewell, I shall
not see you this year, but I shall certainly see
you next year, unless the world has been destroyed. While
Metternich was using proud words such as these, he was
being besieged with the most urgent requests from the army
to furnish money for its innumerable needs. In the meantime,

(01:35:53):
Karl Rothschild had arrived at Libach and had called on Ghentz,
who immediately informed his princely master of Young Rothschild's arrival.
Medinik asked Karl, through Ghents whether he would be prepared
to travel in his service and whether he was able
without any loss of time, to make payments to the army.
The Chancellor also desired to know how monies could be

(01:36:15):
speedily and safely conveyed to Rome. Karl replied as follows,
I have the honor to reply to your Princely Highness's
gracious inquiry of to day that I am prepared to
undertake the journey at once to any place where your
Princely Highness may bid me go, and to do everything
in my power to see that the payments which you
have graciously commissioned me to make to the army are
carried out with the greatest possible speed and precision. If

(01:36:38):
your Princely Highness will most graciously inform me what sums
and at whose disposition you wish them placed in Rome,
I will then send a special messenger to instruct Senior
be pack Card, a member of a firm who is
in Milan, to transfer any sums required to Rome without delay,
and if necessary, to travel there himself. I have only
to add, with all humble respect, that we will, on

(01:37:00):
this occasion, as always use our endeavors to satisfy the
wishes of His Majesty, which indeed is always our sole aim.
Karl Meyer Vaughan Rothschild, who thus came into prominence, was
personally the least gifted of the five brothers. He had
little talent for adapting himself to his environment, had an
awkward manner, and was overstrict in his observance of the

(01:37:21):
religious practices of an Orthodox Jew. His principal asset was
a pretty and intelligent wife, who won everybody's affection and
thereby made people forget many of her husband's errors. In
spite of the distance which separated them, Karl remained at
any rate in really important transactions under the control of
his brothers James and Solomon. Meanwhile, the Austrian army had

(01:37:45):
advanced almost without a battle. The encounter at Rietti was
just a small skirmish and was described by Ambassador Count
Ficklemont as the most ridiculous thing he had ever seen.
Our advance is uninspiring, he reported, as we are completely unopposed,
but our political victory is all the greater. Everything therefore
seemed to be proceeding satisfactorily, when a very bad piece

(01:38:07):
of news was received after his return, King Victor Emmanuel
had inaugurated a severely reactionary regime in Piedmont. For example,
he made the possession of a certain amount of property
and necessary qualification for being allowed to learn to read
and write he had the botanical gardens at turn destroyed,
and wanted to destroy the marvelous bridge over the Pe

(01:38:28):
simply because they were the works of Napoleon. He naturally
opposed all nationalistic movements among young people. The risings in
Spain and Naples were accordingly joyfully welcomed in Piedmont. When
the Austrian troops started for the south, a rising broke
out in Alessandria too, the object of which was to
secure a constitution and the abdication of the autocratic king.

(01:38:52):
The news of these events caused dismay at Liebach. The
assembled diplomats were like a swarm of bees that has
been disturbed. Gens reported, this unexpected news is a very
hard blow to me and to all of us. I
remained with the Prince until half past four, in a
kind of stupor, and then I tried to eat something.
Rothchild came to me in a state of great emotion.

(01:39:14):
I had enough sang froid to be able to calm him.
Karl Rothschild was just about to start for Italy in
accordance with Metternich's wishes, and these events caused him the
most serious alarm. The impression made at Vienna was no
less profound. Stadion completely lost his nerve. The situation is terrifying,
he wrote to Metternich. Never, not even in the darkest

(01:39:38):
hours of the revolutionary wars, has an event produced such
an effect on the Vienna borse as the latest news
from Italy. If the enemy were at the gates, there
could not be more unreasoning panic. The whole of the
population of Vienna is rushing to the burst to get
rid of our public securities. Our credit, which has only
just been established, is on the eve of vanishing completely.

(01:40:01):
I shall be forced to suspend a conversion of paper
money into cash or bank notes on demand. To do
so would be exceedingly painful to me, for it would
mean destroying in one day the labors of the five
preceding years. This is the first step to our destruction.
It is impossible that alone should be considered, either at
home or abroad, at a time when our securities are

(01:40:22):
becoming worthless. Judging from the way things are going, we
shall have to give up all hope of getting any
financial assistance from Naples. There is so much popular unrest
of a very marked character, that each day may bring
a fresh catastrophe and make further desperate measures necessary. During
this period, Stadium repeatedly called in Solomon to examine the

(01:40:43):
situation with him and ask his advice. If, however, he
hoped for comfort from him, he was doomed to some disappointment.
Solomon too had suffered from the sudden fall in the
value of securities and could not himself help being somewhat
affected by the general panic. It was not until he
received reassuring news from his three brothers in the west

(01:41:04):
of Europe that he was able to take a less
gloomy view of the situation. The panic reached its height
on March twenty second. On that day, Stadion wrote again
to Medinich, describing the complications in Naples and Piedmont as
amounting to the destruction of Austria. He wrote, if all
the misfortunes that appear imminent today come upon us at once,

(01:41:24):
I must confess I see no hope of salvation. Nevertheless,
we must try to put an end to the Naples
adventure as speedily as possible, and thus at least save
the army's honor. All troops should be withdrawn to within
our frontiers and kept in readiness to meet at tax
from abroad and from the revolutionary spirit at home. Medinich
said nothing, but proceeded to set troops in motion for

(01:41:47):
quelling the revolt. It was Stadian's business and not his,
to raise the necessary money. The former had already spent
money which was earmarked for the year eighteen twenty two,
and his pronounced sense of responsibility caught caused him to
take a darker view of recent events than was strictly justified. Metdterinich, however,
infected his Imperial Master, who was staying with him at Liebac,

(01:42:09):
with his own spirit of resolute calm, and the Emperor
wrote a reassuring letter to the King of Naples. The
king had just left Liebac, having borrowed the money for
the journey to Florence from the Emperor Francis, as he
had no funds himself. While assuring the king that his
interests were identical with his own, the Emperor did not
forget about the repayment of the journey money, and issued

(01:42:31):
instructions that the cash should immediately be provided out of
the Rothschild loan, which was being planned in Naples. On
March twenty fourth, the expeditionary force had entered Naples without
encountering serious resistance. The news of this event put an
end to the rising in Piedmont. Lombardy remained quiet, and
the general information received that Libach gave reason to hope

(01:42:52):
that the whole movement would die down in a short time.
Metternich was able to feel that he had re established
his system in both countries. It was now possible completely
to reassure Karl and to persuade him that the journey
to Florence, where the King of Naples was still staying
with his retinue, was absolutely safe. Before he started on
the further journey to the capital at the foot of Vesuvius,

(01:43:15):
the Austrian troops there would have re established complete order
and security. It was on March twenty third that Gens
had made these reassuring observations to Karl Rothschild, using the
opportunity to ask for a small personal loan. Karl, who
was not so quick at appreciating Gens's influence as his
brothers had been, made difficulties, with the result that, to

(01:43:36):
use his own words, an unpleasant discussion ensued. When he
got back home, Rothschild learned that Metternich wished him to
leave for Florence on the following day. He felt some
misgivings regarding the disobliging attitude he had adopted toward the
right hand man of the all powerful Chancellor, and he
thought that his brother Solomon would be annoyed with him
if he had parted from Ghent's ill will. He accordingly

(01:43:58):
called on Ghens late that evening, in order, as the
latter put it, to make good his error. Medinich had
given Karl Rothschild a letter of introduction to the Austrian
general Baron Vincent, who was staying at Florence with the
King of Naples. The general had long known of the
Austrian government's financial intentions regarding a loan to be issued
in Naples. He knew that the Allies had agreed with

(01:44:22):
the King Atleibot that the costs of the expedition should
be borne by the Kingdom of Naples from the moment
when the army crossed the and that the cost of
maintaining the army in Naples should also be borne by
that kingdom. Medinich had sent Vincent the following instructions on
the matter as early as March first, eighteen twenty one.
The point regarding the loan is of great importance for

(01:44:42):
our finances. We wish to facilitate the work of the
Neapolitan government so that they will be able to provide
for the first needs of our army and fulfill some
of their obligations to us. Count Stadion has already entered
into negotiations on this matter with the House of Rothschild.
It is desira in our financial interests that this house
should be given the preference, and the King also is

(01:45:04):
prepared to proceed on these lines. The firm has the
necessary means at its disposal, and I therefore believe that
it will be possible speedily to come to terms with it.
It would be redundant to point out to your excellency
that the fact that Count Stadium was compelled to make
enormous advances to the Neapolitan Expeditionary Force has made him
exceedingly anxious to ensure that these money shall be gradually repaid.

(01:45:27):
He is the more concerned about this sense. If the
monarchy were to incur such a heavy loss, the resulting
financial embarrassment might produce results which nobody can foresee. Shortly
before Karl Rothschild's departure Medinik followed up these instructions with
a letter stating that Rothschild was coming only in order
to negotiate for the Neapolitan loan. Although this firm had

(01:45:49):
not yet put forward definite terms, Mednick wrote it was
desirable that the Neapolitan government should hand over to the
House of Rothschild bonds coming within the scheme of their
general system of credit at a fixed price, and leave
it to the firm to reimburse itself by issuing these
bonds at its own risk, at a price which would
yield it a profit. Should the House of Rothschild demand

(01:46:09):
a guarantee from Austria for the due carrying out of
the obligations of the Neapolitan government, Vincent was authorized to
accept such a condition if it was necessary. He was urged, however,
to ask Rothschild to put his proposals into writing and
to press for a speedy conclusion of the agreement. This
was urgent in the interests of Austria's finances in general.

(01:46:31):
He should show courtesy to Karl Rothschild and introduce him
to the Neapolitan minister, Prince Ruffo, so that Rothchild could
deal direct with him. Metternich concluded by saying, we must
naturally take no direct part in these business negotiations, but
we are very much interested in their success. The loan
is destined to cover a part of the costs of

(01:46:52):
the expedition, as well as to meet the expenses of
maintaining in paying our army. You are invited therefore, if
Her Vaughn Rothschild's first proposals are accepted by the Neapolitan Minister,
to facilitate the conclusion of their business through your good offices.
Carl Rothschild arrived in Florence on March thirty first, on

(01:47:13):
Vincent's introduction. He had a short interview with Prince Ruffo,
but he was coolly received and was not given any
explanation as to the Minister's intentions. He had to wait
for news from James, who had been requested by Solomon
to express his views regarding the Neapolitan business. Vincent advised
Rothschild to go to Naples and inform himself as to
the prospect on the spot, for Ruffo had been absent

(01:47:35):
so long that he was completely uninformed as to the
financial situation. The ambassador took the opportunity of borrowing one
thousand ducats on the government's account, the advance for his
official expenses having long been exhausted, Rothschild gladly lent the
desired amount. Although the agreements were kept secret and nobody
knew that that firm had been granted absolute priority, the

(01:47:58):
news of a loan to be issued by Naples became
known in other banking circles. A Milanese by name Barbaiah
approached Vincent and, in agreement with certain French firms, offered
to advance thirty millions to the Neapolitan government at an
issue price of sixty percent. My fear is Vincent replied
that this may conflict with our orangements with the House

(01:48:19):
of Rothschild and confuse them. Barbia was not a negligible rival.
He was already known to the King of Naples, and
was received by him in Florence on this occasion, too. Vincent,
as speedily as possible, gave Karl Rothschild precise information regarding
the offer. You will, he remarked, be in a better
position than any one else to say what value should

(01:48:41):
be attached to this offer. This problem itself, naturally did
not engage Karl's very close attention, but it was valuable
to him to be informed of his rival's plans as
speedily and accurately as possible in order to be able
to take appropriate countermeasures. On April sixth, he proceeded to Naples.
Vincent gave him a letter to Ambassador Count Ficklemont informing

(01:49:02):
the Count of the offer being made by Barbaia and
of Austria's anxiety that the loan should be entrusted to
the firm of Rothchild. The King himself did not yet
dare to return to Naples, in accordance with Metternich's instructions,
The General commanding at Naples meanwhile restrained the newly installed
government from considering loans proposed by various Italian banking firms

(01:49:23):
before Rothchild should have arrived. When he arrived on April twelfth,
Count Ficklemont immediately introduced him to the government, who informed
him that they wished to take up a loan of
twelve million ducats about twenty million golden. Under pressure from
the Austrian general, the government had ignored Barbaea's offers, although
the Milanese had brought a letter from the King of

(01:49:44):
Naples recommending him. The king had instinctively felt that the
House of Rothschild would act in Austria's interests rather than
his own, but he was king only by the grace
of Austria, and that country could call the tune. The
House of Rothschild stated that they were prepared to grant
alone of ten million ducats. They added that they would
at first make only six millions available, the balance to

(01:50:06):
be paid when they had placed the six million. The
bonds were to be issued at fifty four three percent.
Commission was to be paid, and an undertaking was to
be given that during the continuance of the agreement no
new loan should be issued. Moreover, in any future loans,
the firm was to be given the preference before any
other for sinking fund purposes and for greater security, they

(01:50:28):
demanded that the state domains should be pledged. These were
hard conditions. Public securities then stood at sixty percent, so
that the issue price was very low and all the
more favorable to the Rothschilds, as they intended to issue
the state bonds, which had hitherto been dealt with only
on the Naples burse and through their London and Paris houses,

(01:50:49):
to put them on the market in those cities. The
Neapolitan finance minister MARQUESI Dandria, considered the proposals to be
far less advantageous than those of certain Neopo firms, and
therefore entirely unacceptable. The minister was of opinion that instead
of helping the state, the conditions would be a serious
blow to its credit, since it was impossible to place

(01:51:10):
any confidence in a government that sold its securities at
such a low rate. He held that there was no
reason for selling bonds at fifty four when the ruling
price was sixty. The government was not so pressed for
money as those appeared to believe who put such proposals forward. Meanwhile,
news had been received that the revolution at Naples had collapsed.

(01:51:32):
Ficklemont summoned Karl Rothschild and told him that Austria was
desirous that the House of Rothchild should handle the loan.
The ambassador requested him not to make it too difficult
for Austria to bring the necessary pressure to bear upon
the Neapolitan government, but to moderate his terms somewhat. Rothschild
replied that his first proposals were not his last word

(01:51:52):
in the matter. He had been asked to make an offer,
and he had done so by way of opening negotiations.
The good news received from Pedeman made it possible for
him now to offer better conditions. The ambassador also asked
Rothschild to avoid, if possible, saying anything about a guarantee
by the powers. Karl promised to do what he could,

(01:52:13):
and Ficklmont assured him of his full and very powerful
support with the Neapolitan government. That government owed its very
existence to the Austrians, and it was obvious that it
would have to conclude the agreement with those whom the
Austrians wished. The ambassador at Naples had completely understood what
was in the minds of the leading men at Vienna.

(01:52:34):
If the House of Rothchild carries through a loan of
any kind, he wrote to Metternich, that fact will provide
us with the necessary security. As we have not yet
made any direct or positive demand for reimbursement of our expenses,
I did not feel that it was possible to include
in the terms of the loan any explicit condition regarding
direct payments to Austria by the House of Rothschild. Her Rothchild,

(01:52:57):
who always keeps our interests in view in the negotiation,
has therefore inserted the words in his draft terms payable
to those who shall be authorized to receive the money.
This condition will become applicable when our direct negotiations have
settled the amount to be paid to us. The ambassador
was anxious that the Neapolitan finances should be spared as
much as possible, so that there should not be any

(01:53:19):
doubt as to naples ability to pay the expenses of
Austria's expeditionary force. If the current expenses for the maintenance
of our army, Ficklemont wrote to Mettnik, can be met
out of the ordinary revenue of the state, the whole
amount of the loan could be paid into our treasury,
except perhaps the first two or three installments, which the
government will require in order to put the taxing system

(01:53:40):
in order. Shortly afterwards, the loan was issued, sixteen million ducats,
being taken up at sixty ducats for the one hundred
ducat bond. Rothschild allowed other Italian banking firms to take
some small part in it. In order to keep active
opposition down. The government pledged itself not to issue any
further loan before eighteen twenty four, and if it required

(01:54:02):
to issue further loans, to give the House of Rothschild
the preference. Karl joyfully reported the conclusion of the business
to Metternich. He emphasized that, in accordance with Metternich's wishes,
he had made no mention of a guarantee by the powers,
writing moreover, I hope that if peace only lasts for
a little while, the loan will soon be fully subscribed,

(01:54:24):
and it will not be necessary to ask for guarantees
for the balance, as in that case all state securities
will rise in value, and the Neapolitan securities will follow suit.
The plan had succeeded, and Austria had thereby put the
house of Rothschild in the saddle at Naples. This was
not done from motives of disinterested friendship, and the brothers

(01:54:44):
Rothschild paid for the privilege with Neapolitan money. Meanwhile, the
forces of reaction were playing havoc at Naples. People were
arrested in thousands. The death penalty and long terms of
imprisonment were meted out to the Carbonari and the revolutionary
off A strict censorship was also instituted. These conditions continued

(01:55:06):
after the return of the king, and as all these
things were being done under the protection of Austrian Bayonets.
The foreign troops did not gain any sympathy in the country.
All classes, excepting the conservative upper class, regarded them as
undesirable guests, and resentment against the Austrians was heightened by
the fact that they were using a clever foreigner to
force the country itself to pay for their occupation. About

(01:55:29):
this time death came to the man in whose service
the Rothschild family had grown great. On February twenty seventh,
eighteen twenty one, the Elector of Hesse had a heart attack.
With the words I shall lose this battle, he expired.
His death had nothing like the importance to the Rothschild
family that it would have had about ten years earlier,
when their transactions with the elector constituted almost their only,

(01:55:52):
and certainly their most important business. The new elector spent
a great deal of money, but he had not the
commercial ability of his father, and the relationship with the
Rothchilds was limited to casual transactions of minor importance. Amskill
at Frankfort carried on the business of making loans on
an extensive scale to princes and other important personages whom

(01:56:13):
he desired to cultivate. James and Nathan put the Neapolitan
securities on the market in London and Paris, making the
interest due in London payable in British currency, a fact
which induced many people to invest their money in these securities, carrying,
as they did a high rate of interest. The result
was that soon after their issue they rose considerably in price.

(01:56:35):
Nathan was clever at securing people's support and at getting
publicity for himself. A young clerk from the Commercial Department
of the Treasury at Vienna by name Anton Lauren, had
been sent to study in England for some months during
the summer of eighteen twenty, and was naturally referred to
the Austrian consul in London, Nathan Rothschild. Nathan showed a

(01:56:55):
great deal of kindness to Lauren, as he naturally assumed
that he would send a report home. He acted as
his mentor and invited him frequently to dinner and supper.
He was so successful in securing the young man's affection
that Lauren gave the most ecstatic, not to say extravagant
and almost tedious accounts of him. When he returned home,
he sent in such an enthusiastic report to his chief

(01:57:18):
that the latter decided to convey the essential points in
it to the Emperor, with the request that Nathan should
be specially commended. After recounting how Nathan had helped Lauren,
the President of the Commercial Department of the Treasury proceeded
to state in his memorandum to the Sovereign Lauren at
the same time reports as to the disinterested work done
by this consul and as to his efforts to be

(01:57:38):
of effective assistance to Austria's credit, industry and commerce. He
states that Rothchild waves all consular fees, actively assists Austrian subjects,
has secured a quotation for Austrian state securities on the
London Stock Exchange, helps Austrian sailors generously from his private resources.
Nathan is prepared with his own ships to establish ant

(01:58:00):
direct service between London and Triaste. He has sent a
collection of seeds of rare foreign plants for your Majesty's gardens,
as well as several articles of interest in industry and
the arts for the Polytechnic Institute, without asking for any payment.
He is still collecting models and various objects of this
kind with a view to bequeathing them to that institute.
It is not for me to express an opinion as

(01:58:21):
to the value of the services rendered to the credit
of the Austrian State by Consul Rothschild. In this connection,
I can but humbly lay before your Majesty the London
Stock Exchange Report for the sixth Ultimo, which he has
sent me. In this your Majesty may be graciously pleased
to observe that Austrian State debentures are specially mentioned, together
with their price under the designation Austrian loan. The other

(01:58:44):
efforts referred to above by Consul Rothschild for facilitating and
extending Austrian trade, the industrious and disinterested manner in which
he carries out the duties of the Consulate so graciously
entrusted to him by Your Majesty, His generous help to
unemployed Austrian sailors, and his efforts to enrich Your Majesty's
gardens and the Polytechnic Institute, deserve proper recognition. Through establishing

(01:59:06):
a direct monetary exchange on London, Rothschild has indisputably greatly
facilitated commercial and financial transactions. If he succeeds, as he
undoubtedly will, in view of the disinterested patriotism of his
aims and methods in establishing direct communication between London and Triste.
The beneficial results to our commerce will be even more marked.

(01:59:29):
Through carrying out this one conception, he will earn the
well deserved gratitude of a considerable portion of the Austrian
trading community and consuming public. I hope that your Majesty
may graciously realize from a perusal of these few lines
what an important and beneficial influence upon the trade and
industry of the monarchy. The nomination of this man as
Austrian consul is having. Our former consuls in this country,

(01:59:52):
which is so uniquely adapted to trade and industry, did
absolutely nothing for the monarchy, confining their activities to collecting
substantial fees from subjects. The newly appointed Consul Rothschild has
in a very short time done more than all his
predecessors put together. I therefore feel it to be my
duty to hiring his meritorious activities to your Majesty's knowledge,

(02:00:14):
and at the same time most dutifully to beg that
Your Majesty's satisfaction may accordingly be conveyed to him. In
his memorandum to the Emperor of March sixth, eighteen twenty one,
counts Stadion confirmed the statements of Ritter Vaughan Stahl, adding
that the Rothchilds also deserved praise for the greater facility
with which, under the existing critical conditions, the financial requirements

(02:00:35):
of the Army in Italy could be met. These two
documents were also sent to Count Zichy for his observations,
who passed them to Privy Councilor Baron Vaughan Letter, who
gave his opinion in the same skeptical vein he had
used when the ennoblement of the family was under consideration.
The alleged special services of Nathan Meyer Rothschild, he wrote,
are connected partly with his activities as Austrian consul in

(02:00:58):
London and partly with his relation to the finance departments.
If it is due to Rothschild that Austrian government securities
are quoted in London stock exchange reports, and if the
transfer of money to Italy has been facilitated through the
good offices of the House of Rothchild, it must be
remembered that the interests of the brother's Rothchild are identical
with those of the finance departments. The brother's Rothchild are

(02:01:20):
at the head of the business, which concluded the last
two loans with the Austrian Financial Administration, so that they
are clearly interested in obtaining a market for Austrian securities
abroad and particularly in London. When banking firms undertake to
remit money, they are rewarded by a commission set aside
for the purpose, and are able to profit by differences
in the rate of exchange. I would therefore attach more

(02:01:43):
importance to Nathan Meyer Rothschild's disinterested manner of carrying out
his duties as Austrian consul, and would venture immediately to
concur in the proposal that he should be acquainted of
his Majesty's satisfaction, if I did not feel that the
occasion for doing so is somewhat unsuitable. A clerk of
the commerci Department of the Treasury, by name Lauren, obtains
leave to travel to England. He has given a letter

(02:02:06):
of introduction to Nathan Meyer Rothschild, who receives him in
a friendly manner and supports him in his endeavors to
extend his knowledge in the fields of industry and commerce.
He returns full of praise of the way he has
been received, and takes the opportunity of commenting in high
terms on Nathan Meyer Rothschild's disinterested in zealous conduct as consul.

(02:02:26):
I am far from wishing to cast any doubt upon
the facts that he brings forward. But as he made
the journey purely as a private person and not on
any official mission, it was not his business to put
these facts forward through official channels and to take the
responsibility for their accuracy. In my humble opinion, the statement
he volunteered should merely have led to an inquiry on
the matter being made through the Austrian embassy, and it

(02:02:49):
seems to me that this omission can still be rectified.
The Emperor, who was not yet fully aware how deeply
leading statesmen had committed themselves to the House of Rothschild,
did indeed command and that further information should be asked
for regarding Lauren's statements that Rothschild carried out his duties
in such a disinterested manner. Ritter Vaughan Stall, however, stuck

(02:03:10):
to his guns and was particularly emphatic in pressing the
interests of the House of Rothchild, as he knew that
James and Paris desired the dignity of an Austrian consul
general for the same reasons. As his brother in London,
he suggested on March thirtieth that James should be appointed.
The highest quarters did not give any immediate decision in

(02:03:30):
this matter, but the Neapolitan Revolution occurred shortly afterwards, involving
the close co operation between Metternich and the House of Rothschild.
It was no longer thought either desirable or possible to
refuse the brothers anything, as it depended upon their attitude
whether or not Austria should recover the money spent on
the expeditionary force. Solomon gave his brother James at Paris

(02:03:52):
to understand that he should renew his application to be
appointed Consul general. For now was the critical moment, as
the Austrian government was more or less in a cleft stick.
As it was under an obligation to the House and
closely associated with it, it could not turn the request down.
James asked Solomon, as he stood so well in Vienna,
to put forward the request himself. Solomon drafted a petition

(02:04:16):
to the Emperor and handed it to Stadion, who, in
consideration of the indispensability of Solomon and his family, conveyed
it to the Emperor with the following memorandum. I venture
to support this petition which your Majesty was previously not
pleased to entertain, for the following reasons, which relate particularly
to present circumstances and to conditions obtaining during the last

(02:04:37):
few years. Your Majesty is fully aware of the highly
important services which the House of Rothchild, or more accurately,
the various Wrothchild firms established in the principal capitals of Europe,
have rendered in the complicated difficulties of the present time.
To the energy and resources of the Rothschilds, to their
tireless efforts to apply large sums of money at points

(02:04:59):
where they were immediate required to stem the tide of events,
I owe the fact that I have been able, continuously
in all places and at the right moment, to provide
what was necessary for military operations without interfering with our
internal services or the measures to restore our credit in
the precarious state of Austria's finances resulting from recent events.

(02:05:19):
It was only thus that popular feeling in the government's
credit could be maintained at the point where they now
stand through the Rothchild's clever management. The cost of the
extensive monetary movements during the military operations was low compared
with any other method of remitting money. Through the great
services which the Rothchild firms have rendered to us during
a most eventful period, their existence has become most intimately

(02:05:42):
bound up with that of the Austrian monarchy. They have
incurred the envy and hatred, and to a certain extent,
the persecution of the whole Liberal party in Europe. And
although the extent of their wealth, their firmly established reputation
throughout Europe, and their constant rectitude in business matters have
so far protected them from the consequences of malicious intrigues,
it is really essential that their services should be recognized

(02:06:05):
by our Court, and that they should enjoy the explicit
protection of Your Majesty in the principle markets of the world,
in order that they may have the necessary strength to
resist all these machinations and to continue as useful to
the monarchy in the future as they have been in
the past. This is particularly the case in Paris, as
being the headquarters of all liberal activities in Europe and

(02:06:26):
the city in whose burse the loans of all states
are handled with no inconsiderable effect upon their value. The
President of the Commercial Department of the Treasury has laid
before your Majesty proofs of what has been done to
promote our trade by the Rothschild who has been appointed
Consul General in London. Even more successful have been his
efforts to develop a market for the sale of our

(02:06:46):
securities in England and to establish arrangements for directly discounting
bills of exchange between Great Britain and the Austrian markets.
Paris is as indifferent as London to religious distinctions, and
the appointment of one of the brothers, Wroth chid Child
as Austrian Consul General in Paris should be of real
service to the commercial and financial interests of the monarchy. Moreover,

(02:07:07):
Rothchild waives the right to any emoluments connected with such
an appointment which he desires, only for the distinction attaching
to the office as being likely to afford him some
protection against the hatred and persecution of the Liberal party
in that city. There was much truth in Stadian's report.
The Rothchilds had in fact made themselves unpopular with the
more liberal section of the public abroad through the contracts

(02:07:30):
which they had made everywhere with the re established reactionary governments.
Stadian was not aware that in spite of their particularly
conservative sentiment, especially in Austria, they cultivated relations with the
other parties as well, lent money here and there, and
thus secured themselves against a political reaction such as was
always possible. The envy of other firms was increasing to

(02:07:52):
a prodigious extent as the power of their house grew
in Paris. Their position was particularly delicate for the Bourbon
king Kingdom, with the weak Louis the eighteenth and the Ultras,
who were all the more powerful, was far from popular,
and the strictly royalist Minister bellel who was at the
head of the government, was hated by a large part
of the population. The brother's Rothschild, however, had necessarily become

(02:08:17):
intimately connected with the new regime, and moreover, as the
bankers of the Holy Alliance, they were sending French gold
abroad in large amounts. James Rothschild was often the target
of veiled attacks, and once he felt actually constrained to
call upon the Prefect of Police to lodge a complaint
regarding the large number of threatening anonymous letters which he
was receiving Through being appointed Consul general. He hoped not

(02:08:40):
merely to raise his social prestige, but also to achieve
greater security under international law. It is true it was
not realized at the court either of Paris or of
Vienna that James Rothschild was in close association with the
liberal minded Duke Louis Philippe of Orleans. Afterwards King of France.
James frequently advised him in money matters, and was very

(02:09:01):
often a guest in his house. Emperor Francis referred James
Rothschild's application to be appointed Consul General to the Commercial
Department of the Treasury, with the instruction that they should
let him have their observations upon it. Ritter Vaughan Stall
did not need to be asked twice to do this.
He immediately transmitted the application to Stadion with the following observations.

(02:09:24):
England and France are by far the most cultivated states
in Europe. In them, agriculture, industry and commerce flourish in
the greatest harmony, and it is therefore most important for
us to have in their capital's commercial agents who are
experienced men and enjoy an extensive credit. As far as
commercial and industrial matters are concerned, I cannot suggest a

(02:09:44):
more suitable person for his Majesty than the head of
the Paris House, James Vaughan Rothschild, I made his personal
acquaintance during his last stay here. He is a young
man of parts who is intimately acquainted with several members
of the Polytechnical Institute in Paris and of the concer
Servitoire to Arts e t Matiers, as well as with
many of the most cultured French manufacturers and business men. Moreover,

(02:10:07):
he expressed to me his readiness, as his brother in
London had done, to cooperate in every possible way in
promoting our industry and commerce. For this purpose, he immediately
ordered some interesting machines which he is giving to our
polytechnic Institute, assuring me that he did not wish in
any way to lag behind his brother in London, in
proof of his devotion to the House of Austria. Finally,

(02:10:30):
the consideration that James Rothschild is a Jew seems, in
my humble opinion, to constitute no greater difficulty than in
the case of his brother in London. It is true
that in the decision regarding the appointment of the London
Rothschild as consul, which decision is attached to the application
your Majesty expressly laid down that it would have to
continue to be the rule that no Israelite should be

(02:10:51):
appointed consul. Yet, if the exception made by Your Majesty
in favor of the London Rothschild has proved in the
highest degree beneficial, it is likely to be no less
so in the case of the Paris Rothschild. In Paris, too,
the consuls have no specially representative character, and as under
the French Constitution, the Israelites enjoy the same rights of

(02:11:12):
citizenship as all other French subjects in France. I am
of opinion that Your Majesty may graciously permit an exception
to the rule to be made in the case of
James Vaughan Rothschild, such as you have graciously permitted to
be made in regard to the London Rothschild. While the
commercial and industrial reasons for acceding to James Vaughan Rothschild's
request are weighty, the financial considerations are still more important

(02:11:35):
this point. It is not necessary for me to labor.
Your Excellency is fully aware that since the recent crucial
events in Italy, the combined Rothchild houses have rendered far
greater services than they had rendered even at the time
when his Majesty, with your Excellency's approval, was graciously pleased
to appoint the London Rothschild to the office of Consul.
It is certainly a factor of no small importance in

(02:11:57):
the success of such vital operations to have the support
of all these wealthy firms. In conclusion, Ritter Vaughan Stall
strongly urged that Medinich should be asked to express an
opinion as to whether there was any objection to the
proposal from a political point of view, so that a
further report to His Majesty might be made as speedily
as possible. Medinick duly wrote to her Vaughan Stahl, as

(02:12:19):
all considerations of a commercial, industrial and financial nature make
it desirable to grant this application. I have to add
only that from a political point of view, there is
no reason why Solomon Vaughan Rothschild's which should not be granted.
On August eleventh, eighteen twenty one, James Vaughan Rothschild was
duly appointed Consul General in Paris. Thus another of the

(02:12:41):
five brothers had climbed a rung in the latter of
social position. Immediate payment for his Majesty's favor was required.
Since the Austrian army had entered Naples, the Neapolitan government
had met all its expenses, including pay but ten days
after so wholeheartedly supporting the petition Mederinick instruction to Count
Ficklemont in Naples to get from that government the money

(02:13:02):
that had been expended from the moment when the army
crossed the pile. The finance minister had already pressed impatiently
to be indentified for these expenses. The advances already made
were estimated at four million, six hundred and fifty thousand gulden,
and the money was to be repaid in Vienna in
six monthly installments, commencing on August first, eighteen twenty one,

(02:13:24):
Metinik sent a private letter to the Count together with
these instructions. The Ministry of Finance wrote, the Chancellor attaches
very great importance to the punctual and reliable repayment of
the monies which you are hereby instructed to demand from
the Neapolitan government, and it will not tolerate any further
excuses for delay. With this end in view, it has

(02:13:45):
concluded an agreement with the House of Rothschild under which
her wroth Child in Naples has been authorized to make
an arrangement with the government in order to facilitate these payments.
I have the honor to request you to get into
communication with Her Rothschild on this matter and to support
such proposals as he may consider it desirable to submit
to the Neapolitan government. The object of these proposals will

(02:14:09):
be to make it easier for the government to effect
a payment that might cause it some embarrassment without the
assistance of this banking firm, and at the same time
to facilitate the punctual receipt of a considerable sum of
money by our treasury, in the payment of which no
further delay can be suffered, as it constitutes a part
of our annual budget. Although he did not succeed in
arranging for the Neapolitan government to repay the whole of

(02:14:31):
this amount, Count Ficklemont managed to obtain compensation to the
extent of four million Gulden five hundred thousand, to be
payable on August thirty first, seven hundred thousand in each
of the following three months, and one million, four hundred
thousand in January eighteen twenty two. The first amount was
paid to Carl Rothschild and transmitted by him through his

(02:14:51):
brother Solomon, to the Austrian government. It had been possible
to make this payment out of existing funds, but further
payments were to be met out of the wa loan
of the House of Rothchild. Thus, part of the money
subscribed for the loan never reached the Neapolitan treasury at all,
but was made over to Austria direct by the House
of Rothschild. Although Naples bore the whole burden of the loan,

(02:15:13):
the government of that kingdom at this time made the
request of Karl Rothschild that, in consideration of certain additional advantages,
he would, if possible, make his loan payments to them
earlier than was provided for under the agreement. Rothchild agreed
on condition that he was allowed to deduct the first
two installments of seven hundred thousand gulden and transmit them
direct to Austria. Karl reported the conclusion of this agreement

(02:15:37):
to Count Ficklemont, stating, I am accordingly glad to be
in a position to give your Excellency the assurance that
the first two payments are secured, and that I shall
be making payments to your Excellency instead of my brother
making them in Vienna. Your Excellency will no doubt realize
that this was the principal reason which led me to
fall in with the suggestion at some sacrifice to myself,

(02:16:00):
For I was thus able to satisfy your excellencies wish
that the payments in question should be secured to the
eye and are treasury, and at the same time furnish
further proof that I am always prepared to make every
effort in the interest of His Majesty's service. As for
the balance of one million, four hundred thousand golden out
of the total of four million golden due in January,

(02:16:20):
I shall try to deal with this sum in a
new loan which the Royal Government of Naples intends to
issue shortly. Karl Rothschild had thus endeavored to meet the
convenience of all parties. He made it easier for the
Austrians to recover their expenses, and he paid the installment
on the loan to the Neapolitans before the agreed dates.
He himself did not do badly, for in June eighteen

(02:16:42):
twenty one, the bonds he had underwritten at sixty already
stood at seventy six and a half. The Court of
Naples had been in such urgent need of the advanced
payments on account of the loan, that when Karl agreed
to make them, he received a special letter from the
finance minister, His majesty. The letter has instructed me to
communicate to you, in his royal name, his full and

(02:17:04):
gracious satisfaction with the consideration you have shown in the
matters affecting the treasury. The king's debts to the Emperor
were also settled through the House of Rothschild by making
a deduction from the loan. The balance, so far as
it was not used in the maintenance of the Austrian army,
was not spent, either carefully or usefully. In spite of
all the loans. Therefore, the country continued to be oppressed

(02:17:27):
by financial stringency, and the Neapolitan ministers were constantly complaining
of the annual charges amounting to nine million ducats for
maintaining the Austrian army, which made any reason finance impossible.
But Austria insisted upon its pound of flesh, and Stadian's
attitude was positively petty. When Karl Rothschild transmitted the monies

(02:17:47):
to Austria in bills due in three months. The finance
minister demanded immediate payment in cash, as Naples was required
to pay the money free of all charges in Vienna.
Karl took the stand that was without his intervention and willingness,
the Neapolitan government would have been absolutely unable to carry
out the obligation it had incurred to the Austrian court
to pay four million golden so that he had felt

(02:18:10):
himself justified in adopting this method of remitting the money. Henceforward, however,
he paid in cash and simply debited the expense of
remitting the money and the loss on exchange to the
Neapolitan treasury. In such circumstances, the first loan was naturally
soon exhausted, and the Neapolitan finance minister found it necessary
to apply to Karl Rothschild for a second loan. After

(02:18:33):
lengthy negotiations, alone of the nominal amount of sixteen million,
eight hundred thousand ducats was arranged at the end of
November eighteen twenty one, which, in view of a wider
market and the resulting improvement in price, was underwritten at
sixty seven point three In spite of the fact that
the state's indebtedness had increased. When the amount of one million,
four hundred thousand golden fell due on the last day

(02:18:54):
of January eighteen twenty two, the Finance Minister himself asked
Rothschild to make the pay out of the loan, as
Naples was not able to find the money for the
support of the Austrian troops was a constant heavy burden
on the treasury. Stadian's financial program with regard to Naples
was carried through quite ruthlessly, and Medinich was able to
point out to the Finance Minister that, thanks to the

(02:19:16):
Rothchild intervention, which he had advised, the undertaking that Stadian
had so much dreaded had been completely financed by Naples.
Medinick fully appreciated the services rendered by the House of
Rothchild and was prepared, at Solomon's urgent request, to devote
greater energy henceforward to securing the eminicipation of the Jews.
Slowly but surely, the rich Jewish bankers, who had been

(02:19:39):
brought into touch by the Rothchilds with the delegates to
the diet at Frankfort, improved their social position severely, though
they had been shunned before the change became apparent. During
the first months of eighteen twenty. The Rothchilds and other
representatives of the commercial world gave big dinners, and the
bearers of the most noble names, as well as persons

(02:19:59):
in every kind of high office, were seen at their tables.
In this way, they often acquired items of news that
they could turn to account in business. Since arriving here,
the bremen Burgomaster Smitt wrote from Frankfort, I have found
to my great astonishment that people like the Bethman's, Gaunteds
Brentano's eat and drink with prominent Jews, invite them to

(02:20:20):
their houses and are invited back. When I expressed my surprise,
I was told that no financial transaction of any importance
could be carried through without the co operation of these people.
They had to be treated as friends, and it was
not desirable to fall out with them. Having regard to
these facts, the Rothschilds have been invited by some of
the ambassadors during this period. Amskil Meyer, Rothschild's wife, was

(02:20:43):
invited to a ball at the Prussian legation in Franktort.
Smit specifically recorded his opinion regarding the Rothschild family in
a report of a conversation with the delegate to the
Diet Count Boll. This House, he observed, has, through its
enormous financial transactions and its banking and credit connections, actually
achieved the position of a real power. It has to

(02:21:05):
such an extent acquired control of the general money market
that it is in a position either to hinder or
to promote, as it feels inclined, the movements and operations
of potentates and even of the greatest European powers. Austria
needs the Rothschild's help for her present demonstration against Naples
and Prussia. Would long ago have had to discard her
constitution if the House of Rothschild had not made it

(02:21:27):
possible for her to put off the evil day. Several
medium and small states have also had recourse to its
financial power in their difficulties. This puts it in a
strong position to ask for favors, especially for a favor
of such an apparently trivial nature as the protection of
a few dozen Jews in a small state. At the
end of May eighteen twenty, Metonik sent a dispatch to

(02:21:49):
the reluctant Bull instructing him to support most of the
Jews wishes in the Diet. Boll, however, was inclined to
follow out his own predilections, so that there was no
immediate change in the situation. Indeed, the Senate showed a
tendency to revert to increased harshness in dealing with the Jews. Thereupon,
Medinich firmly admonished bol to put an end to this

(02:22:10):
state of affairs, with the result that the Diet sent
a kind of ultimatum to the Senate. The Chancellor went
even further. He traveled to Frankfort himself and decided publicly
to honor the Rothschilds, there by accepting an invitation to
dine with them. He had let amshkill Meyer know this
through Solomon at Vienna, who had just come into prominence
again through an action which had one sympathetic recognition in

(02:22:32):
high quarters. The Eye and Our Court theater at the
Cartner Tour was again without a lessee, and the only applicant,
Dominic Barbaia, was unable to find the deposit of fifty
thousand golden in cash required under the terms of the lease.
The House of Rothschild stated that they were prepared to
guarantee and pay this amount to the Eye and Our Treasury, whereby,

(02:22:54):
as the document of guarantee stated, the further continuance of
an entertainment worthy of the dignity of the Imperial Court
and the capital city was assured until the year eighteen
twenty four. On his arrival at Frankfort, Medinich received the
following letter from amskill Meyer Rothschild, Most Excellent Prince, Most
gracious Prince, and Lord. I hope your Highness will not

(02:23:17):
regard it ungraciously or consider it as a presumption if
I make so bold as to ask Your Highness to
do me the gracious favor of taking soup with me
this noon. Such a favor would mark an epoch in
my life. But I would not have ventured this bold
request if my brother in Vienna had not assured me
that Your Highness did not entirely refuse his entreaty to
grant me this gracious favor. The Austrian gentlemen here have

(02:23:39):
assured me that they will also be present in such
a case. If your Highness wishes to come at another time,
please command me, for any man feels himself happy to
be in your Highness's company. Mederinich accepted the invitation, and,
accompanied by his intimate friend, Countess Levin came to lunch
with amskill Meyer, an event which did not fail of
its effect upon the diet and upon society in Frankfort.

(02:24:02):
The two burgomasters of Frankfort, although invited, did not come.
The Senate, however, was prepared to make all the concessions
asked for, except to agree to the designation Israelite citizens.
Metinich had seriously to emphasize his definite wishes to the
obstinate Bull, instructing him to act in strict accordance with them,

(02:24:23):
But the Senate remained obdurate. Bull practiced passive resistance, and
the Jewish problem remained unresolved. While making these social and
diplomatic efforts on behalf of the Jews in general and
of the Rothschilds in particular, Medinick instructed Ghens to see
that the House of Rothchild did not suffer in the
press because of the close association of that house with Austria,

(02:24:45):
which was ruthlessly repressing all liberal movements in Germany. The
more radical sections of the German public and their papers
were venturing to pass some rather hostile judgments upon the
House of Rothchild. In spite of the prevailing censorship. Gens
had repeatedly to listen to Metternich's reproach that he had
not got the newspaper sufficiently in hand. For whenever an

(02:25:05):
article unfavorable to the Rothchilds appeared in a German paper,
Solomon pressed Medinik to use his influence to prevent such
occurrences in the future. Even the Frankfort letters to the
Algeminazeidem published by the firm of Kada contained such attacks,
GenZ felt that it was his duty to intervene Sir.
He wrote on October eighteenth, eighteen twenty one, to Kada,

(02:25:29):
you will have heard from other sources that there is
again grave dissatisfaction here regarding the manner in which the
ALGEMINAZEIDM is edited. It seems to me all the more
necessary that if you are really anxious that the Algaminasiding
should continue to circulate in the Austrian States without restriction,
he should at least mitigate such offending passages as convey
the impression of hostility to Austria. I refer to such

(02:25:51):
articles as those of Frankfort origin, which have been appearing
with some frequency lately, and which comment upon the financial
operations here and the rate of exchange in Aca the
manner unfavorable to Austria and her credit. It is true
that the general sense of these articles reveals the fact
that they are directed not against our state securities, but
against the House of Rothschild. Under prevailing conditions. However, it

(02:26:14):
is obvious that the moves attributed to the House of
Rothchild always react upon our state credit and are generally
more damaging to it than to the Rothchilds, who in
such cases are well able to help themselves. On December fourth,
eighteen twenty one, Genes wrote again saying, the constant attacks
upon the House of Rothchild, invariably and sometimes in the

(02:26:35):
most outrageous manner, reflect upon the Austrian government by necessary implication,
since everybody knows they are transacting important financial matters with
that house, which is not only unimpeachable, but honorable and
thoroughly respectable. The persistent rumors regarding new loans are invented
simply and solely in order to undermine the confidence which
our public securities have won, in which they deserve. The

(02:26:58):
Aldamina Zeiem was there thereafter ban throughout the whole dominions
of the Austrian monarchy. Katta who, although no friend of
the Jews, was a sound business man, was exceedingly displeased
at this and requested Stegmann, the editor in chief, to
be more careful as ghents and they both knew well
that meant Meternik had complained bitterly about the paper. Stegmann replied,

(02:27:21):
in view of the letter from her Vaughan Ghens, which
you have been kind enough to communicate to me, I
gladly give my formal promise not to accept anything in
future relating to the value of Austrian public securities, or
anything whatever relating to the House of Rothchild, at least
as affecting its relations with Austria. This means, of course
that I shall have to adopt a new, very cautious

(02:27:42):
and colorless attitude to affairs. In point of fact, I
know nothing of any attacks against the House of Rothchild,
unless the remark that Madame Rothschild has received her first
invitation from the Prussian Minister constitutes an attack in a word.
Kata and Stegmann submitted, and for the time being the
brother's Rothschild did not have to bother much about the

(02:28:03):
very widely read Algamina's item. The zeal Ghens had shown
in this matter was not attributable entirely to Metdnick's instructions.
Since his return from Libach to Vienna, he had grown
more and more intimate with Solomon Rothschild. He often had
occasion to confer with him on behalf of his chief
regarding the Neapolitan loan, and on one occasion Medinich made

(02:28:24):
a very friendly remark to Gens regarding the attitude of
the house of Rothschild in this matter. It happened that
on the following day against met Rothschild at a dinner
given by the banker Escals at Hyatzing, and he hastened
to inform him of the remarkably flattering remarks made by
the Prince. This produced, as Gens himself records in his diary,

(02:28:44):
results most favorable able to himself. This morning, he notes,
on June twenty fourth, eighteen twenty one, Rothschild paid me
a very long visit. He told me the same remarkable
story about his money and family affairs as I had
recently heard from the Prince. At the same time, he
gave me the account of my share in certain recent
financial operations, from which it appeared that entirely contrary to

(02:29:07):
my expectations. Nearly five thousand gulden were due to me.
Gens's diary for the next few months is full of
notes of meetings with Rothschild and constantly mentions his very
agreeable communications and important financial arrangements. At the end of
the year, Rothschild specially demonstrated his gratitude for all the
information he had received and for the influence that had

(02:29:29):
been brought to bear upon Prince Medernik and the press.
Rothchild breakfasted with me ghenst notes in his diary on
December twenty second, eighteen twenty one, and gave me a
proof of real friendship for which I cannot feel too
grateful to this excellent man at a time when all
my income from the principalities has come to an end
and nothing is done by those in authority to compensate

(02:29:49):
me somewhat for this loss. Finally, Gense played his part
in bleeding the Neapolitan treasury, and Rothchild assisted him in
this matter too. On New Year Day, Rothschild waited at
Gens's house until he came back from Metternich in order
to tell him that a courier was leaving for Naples
next day. And that Gens might send an urgent reminder
regarding the gratuity promised him by the Court of Naples.

(02:30:12):
He Solomon would see that the matter was put through
by his brother Karl and General Roller, the Intendant General
of the Austrian troops. Gens and Rothschild had become positively inseparable.
The friendship certainly cost Solomon a great deal of money,
but the cost was negligible in view of the advantages
which it brought him. The restoration of the Neapolitan Kingdom

(02:30:34):
by the Austrians placed heavy burdens upon the people. Count
Ficklemont estimated that Naples had to pay twenty three to
twenty four million gulden or twelve to thirteen million ducats
for the annual upkeep of the Austrian army. He himself
was terrified at the magnitude of the amount. If the
burdens that we impose, he reported to Vienna, are so

(02:30:54):
oppressive that they are more than the country can stand,
all parties will unite in desiring our departure. Instead of
being a protecting power, we shall become oppressors. The end
of it will be that we shall not be able
to remain as long as our interests and those of
the Kingdom of Naples require. The ambassador also stated emphatically,
as he had often done before, that the finance minister

(02:31:17):
was entirely incapable, and that there was only one man
who could restore order, namely Luigi de Medici, the former
finance minister who had been overthrown by the revolution. All
the other foreign representatives were also of this opinion, but
the king feared Medici as a man whose intellectual gifts
would not accord well with his own autocratic temper. Ficklemont

(02:31:38):
discussed this matter with Karl Rothschild, and Rothschild also thought
that it was only by appointing this descendant of the
eminent Tuscan noble family, a man of outstanding honor, energy
and administrative talent, that the material recovery of the country
could be assured. Although Medici had enemies among the royal family,
such as the Duke of Calabria, to whom he had

(02:31:59):
refused to give more money for the Duke to squander
in an irresponsible manner, successful pressure was brought to bear
by the Austrian government, with the result that he was
reappointed Finance Minister at Naples. In the spring of eighteen
twenty two. The new minister did succeed with great difficulty
in getting the country out of its serious embarrassments. It
is true that not even he was able to deal

(02:32:20):
with the demands of Austria. But he proved himself a
pergnacious accountant and managed to knock down considerably the maintenance
expenses of the Austrian Army, the returns for which had
always been scaled up very generously. He contrived to make
the second Rothchild loan last longer than his incompetent predecessors
had done in the case of the first loan, But
in December eighteen twenty two he was compelled to have

(02:32:42):
recourse to a third loan, the extent of which was
twenty two million ducats nominal. Later on he raised a
fourth loan of two and a half million pounds sterling
at the rate of eighty nine and four fifths, in
order to acquire the necessary funds for paying the Austrian
Army for a further period and for covering the deficit
in US budget. Through arranging for the loan to be

(02:33:03):
issued in sterling instead of inducats, Nathan expected especially to
interest English investors and in this he was successful. By
February twenty sixth, eighteen twenty four, the loan was already
quoted at ninety six point seventy five. The public debt
of Naples, which before the revolution had stood at twenty
eight million ducats, had risen by the year eighteen twenty

(02:33:24):
four to no less than one hundred four million ducats nominal.
Yet the bonds appreciated so considerably in value that some
Neapolitan public securities stood at one hundred eight in April
eighteen twenty four. It might have been expected that as
the amount of the debt increased, these quotations would fall,
since the income having remained comparatively stationary, the security for

(02:33:45):
repayment of the debt diminished as the debt increased in amount.
The ambassador Ficklemont fully appreciated the position when he wrote,
it was therefore another's credit, and not that of Naples,
that caused the prices to rise, namely the credit of
the House of Rothschi. The value of its public securities
is therefore not a reliable basis on which alone to

(02:34:05):
found an estimate regarding a state's welfare. By so doing,
one might be gravely misled. Securities at Naples have risen
in value because a wider market for them has been found.
London and Paris have become the principal centers through which
they are sold. It has not been possible for Naples
to contribute in any way to the result. Since Naples

(02:34:27):
merely punctually paid the interest on its debt, A small
portion of the funds has found its way to Austria.
The balance, which was not placed in Naples has been
gradually absorbed by powerful banking firms in London and Paris,
which derive their profit from fluctuations in value, and have
thus recouped themselves and a great day more for the
capital sums which they have advanced. Thus briefly stated, the

(02:34:51):
financial policy of the Rothchilds in Naples was summed up.
Carl Rothschild had originally gone to Naples with the intention
of remaining their own only for a short time, as
its occupation by Austrian troops was intended to be a
temporary measure. But local conditions made it necessary that these
troops should remain in the country for a much longer
period unless by withdrawing them. Metternich was prepared to risk

(02:35:13):
having the King and his reactionary supporters driven out of Naples,
while the Austrians remained. The presence of Karl was an
urgent necessity, and his wife, who had embarked on the
journey to Naples as a pleasure trip, made arrangements for
a prolonged stay. Karl extended his business and finally contrived
to make himself indispensable to the Neapolitan court in financial matters.

(02:35:36):
He struck roots in that beautiful city of southern Italy,
and what at ar first seemed likely to be a
brief business sojourn was destined to develop into permanent residence,
and the House of Rothschild acquired a new center of
operations in the world. In spite of Stadian's efforts, through
Rothschild and military pressure to get in the money expended
in Naples, the Austrian budget had got into a state

(02:35:58):
of sad confusion. The rising in Piedmont had cost a
great deal of money, and the military expenses had attained
colossal figures. In despair, Stadion reported to the Emperor in
Medernich that the excess of expenditure over revenue was such
that there was a permanent annual deficit of at least
twenty million gulden, or more than one sixth of the
total budget. He urged the necessity for putting an end

(02:36:21):
to this disastrous state of affairs. If it were to
continue for a longer period of years, it would involve
the downfall of the monarchy. Stadian stated that another loan
to cover this deficit was urgently required, and suggested recourse
again to the House of Rothschild, whose wealth had increased
prodigiously of recent years. Morritt's Vaughan Bethmann, who was staying

(02:36:43):
in Vienna in February eighteen twenty two, expressed the following
opinion regarding the House of Rothschild. I can understand that
the Rothchilds prove exceedingly useful instruments to governments, and am
far from wishing to cast dispersions on them or from
envying them their good fortune. Solomon especially is a man
of the most estimable character, and I am exceedingly fond

(02:37:05):
of him. I have heard from a reliable source that
Solomon Rothschild has stated that the annual balance sheet of
the five brothers showed a net profit of six million
golden in twenty floor. In measure, this is certainly a case,
where the English proverb applies, money makes money. Observing their
industry and judgment, we may expect their business to continue

(02:37:25):
to flourish. Indeed, one hopes so, since the overthrow of
this colossus would be terrible. The harmony between the brothers
contributes largely to their success. None of them ever thinks
of finding fault with another. None of them adversely criticizes
any of the other's business dealings, even when the results
do not come up to expectations. Solomon has one people's

(02:37:48):
affections here, partly through his general modesty and partly through
his readiness to be obliging. Nobody leaves him without feeling comforted.
Stadian's gloomy report regarding the condition of the public finances
induced the Emperor to give his agreement to a loan
being obtained from the House of Rothchild. Rothchild was approached
in March eighteen twenty two, an amount of twenty eight

(02:38:10):
to thirty million golden being mentioned. The treasury official, Baron
Vaughan Pillersdorf, wrote a considered report on the offer sent
in by the firm. Rothschild proposed that thirty million golden
should be issued at seventy percent, so that the loan
certificates to be issued would represent a nominal capital sum
of forty two million, nine hundred and fifty seven thousand golden.

(02:38:32):
As interest was allowed to be deducted even before the
money was paid, a capital amount of forty two million,
eight hundred and seventy five thousand florins would have to
be issued. In respective cash received amounting to eighteen million,
seven hundred and eighty five thousand, seven hundred and seventeen florins.
If we compare the real underwriting figure allowing for the
deduction of interest of sixty seven percent, Pillersdorf's report continued

(02:38:56):
with the ruling price, which averages seventy five percent. We
find there is a difference of eight points or ten
and two thirds per cent in favor of the underwriters,
which would mean a profit to them of three million,
four hundred and twenty eight thousand golden. It further appears
from the above statement of the case that the interest
payable on the suggested loan would amount to seven and
a half percent per annum. The view to be taken

(02:39:19):
of these conditions, the report concluded, follows naturally from a
consideration of the figures detailed above, in my opinion, they
are exceedingly onerous and less favorable than any previous proposals.
Having regard to the fact that the first loan concluded
when Austrian credit was in its infancy, was a daring experiment,
they are unacceptable in view of all the reactions that

(02:39:41):
would result. Taking all these considerations into account, the proposals
put forward do not seem to me such as should
be accepted, even as a basis for further negotiation. It
would certainly be a severe blow to the country's credit
if it became known that, in the circumstances indicated above,
a loan had been included at the price of sixty
seven percent, especially when one bears in mind that the

(02:40:04):
Treasury would have to meet the reproach of having confined
itself to a single offer. The House of rothschild was
accordingly informed that the Treasury was prepared to carry through
a financing operation with them and perish if this could
be arranged on favorable terms, but that the proposals made
could not be regarded as such. Moreover, the Treasury wished
to take up only a small amount. The Rothschilds, who

(02:40:28):
wanted to get the business at all Costs replied in
the following terms. We hasten hereby to inform your Excellency
that we have just heard from our houses in London
and Paris that several firms in those cities have informed
them of their desire to invest capital in Austrian funds,
and thereby to participate in a loane arranged for His
Majesty's service. In view of our friendly relations with those firms,

(02:40:51):
we should be exceedingly glad to meet their wishes as
far as we can. So, we venture to inform Your Excellency,
in connection with the offer we have now now made
for underwriting twelve million golden of five percent loan, that
we are prepared, in any event to offer one and
a half percent more for the amount decided upon than
is offered by any other firm. The Rothschild sent in

(02:41:13):
a second letter on the same day, in which, together
with Perish, they endeavored to get the large loan. They
tried again to induce the Finance Minister immediately to issue
the loan on a larger scale, as they stated principally
in order that the credulous and uninstructed public should have
no occasion to believe that a similar operation would be
repeated at an early date. The letter concluded in the

(02:41:35):
full conviction that none, not even the smallest circumstance of
any significance, escapes the profound insight and business acumen of
your Excellency. We are confining ourselves briefly to indicating the
above consideration, and are content to leave the appreciation of
it entirely to your Excellency's wisdom and judgment. When the
Austrian Treasury did not accept this offer, Solomon Rothschild felt

(02:41:57):
personally aggrieved. He took his troubles to Ghentz, who had
just received a gratuity of three thousand ducats from the
Court of Naples through Karl Rothschild's interventions. Ghense reports how
Solomon described with many tears how inconsiderately he had been
treated in more than one quarter in connection with his
new loan proposals. This failure was soon compensated for by

(02:42:20):
other important transactions. Nathan had just concluded a loan of
three and one half million pounds with Prussia, and the
repercussions of this transaction were felt as far as Frankfort
and Vienna. Concurrently, there were a large number of small
loans arranged in Germany and Austria with the higher nobility
who were short of money in both countries. The loan

(02:42:42):
amounting to nine hundred thousand golden, which Prince Medernik himself
obtained from the House of Rothschild on September twenty third,
is of particular interest. It was a perfectly straightforward business.
The lone bore jive percent interest and was to be
repaid by eighteen thirty four. In fact, the Prince repasted
in full in eighteen twenty seven. There was nothing in

(02:43:03):
the least suggestive of bribery about the transaction. Medinich was
no Ghens, but it was bound to make the Chancellor,
who thus became Solomon's debtor, feel not entirely free in
his dealings with him. At all events. It had the
result that Medinich was more inclined to be sympathetic to
the personal wishes and requests of Solomon Rothschild and his brother.

(02:43:24):
The Chancellor had known for some time that the brothers
Rothchild were not content with the simple Vaughan that they
had acquired in the year eighteen seventeen, and that they
had their eye on the title of Baron upon ghenst One. Day,
sounding Metternich as to whether a request in that direction
was likely to meet with success, the Chancellor gave him
to understand that he would raise no objection. The brothers

(02:43:45):
accordingly put forward this request, mentioning their services to Austria,
and it was granted by an imperial decree dated September
twenty ninth, eighteen twenty two. All the brothers and their
legitimate descendants of either sex were raised to the rank
of baron. Thus most of the objections raised by the
College of Heralds, the court officials, and Baron Vaughan Letterer

(02:44:07):
were automatically discounted. The Rothchilds obtained the seven pointed coronet,
which as a rather broad hint they had drawn on
the coat of arms submitted in eighteen seventeen. The lion
on the coat was also granted, and instead of the
four arrows which the hand had grasped since they had
been admitted into the ranks of the minor nobility, there
were now five, symbolizing the five brothers. They were also

(02:44:31):
granted supporters, a lion and the unicorn, and three splendid
helmets adorned the coronet. The motto Concordia Integrites Industria was
intended to express the harmony between the brothers, as well
as their honesty and tireless industry, in view of the
enormous value attaching to any title of nobility in those times.

(02:44:52):
The promotion to the rank of baron signified for the
Jewish house, which only twenty years ago had been almost
entirely unknown outside its native town, an almost immeasurable increase
of prestige. The private life of the brothers also changed
from this time. They occupied luxurious dwellings in Frankfort, Paris
and London. Only the aged Goudlish stuck faithfully to the

(02:45:14):
family house in the Jewish Quarter until her death in
eighteen forty nine at the age of ninety six. Their
efforts firmly to establish their social position also met with success,
especially as the stories of the family's wealth had invested
its members with a kind of legendary halo. They consciously
encouraged this belief in their wealth and their power, for
they fully realized that it increased the credit of their house.

(02:45:38):
Astonishing though the achievements of the five brothers had been
since their father's death, they showed no sign yet of
flagging in their efforts. They were driven by the constant
urge to accumulate ever growing riches and to increase their
power and prestige.

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RISE OF ROTHSCHILD - 4. The Brothers Rothschild During the Period of Congresses, 1818-1822 - Count Egon Caesar Corti

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.css-14f5ked{margin:0;word-break:break-word;display:-webkit-box;-webkit-box-orient:vertical;box-orient:vertical;-webkit-line-clamp:2;overflow:hidden;}RISE OF ROTHSCHILD - 4. The Brothers Rothschild During the Period of Congresses, 1818-1822 - Count Egon Caesar Corti