Chapter 979: Another Great Ming Iron Bank (Please Subscribe)

"What about England?" Zhu Cilang did not immediately give the French envoy Kirkbell an answer, but instead asked about England's needs. "Does England need a loan from the Great Ming?"

"If the interest rate is suitable, England would also like to obtain a loan." Marvell naturally would not refuse a low-interest loan.

Although the financial condition of the English Commonwealth was far better than that of the Kingdom of France, in these times European wars often dragged on for decades, and even the wealthiest could reach a point where they could not hold out.

The fiscal revenue of the English Commonwealth under Cromwell's leadership was around two million four hundred thousand pounds sterling per year. One pound sterling was one pound of silver, roughly equal to three or four Great Ming "bank taels," so two million four hundred thousand pounds was less than ten million taels of silver. Compared with the Kingdom of France's fiscal revenue, it was still a little less. Truly poor!

Compared with the combined twenty million taels of fiscal revenue of England and France and the Great Ming's one hundred million to one hundred ten million taels (a considerable portion in grain and cloth), it was truly not worth mentioning.

So from the perspective of fiscal revenue, the present Great Ming truly deserved the title of Celestial Empire!

And the legend that the Great Ming Celestial Empire was extremely wealthy was, in the eyes of the financial expert Zhu Cilang, credit!

And credit is the true foundation of banking!

So Zhu Cilang very much hoped that the banks of the Great Ming Celestial Empire could provide loans to England and France. Even if the interest was not high, even if there was a certain risk of bad debt, it was worth doing.

"The interest rate will certainly be suitable!" Zhu Cilang said with a smile. "Moreover, our Great Ming banks will provide a total borrowing limit to large clients with good credit, called a credit line. Within the credit line, the borrower may apply at any time, according to their own needs, for short-term or longer-term loans, and the credit line can be used on a revolving basis. After a short-term loan is repaid, the remaining credit will increase accordingly. Considering the current financial condition of the English Commonwealth, We suggest that you apply to a large Great Ming bank for a substantial credit line, which you may draw upon at any time when needed."

This idea sounded rather good!

Marvell was a Puritan statesman, and such men were very good at careful calculation. When borrowing money, of course he had to figure the interest, but he quickly discovered a problem.

"Your Majesty, the distance between England and China is truly too great. A round trip requires at least several months."

"That is a problem." Zhu Cilang made a show of thinking for a moment. "How about this: let our Great Ming's two largest banks jointly invest capital to open a bank in Europe, devoted specifically to providing loans to England and France. What do you think?"

The Zhu Emperor turned his head to look at the French envoy Kirkbell and said with a smile, "Mister Envoy, if Cardinal Mazarin and His Majesty Louis XIV agree, then a loan of five million taels is absolutely no problem, and the interest rate will certainly be very reasonable!"

Kirkbell hastily nodded. "I believe they will certainly agree!"

How could they possibly not agree? Five million taels of silver! Equivalent to twenty or thirty million francs. How many mercenaries could that buy? With this war chest, His Majesty the King's army might well conquer the whole of the Spanish Netherlands!

Zhu Cilang nodded with a smile, then looked at Marvell again. "We suppose His Highness the Lord Protector would not refuse either?"

"Of course not." Although Marvell felt uneasy, he could not think of any reason to refuse.

Zhu Cilang smiled. "Then it is settled. Our three nations have reached a most critical consensus!"

Watching the Zhu Emperor looking quite pleased, the assembled Lu Zhenfei, Qian Qianyi, Wu Sanfu, and Huang Binqing could not help but knit their brows.

Borrowing money is easy; collecting debts is hard!

Especially lending money to a country on the other side of the world. So far away, there was no way to force repayment! If France and England ultimately defaulted and refused to pay, would not several million taels of silver simply be thrown away?

This deal was going to lose money!

Zhu Cilang was also watching these men out of the corner of his eye. Seeing every one of them frowning, he was somewhat disappointed. The Great Ming had been going capitalist for over a decade now; how could you few still not understand the enormous value of Great Ming banking entering Europe?

Banking! Besides lending, it could also take deposits, issue bonds, handle remittances and currency exchange, and even issue banknotes. And it had the golden touch of creating money through the multiplier effect.

To be able to open Great Ming banks in Europe, and from the very start become the creditor of France and England, two of Europe's first-rank great powers — what enormous credit that was!

Moreover, the silver lent to England and France would not all be thrown away — that was money lent to nations, after all!

Although the Sun King Louis XIV, who squandered money recklessly, might well turn out to be a deadbeat, he would not refuse to pay a single cent. At worst he would pay only the interest and not the principal.

But that did not matter. As long as he could remain the Sun King of Europe, as long as France could continue to lead European trends for a time, this deal could not lose!

As for the money lent to the English Commonwealth, there was even less of a problem. Even after Charles II came to the throne, he would not dare repudiate the debt. This was England's national credit!

Besides, England's war with Holland was not over yet. They would never push the Great Ming toward Holland over a mere two or three million.

Moreover, England's fiscal strength in the seventeenth and eighteenth centuries was rising rapidly; it would not lack these two or three million taels of silver.

So this was absolutely a fine deal!

In addition, and most importantly, what Zhu Cilang had reached with the French and English envoys was called a "loan intention" — not actually handing over the silver!

In later financial circles, were there not plenty of people who used all sorts of "intentions" to deceive others?

So the Zhu Emperor was not bargaining with the French and English at all right now. However much you wanted to borrow, it was one sentence — this Emperor has the intention, but the Emperor is not responsible for lending; for loans you must go to the banks.

And the Great Ming's banks could not open branches in Europe, because branches would spill risk over to the head office. Under present communications conditions, separated by half the globe, branches could not be opened; risk simply could not be controlled. So the only option was to establish a Ming-capitalized joint-stock bank in Europe. If this bank failed, the loss was only a few million in principal. And establishing a new bank was not something that could be done in ten days or half a month, so Louis XIV and Cromwell would need some patience and would have to wait.

But before they got their silver, this Great Ming joint-stock bank would become famous throughout Europe for lending to England and France.

Such a fine deal, and yet these senior officials of capitalist Great Ming still wore worried faces. You people simply do not understand the business!

Fortunately, not every high official of the Great Ming present was frowning. There was one who was all smiles.

The Zhu Emperor now noticed that Luo Dagong was grinning as if he had picked up money — at last, someone who understood the business! The Zhu Emperor thought to himself: it seems he should be brought into the Grand Secretariat! Later, split the Ministry of Rites, take out the diplomatic office and form a Ministry of Foreign Affairs, and let Luo Dagong be its Minister.

"Luo Dagong," Zhu Cilang said, looking at the broadly smiling Luo Dagong, "what should be discussed next?"

"Your Majesty, next we should discuss the question of the Americas," Luo Dagong said.

Zhu Cilang nodded. "In fact, long, long ago, our country opened a colony in the northwest corner of the Americas, called the Xinzhou Protectorate."

What? You opened a colony in the Americas long, long ago?

Exactly when?

Was it earlier than Columbus's discovery of the New World?

After Zhu Cilang's words were translated into French, both Kirkbell and Marvell (a cultured great poet who of course understood French) were shocked.

Looking at the astonished expressions on the two foreigners' faces, Zhu Cilang smiled and said, "Of course, the territory of our country's Xinzhou Protectorate, now called the America Protectorate, includes only the northwestern part of North America. You may not know this, but in fact western North America and Shenzhou — that is, what you call the northeastern part of Asia — both have an enormous peninsula, and between these two peninsulas lies only a little over a hundred li of sea, very easy to cross.

So as early as the Tang dynasty, our country's explorers had already gone to the northwest of the New World, and moreover, on behalf of the Tang emperor, had won over the local natives. Therefore this northwest of the New World has been Chinese land since ancient times.

On this point, England and France have no objections, do they?"

(End of Chapter)