African Entrepreneurship Records

  Chapter 240 Big Borrowing

  Recently, Prussia has obviously become more friendly to Ernst. Before returning to Hohenzollern Castle, Ernst learned that the Prussian royal family invited him to Berlin as a guest.

  Ernst had anticipated Prussia's plan a long time ago, so he diverted to Berlin in Bavaria.

  Kingdom of Prussia.

   "Ernst, how are you doing recently!" William I said with a smile.

   "Your Majesty, I am doing well. I have been busy with business recently, so I have been busy." Ernst said.

   "You can just call him uncle. Your father is also the king now, and you are also the heir apparent, and you are both members of the Hohenzollern family. You don't need to be so born." William I said.

   "I'm afraid this is not good!"

   "What's wrong, everyone is a family. If that's the case, you will call me uncle in private, and your majesty in formal occasions."

  Then William II has become my eldest nephew! Ernst was secretly relieved, but he still said calmly: "Yes, I listened to you, Uncle William."

"now it's right!"

"I called you here today because I actually asked you for something. I'm not afraid of your jokes. Although I, the king, have fought many battles in my life, Prussia's finances have been unsustainable because of this, and I owe a lot of debts. Prussia cannot stop the unification of Germany." William I sighed.

   "Of course I understand that Prussia has indeed made great contributions to the unification of Germany over the years." Ernst complimented.

   "Well, now I can tell you something. The French can't stand it anymore, but Prussia already owed a huge debt in the last war. It is really difficult to raise military expenses this time!"

  See the poor dagger in the picture.

"Uh, Uncle William, although Hexingen has developed well in recent years, but this year's investment is relatively large, so I am afraid that the funds are not too abundant. I also know the difficulties of the government. In this way, I will subscribe for 500,000 Taylor's war bonds to show my support to the kingdom. support is good."

  500,000 Taylor is not a small amount, but it is really not enough for a big capitalist like Ernst.

  Although Prussia is also preparing for war now, France has not declared war on Prussia, and the North German Federal Government cannot agree to allocate funds to the Kingdom.

  Historically, on July 21, 1870, the North German Confederation Congress under the leadership of Prussia approved a war credit line of 120 million Taylor.

  So now, the Kingdom of Prussia can only think of ways to raise some funds on its own. Ernst estimates that Prussia can only raise a few million at most.

  Even at the beginning of the war in the original history, the Berlin stock market was almost panicked, and even high-quality stocks such as the Cologne-Minden Railway fell by 30%. The Prussian government urgently sold 100 million thalers of the first phase of war bonds, trying to get rid of the underwriting channel monopolized by bankers and sell them directly to the market. , was rejected by the government. "This is a ludicrous condition in the current market situation," Oppenheimer stressed in a letter to Breitschroder.

   As a result, the sale was a huge failure, and the bonds were only sold for 60 million thalers. In fact, the root of the problem is that bankers cannot earn underwriting fees if the government sells directly, so they have adopted a collective boycott. This once again shows the power of "channel is king" in the financial market. At the end of October 1870, the Prussian government learned the lessons of the last time and appointed Hansmann to form an underwriting syndicate to sell the second installment of 20 million Taylor loans in London and Berlin. With the victory of the Prussian army, the price of these loan contracts rose, and the government was soon able to cancel some of the mortgaged credit lines. Finally, the interest rate on the war bond was finalized at 5% for a period of 5 years.

  On November 30th, the bankers made persistent efforts and once again successfully issued a 92% off loan of 34 million Taylors in the UK, with the option to issue a further 17 million Taylors. At the same time, although the British began to sympathize with the hapless France, French bonds could hardly be sold in the UK. On the invisible front of finance, France failed again.

  But until the end of the Franco-Prussian War, the total cost of the war in Prussia was only 22 million Taylor.

Ernst is not greedy, and has already started saving money to prepare for the Franco-Prussian War. At present, the entire Hechingen consortium can use more than 30 million Taylors, and Ernst is going to bet at least 20 million on the victory of Prussia. , The bet won, and finally the French paid the bill.

   "500,000? This..." William I was a little melancholy, 500,000 is not a small amount, but it is no different from a drop in the bucket for war.

"Ernst, the development of Hechingen Bank over the years should be very good. I heard that you have started business in the Far East... You can rest assured that we, Prussia, will win this war. Bold investment, while interest We will also set a slightly higher price than the market, not only that, but the creation of the East African Kingdom may also lack many things, which we, Prussia, can cooperate with in the future..."

  What is the certainty of victory? William I just said casually. In fact, Prussia was still afraid before fighting France.

  But William I knew that the wealth of the royal family of Hexingen was absolutely astronomical. Now the Hexingen consortium has taken shape, its business covers the whole of Europe, and it has its business all over the world. So it is right to ask Ernst to borrow money, so William I boldly promised.

  At the same time, everyone is from the Hohenzollern family, so they can play the emotional card. If they can borrow more from the royal family of Hechingen, they can be a little tougher when negotiating with other big capitalists later.

   Ernst pretended to be embarrassed and said: "Actually, there are many industries under Hexingen, but there are also many workers. The wages of the workers alone are not a small amount..."

   "You tell the truth, how much you can give, Prussia can give 7% of the benefits, and at the same time the army gives priority to purchasing Hexingen's products."

"Uncle William, it's not a matter of money or not. However, you helped me a lot when I started my business. It would be too much for me to be so stingy. I won't hide it from you. This year, the company can only mobilize all the funds of 1,500 yuan. About 10,000,000 Taylors, including workers' wages, but for the unification of Germany, I will order 15 million Taylors first! From now on, if Prussia cannot win, the Hexingen Company will also go bankrupt due to a broken capital chain , so please be sure to win!" Ernst said somewhat "heavily".

1500 dollars! William I was a little confused when he heard this number. According to his expectation, or the goal this time, it was three to four million Taylors. After all, I haven't decided whether to fight or not!

Large-scale borrowing requires France to declare war on Prussia. That is to say, Prussia’s finances are too tight now. After all, the last Prussian-Austrian war did not ask for war reparations from Austria, and there are too many debts, so try to borrow some money. Emergency.

  Ernst invested 15 million yuan when he came up, which is enough to fight a big battle, and at the same time can greatly relieve the current financial pressure on Prussia, which also means that the army can prepare in advance!

  William I was very moved. Sure enough, his family was still reliable. Ernst was really selling everything to support Prussia this time! After all, there are not many people who are optimistic about Prussia's victory. If this war fails, the royal family of Hechingen may really go bankrupt.

  Actually, William I was overthinking it. Ernst was such a cautious person, it was impossible to gamble all his belongings.

Not only that, Ernst planned to continue to buy shares worth 10 million thalers after Prussia issued the first war bond, and at the same time use the Hechingen Bank to help Prussia issue bonds to earn some extra handling fees, plus the previously promised by William I Privilege, when the time comes, it will be really lucrative.

   The two parties, who both thought they were making a lot of money, quickly signed the agreement. Professionals from the Prussian government and the Hechingen Consortium carefully checked all the terms dozens of times, and signed their names after confirming that they were correct.

  (end of this chapter)