Chapter 1388: Financial Freedom
As the Chamber of Commerce president had stated, if the settlement period for international transactions could be shortened from one or two months to a single week, trade volume would likely increase by a third, or even more, in a short span of time!
Baron Luciani nodded, just about to announce the start of discussions regarding Parma's entry into the Bank for European Settlements, when Fornovo, the owner of Parma's largest discount bank, rose to his feet and declared coldly:
"I believe everyone here is a little too optimistic."
"While this settlement system certainly offers convenience, it would place both our banks and our trade under the control of the Bank for European Settlements!"
"What if, one day, they were to threaten us by halting our transit settlement applications..."
Palmieri immediately waved a hand, pointing to the "Proposal" and stating, "It's clearly written here on page two—45% of the seats on the Bank for European Settlements' board will belong to our nation, and major decisions regarding daily operations will require the approval of 80% of the directors."
Joseph, keenly aware of the importance of "democracy" in international affairs, had stipulated from the outset that the Bank for European Settlements would be jointly controlled by all member states, with France holding only a slightly larger share of seats.
Fornovo glanced over that stipulation and then shouted at the Minister of Finance, "Look, our nation would also be responsible for 45% of the Bank for European Settlements' setup costs. That's hardly worth it!"
He then looked at the bank executives present and asked, "At that point, everyone will have to pay deposits or pledge assets to the Bank for European Settlements, all while submitting to their oversight. Are you truly willing to do that?"
Following this, the meeting, under Fornovo's deliberate guidance, devolved into a debate about the risks of joining the Bank for European Settlements.
At four in the afternoon, Baron Luciani reluctantly declared the meeting adjourned.
The next day, after Palmieri finished signing an interbank loan agreement with Bodoni, the manager of the Milan Savings Bank, he couldn't help but bring up the topic of the Bank for European Settlements.
"This is absolutely the most perfect settlement model I've ever heard of!" the latter exclaimed at once. "When I return, I must recommend to the Milan Council that we should also join this system!"
Milan was Northern Italy's financial hub, and if such an efficient settlement system could be introduced there, the profits would far exceed those in Parma.
Palmieri, however, spread his hands. "But this will affect the discount banks' profits, and they are desperately trying to prevent it."
Bodoni leaned forward and said earnestly, "Listen, old friend, I'll push for Milan to join the Bank for European Settlements. You absolutely must convince Baron Luciani, even if it means spending some money!"
"Spend money?" Palmieri frowned. 'But I think this is something His Majesty the King and the Chamber of Commerce should be concerned about...'"
"What if we could make a huge profit from it?"
That evening, after the Milan Savings Bank manager departed, Palmieri immediately summoned several of his confidantes overnight and instructed them to invest all available funds into buying francs.
Indeed, Bodoni had informed him that once the Bank for European Settlements was established, the use of francs in Northern Italy's international trade would inevitably surge. At that time, many merchants would seek to exchange for francs, thereby driving up the franc's exchange rate.
In other words, by acquiring francs in advance now, they could secure substantial returns with virtually no risk.
Bodoni's efficiency was remarkable; he teamed up with the Milan Chamber of Commerce, and through a series of operations involving strategic financial inducements, quickly garnered significant support from council members.
Just over ten days later, the Milan Council passed a resolution to apply for entry into the Bank for European Settlements system, though with some reservations about exclusively using francs for all international trade.
Joseph hadn't expected new members to be attracted even before the "demonstration zone" was fully established.
He was also highly flexible, immediately agreeing that Milan could accept other national currencies in its foreign trade.
Given the franc's stability and France's enormous trade volume, it would only be a few years before the settlement market was unified.
While things were progressing smoothly in Milan, Palmieri, however, encountered difficulties.
In the office of the Parma Northern Commercial Bank, Bodoni growled with a frown, "Didn't you say the Crown Prince strongly supported this?"
Palmieri nodded grimly. "Fornovo's discount bank has rallied a large number of investors and two ministers, and even the royal family can't ignore their influence."
Bodoni immediately stood up, agitated, and began pacing back and forth across the room.
One had to remember, the Milan Savings Bank had acquired a full 13 million francs during this period, much of it borrowed from other banks. If it remained stockpiled in their vaults, the interest alone would ruin them.
After a while, his eyes glinted coldly as he looked at Palmieri and whispered, "Then let's make sure this troublesome fellow is silenced for good!"
In mid-April, Fornovo was shot in the back of the heart at the opera house, dying instantly.
The assailant claimed that Fornovo had been involved with his wife, and so he had killed him to erase the dishonor.
Well, Bodoni had paid him 7,000 ducat gold coins, which amounted to 84,000 francs.
Fornovo's discount bank was immediately plunged into chaos.
Three days later, Ferdinand I personally signed the agreement for Parma to join the Bank for European Settlements.
...
May 3, 1800.
Versailles Palace.
As Charles stepped through the grand golden doors of the conference hall, he couldn't help but feel a pang of nervousness.
The number of attendees at today's cabinet meeting seemed unusually large; he saw not only all the cabinet ministers and deputy ministers, along with top officials from the Police Bureau, Tax Bureau, and Chamber of Commerce, but even his mother, who hadn't attended a cabinet meeting in a long time.
Indeed, since last year, Joseph had allowed his younger brother to observe cabinet meetings.
Charles's heart suddenly clenched. 'Could this be about my marriage?'
'Is it Princess Maria Anna of Hesse, who is a head shorter than me yet weighs more? Or Princess Augusta of Bavaria, who always seems so listless?'
'No, absolutely not!' He anxiously looked at his brother. 'I only want Louise... But how will I get through today?'
Soon, everyone rose to bow to Her Majesty the Queen and the two Princes. Then, Minister of Finance Godan was the first to stand, holding a document, and announced loudly, "Under the wise governance of His Royal Highness the Crown Prince, our nation's fiscal situation last year was exceptionally sound..."
He knew the Crown Prince disliked flattery, so he quickly got to the point:
"The total national revenue for the entire past year was—1.23 billion francs!"
"The total expenditure for the year was 1.44 billion francs. This resulted in a deficit of 210 million francs."
He glanced at the Crown Prince, then lowered his voice slightly. "The current total government debt stands at 2.38 billion francs."
Joseph smiled and nodded at Godan.
Yes, France's national debt had once again reached a new peak, rapidly approaching 2.4 billion francs. Yet, he wasn't worried in the slightest, because France's current economic scale had more than quadrupled compared to a decade ago, making it perfectly capable of handling this amount of debt without strain.
In fact, the massive fiscal expenditures over the past two years were largely due to extensive railway construction. What appeared to be a deficit was actually having a significant stimulating effect on the national economy.
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