London - Edward Rutherfurd [503]
Penny had attained some seniority in the firm now. Since the affair with the old Earl of St James, Meredith had entrusted him with a number of tasks needing discretion and he was used to confiding in him about the bank’s business.
“We’ve followed Baring’s and Rothschild’s,” Meredith said. The two leaders in the foreign loans market had utterly shunned the stock speculation. “Our own positions are pretty sound. But what I do fear,” he admitted, “is a general decline. It’s very hard for a small bank like ours to protect against that.” He shrugged. “It all depends on who goes down.”
The danger to Meredith’s Bank which Eugene had originally surmised was endemic to all such small operations. If some of those who owed Meredith money went under, he could be in peril. “But the real danger,” he went on, “is not so specific. It isn’t a bad investment or a shaky loan – it’s nothing you can even predict. It’s loss of confidence. That’s what can kill us.”
“I’ve never really seen that happen,” Eugene confessed.
“Pray,” said Meredith, “that you never do.”
Eugene saw Mary every week. There was no doubt, they felt, that they would marry; but how soon was another matter. Eugene’s salary had increased considerably; his position looked secure, but he had not yet reached a standing that would satisfy Mr Hamish Forsyth.
The trouble began in the autumn. “Batten down the hatches, Penny,” Meredith announced. “I think we’re in for a storm. The word is,” he explained, “that the Bank of England is tightening up.”
By October there were murmurs. By November there were cries. The markets began to falter, then to fall. “This can’t go on!” Meredith declared. “The Bank must loosen up or everyone’s going to panic.”
Early in December, the Bank of England did conclude that it had gone too far and, started granting credit. It was too late.
On Wednesday 7 December it was confirmed that Pole’s, a private bank closely linked with no less than thirty-eight provincial county banks, had been bailed out over the weekend by the Bank. On Thursday the 8th, a big Yorkshire bank called Wentworth’s suddenly went under. Over the next few days, gentlemen all over England were rushing to their local banks to take out their money. News came back to London with the stage-coaches from every county town. “Gold. They all want gold!”
That weekend, Pole’s stopped all payments. By Monday 16 December, in consequence, three dozen country banks had collapsed.
Fog had spread over the city before dawn that Monday. It made everything so quiet. At times, it almost seemed to Penny that the world might have come to an end as they waited in that yellow-lighted counting-house for someone to come and tell them it was all over.
The morning passed uneventfully. There was no trading to be done. From time to time one of the clerks would be sent out for news, vanishing into the oblivion and returning with reports: “The Exchange is full of people demanding money!” “Williams’s in Mincing Lane is besieged. Don’t know if they can hold out …”
Meredith’s own preparations had been thorough. During the last week he had seen almost all the bank’s major clients. “I think I’ve squared them all,” he told Eugene. “But if the panic really takes hold. . .” He shrugged. The fog, he suspected, was actually a help. “People will have to seek us out. They won’t just think of us as they pass in the street.” He had also laid in as much gold coin as he could. “Twenty thousand in sovereigns,” he announced. Though Penny noticed that when he remarked, “That should do it”, Meredith had muttered: “It’ll have to.”
Only a few people came to withdraw money in the morning. At noon, miraculously, a merchant came in and deposited a thousand pounds. “Took it out of Williams’s,” he explained. “Safer with you.” While news came of more banks in difficulty