Millionaire - Janet Gleeson [13]
The ingenious scheme that William eventually sanctioned was proposed by William Paterson, a Scot. It was simple, as have been many of the most effective innovations throughout history. Basing his ideas on the highly successful national banks of Amsterdam and Venice, Paterson proposed that money could be raised for the king by the formation of a bank funded by a large number of private investors. Each would subscribe to a total value of £1,200,000, and this sum would then be lent to the king for eleven years at 8 percent interest. To allay fears of a repetition of Charles II’s waywardness, the government would guarantee repayment of the loan. Depositors were to be given handwritten banknotes, signed by one of the bank’s cashiers, which contained a promise to pay the bearer on demand the sum of the note—in other words, the note could be exchanged for gold or silver coin at any time by anyone presenting it for payment. Thus banknotes would circulate in a limited way as paper money.
The subscription list of the institution, known ever since as the Bank of England, was opened for investors on June 21, 1694. Within twelve days the total was subscribed. The king had enough money to pursue his war—for the time being at least—and the limited issue of banknotes as a new medium of exchange helped alleviate the shortage of coin.
Even if he had had the resources to do so, John Law could not have invested in what turned out to be a financial landmark that underpinned the rapid advances of his age. He was in prison, convicted of murder.
4
THE DUEL
Twill be in vain to make a long defence,
In vain ’twill be to plead thy innocence.
His breath concludes the sentence of the day,
He kills at once, for ’tis the Shortest Way.
Daniel Defoe,
More Reformation (1703)
AS THEIR CARRIAGE DREW INTO BLOOMSBURY SQUARE, the two men found John Law waiting. Hearing the clatter of carriage wheels, he turned expectantly and watched as one of them descended from the carriage and strode purposefully toward him. It was just past midday on April 9, 1694.
Bloomsbury Square was a celebrated architectural land-mark on the fringes of a rapidly advancing city. Three sides were framed with gracious brick-fronted façades, the recently completed residences of the well-to-do who had escaped the stench of the city and gravitated to this district in search of “good air.” Spanning the northern limit stretched the imposing, multipedimented Southampton House. Beyond, formal gardens avenued with lime trees led on to open fields that separated the square from nearby St. Giles.
In spring and summer months this meadowland divide was filled with flowering grasses and scattered with cowslips, foxgloves, and heartsease. Amorous couples wandered among the peach trees that, according to the great nineteenth-century historian Macaulay, improbably flourished here; snipe nested safely among grassy tussocks of damp undergrowth. Yet a more menacing convention overshadowed this urban Arcadia: the stretch of open terrain was renowned in seventeenth-century London as a place where duels were regularly fought.
It was on this ground that John Law paced apprehensively as the man from the carriage approached. It appeared—as several witnesses later attested—that a meeting had been prearranged between them, a fact that would be significant later on. As he came face to face with Law, perhaps with a flourish of drunken confidence, the man drew his sword. Instantly and, he would later say, unthinkingly, John Law responded. Drawing his sword—“a weapon of iron and steel that had cost