FOOTNOTES:

THE MONETARY INQUIRY OF 1381

Three years later—one year after the French King had lowered his ratio from 12.1 to 10.74—the Commons presented a petition to the King during the sitting of Parliament, 1381, complaining of the wretched want of the kingdom, which was devoid of treasure, monies of gold and silver being carried out of the realm, and those remaining being clipped to one-third their nominal value. No money at all was being minted in the Tower, and a heavy export of our metals to Scotland and Ireland was taking place. Simultaneously the officers of the Mint presented a petition to the King and his Council in Parliament, complaining that no money was being coined. The causes of this, in their opinion, were—

1. That the monies of gold and silver beyond the seas were more feeble than the monies of England, on which account the merchants could not bring bullion into England for their profit nor for the King's advantage. But if any manner of bullion of gold were brought into the kingdom, by persons travelling, it was sold to those who conveyed it out of England, to their great gain and to the injury of the whole realm.

2. That the silver of England which [i.e.when it] was found to be good and heavy, was taken into Scotland, because the money of that country was so light.

3. That the gold of England being so good and heavy, and that beyond sea so light, thenobleswhich came from Calais were gone into Flanders, and the Englishnobleswere carried beyond the sea, to the great profit of those who exported them, etc. etc.

4. That the money of gold and silver of England was commonly clipped, so that they who thought they should have £100 would have no more than £90, unless a remedy were speedily applied.

The officers of the Mint were accordingly ordered to be called before the Lords of the Parliament for examination, and they were succeeded by others, private persons but mostly goldsmiths, who were called upon as experts. In the case of these latter the various statements of opinion are preserved for us in the Rolls of Parliament, and they possess a peculiar interest.

Richard Leye thought that the reason why no gold or silver was brought into England, but, on the contrary, that which had been in the kingdom was exported, was this, that the realm expended too much on merchandise, such as grocery, mercery, furs, etc. He therefore proposed that every merchant who imported goods into England should export an equal quantity of the produce of the realm, and that no one should take out gold or silver, contrary to the statutes.

As to the gold not agreeing with the silver (which was Article IV. of the inquiry), he thought that could not be remedied, unless the money were changed, and to change it in any manner would be productive of universal injury to Lords, Commons, etc.

To Article V. he advised that, whereas new money had been made in Flanders and in Scotland, proclamation be made that all manner of coins of Flanders, Scotland, and of all other places beyond the seas,should be no longer current in England, and that no one should receive them in payment except as bullion to be carried to the King's Mint.

Lincoln, a goldsmith, gave his opinion similarly against the permission to export gold and silver, and proposed that the gold noble should remain of the same weight as it had been, but at a greater value.

To the First Article Cranten said, that no more in value of foreign merchandise should be consumed within the realm than should be exported of commodities, the growth of England; and then, whether the money were enhanced or debased, it would hereafter remain within the realm. Also, that exchanges or other payments by letters should not be made out of Flanders, or other parts beyond the seas, to pay in England for any merchandise.

John Hoo advised a proclamation against the carrying out of gold or silver, and that the money should be received by weight.

The statement of opinion of the succeeding and last witness is extremely valuable and interesting. Richard Aylesbury opined that, provided the merchandise exported from England was properly regulated,—that is, if no more of foreign commodities were allowed to be imported than the value of the native products which should be taken out,—the money then in England would remain, and great plenty would come from beyond the seas.

He also conceived it to be expedient that the Pope's collector [of Peter's Pence] should be anEnglishman, and that the Pope's money should be sent to him in merchandise and not in coin, and that the journeys of clerks should be entirely forbidden, on pain, etc.

For the feebleness of the gold, which was occasioned by clipping, he conceived there was no other remedy but that it should be universally weighed by those who received it, and that the proclamation should be made accordingly.

The agreement of the gold with the silver he believed could not be effected unless the money were changed, but that he dared not to propose on account of the general damage which would ensue.

On account of the new money which had been made in Flanders and Scotland, he advised that all Scottish monies should be forbidden by proclamation, and also all other monies from beyond the sea, so that they should have no currency in England; and that no one should take them in payment, except at their value as bullion and for the King's coinage; that no one should export gold or silver, according to the statute in that case made, etc.

And, further, he suggested, by way of information, that the pound of gold which was there made into the sum of 45 nobles (but which pound, by reason of clipping and otherwise impairing, was then valued at 411⁄2nobles) should be made into 48 nobles, to be current at the same value as before.

This last proposition would have reduced the ratio to a fraction over 11:1—something higherthan the ratio prevalent in France. Instead of acting on evidence such as this, however, and so changing the ratio, Richard's Government contented itself with the perfectly useless prohibition of export of gold or silver (statute 5 Rich.II.cap. 1). Four years later, accordingly, the matter was again pressed upon the attention of Parliament, and even by the Chancellor of the realm, Michael de la Pole himself, in his opening speech. The English money, he said, was in greater estimation and of higher value in all other places than in England. It was therefore sought out and craftily withdrawn, and the chief or greatest remedy was to increase the value or price of the said money.

In spite of such recommendation as this the measure was not adopted, and Richard fell back on his previous expedients, crying down by proclamation the value of the Scotch coins, 1387, and of the gold coins of Flanders and Brabant, 1393, and ordaining by enactment that exporters of goods should bring in 1 oz. of gold for every sack of wool which they sold.

Such an ordinance as this last is of the commonest and most frequent occurrence in the enactments of fifteenth-century England, but always unworkable as warring against the most elementary principles of international trade.

On his accession, therefore, HenryIV.found himself heir to an accumulation of monetary evil, through the impolicy and want of courage of Richard.

THE RECOINAGE OF 1414

He was obliged, at the request of the mayors and merchants of the staple of Calais, to abolish the last unworkable ordinance just referred to, and attempted at the same time to provide a positive remedy by reviving a proclamation against the currency of silver halfpennies brought from Venice, of which three or four only were equal to one sterling in value. In 1401 the Commons complained in Parliament that nobles of Flanders were so common in England that a man could not receive a sum of 100 shillings without taking three or four such nobles, each of them more feeble than the English noble by two-pence.

A statute was accordingly passed, enacting that all money of gold and silver of the coin of Flanders and all other lands, and of Scotland, should be voided out of the land, or put to coin to the bullion.

It was all in vain. Two years later, 1403, the Commons again complained of the depletion of gold, and again a statute was passed, and so on. This futile process actually reproduces itself yearly up to 1411, when at last the question of a recoinage was fairly faced. By the ordinance for, and regulation of, the money of the realm, of that year, it was provided that, "because of the great scarcity of money at the time," the Master of the Mint should make of every pound of gold 50 nobles, and of silver 30 shillings of esterlings of old alloy.

This recoinage was carried out and finished in the third year of HenryV., 1414. Under it thecontents of the silver penny sank from 18 to 15 grs., and of the gold noble from 120 to 108 grs., the consequent change in the ratio being from 11.15, which had prevailed since 1353 to 10.33.

At this latter rate the monetary system of England remained for almost fifty years, viz. up to 1460. But, though the rate endured so long, it is not for a moment to be supposed that the ensuing period was one of repose. Within eight years of the accomplishment of the reform in the English coinage, the ratio in France was lowered to a point somewhat below the established rate in England, and with considerable variation remained lower through all the years in question, 1414-1460. In 1421 it was changed to 10.29, in 1427 to 9, in 1432 to 10.87, and in 1447 to 11.44.

The effect on England, as recorded in the complaints in Parliament, was almost parallel with that in the days of Richard. In 1414 complaints were made against the circulation of galley halfpence by the merchants of Venice. Three years later proclamation was made against the circulation of the gold monies of Flanders, calledBurgundy nobles, which were of less value than the English nobles. In 1419 it was found that money was being exported "more largely, and in many other manners, than had been accustomed, to the great mischief and impoverishment of the whole realm." And in the following year the usual statute was enacted, on the petition of the Commons, commanding foreign money tobe taken as bullion. Again, two years later, 1422, the enfeebled and depreciated state of the coinage was so apparent that the collectors of the subsidy granted in that year by Parliament were instructed to accept nobles as of the denominational value of 6s. 8d. (i.e.the full value), "provided they stretched verily to the value of 5s. 8d. by weight." At the same time silver money was so scarce that "though [i.e.even if] a noble were so good of gold and weight as 6s. 8d., yet men could get no white money for it." In 1423 the Commons complained of the want of silver coins in the realm, "to the great unease and harm of the poorer people of this land," "because [says the statute, which was accordingly enacted], that silver is bought and sold uncoined at 32s. the pound of Troy, whereas the same pound is no more of value at the coin than 32s., with an abatement of 12 dens. for the coinage."

THE MONETARY TROUBLES OF HENRY VI

From the twenty-fourth chapter of the statute of 1429 it appears, quite consonantly, "that the merchant aliens had of late introduced a custom of refusing to take silver, as they were wont, for their merchandises, and of taking only gold nobles, half-nobles, and farthings, which, from time to time, they carried out of the realm into other foreign countries, where they were changed to their increase and forged into other coins, so that they gained in the alloy of every noble twenty pence, against the tenor of the statutes, etc., and to the prejudice of the King and realm. Therefore the King, willing to provide aremedy, ordained that no merchant alien should constrain nor bind any of his liege people by promise covenant or liege, to make him payment in gold for any manner of debt due to him, nor refuse to receive payment in silver for any manner of such duty or debt, upon the pain of the double value of the same."

In 1439 provision was again ordered to prevent exportation of money by merchant aliens. It was renewed in 1448, and five years later the Commons petitioned that the silver mines of Devon and Cornwall, which had not been worked for a long time, might be again opened, on account of the great scarcity of money.

The confusion of the Wars of the Roses, however, renders it slightly problematical how far the two successive lowerings of the coinage, which took place in 1460 and 1465 or 1470, are to be attributed to arbitrary action or to a natural process. By the recoinage of 1460 the noble was increased in weight from 108 grs. to 120 grs., and the value from 6s. 8d. to 8s. 4d., being a real appreciation of the grain of gold from .7407 to .7500 of a penny. At approximately the same date, 1464, the weight of the silver penny was lowered from 15 to 12 grs. In the succeeding recoinage of 1465 and 1470 these rates were again altered. A new gold coin, theangel, was instituted, weighing 80 grs., and valued at 6s. 8d., while the weight of the silver penny was left unaltered. The ratio was accordingly changed to 11.15.

This was the last change of the coinage made inEngland before the era of the discovery of America. The internal effects which the changes had on the commerce of the time are hidden from us by the disturbing influences of the Wars of the Roses.

CONCLUSION OF THE FIRST PERIOD

But it is, probably, in connection with this change of the English ratio—or with some wider, general movement, acting on both countries alike—that the last monetary ordinances of LouisXI.of France, referred to above, are to be understood.

These acts of conflicting policies mark the conclusion of the first period of European metallic monetary history, for no further changes were enacted previous to the close of the century and the discovery of America. As far as England was concerned, the monetary system remained comparatively unchanged till the days of HenryVII.

On a review of the whole period two simple facts emerge with unmistakable plainness and import.

1. It was a period in which the commercial expanse outstripped the reinforcing supply of the precious metals, and therefore in which a real decline of prices[8]prevails.

2. The evil effects of such decline were enormously increased by shortsighted, crafty manipulation of the currency by the European rulers, and by the rough, unscientific system of the prevailing coinage and exchange rates, and by the inability of the age tounderstand, or even to perceive, the hidden working of two metals see-sawing against each other—acting as levers against each other—cutting each other's throats. The discovery of America corrected the fall of prices and saved Europe, but it left her rulers as deadly ignorant as before of the workings of bimetallism—to give a name to what they had not even perceived as a phenomenon, much less as a system.

FOOTNOTES:[1]This is the date accepted by the numismatic authorities. It is adopted by Orsini (Storia delle Monete della Repubblica Fiorentina, p. xxiv, where he states the authority for it). It is nevertheless open to serious doubt. See in De Saulcy, Documents I. pp. 115-131, references to florins d'or from 1180 onwards. On the other hand, as to the nature of the florin de compte and its distinction from the florin d'or, see M.L. Blancard,Revue numismatique, 1886, pp. 48, 218, and 1887, p. 259; and Vicomte D'Avenel,Histoire de la propriété, etc., i. p. 41.[2]Est a notter que le Roi en fit forger aulcune quantité (some slight quantity) d'or du poids de 12 den. 16 gr. chacune pièce laguelle auvrage il dedia seullement pour sou aulmosne aux pauvres ausquels souvent il lavait les piedz par humilité. Et en fut jamais inventée ladite pièce d'or pour aultre cause que dessus et non pour monnaie uzuelle et publicque." (De Saulcy,Documents, i.115, 122, 125).[3]See, however, in De Saulcy, i. 31, a mention ofmanteletz d'or de Flandrein 1265.[4]Soetbeer considers the standard in 1386 as 23 fine, and asserts that, by the Mint edict of 1402, it was lowered to 221⁄2carats.[5]For an estimation of thecommercialeffect of these debasements, see Vicomte D'Avenel,Histoire de la propriété, etc., i. 53-54[6]For a similar table calculated in francs, see Vicomte D'Avenel,Histoire de la propriété, etc., i. 62, 481, where the figures are very different. On Le Vicomte D'Avenel's method of calculation, see theEnglish Historical Review.[7]Seenoteon p.397,infra.[8]By prices here, and subsequently throughout this volume, is meant the price or tariff and Mint rate of the coins. There is no reference whatever to general prices.

[1]This is the date accepted by the numismatic authorities. It is adopted by Orsini (Storia delle Monete della Repubblica Fiorentina, p. xxiv, where he states the authority for it). It is nevertheless open to serious doubt. See in De Saulcy, Documents I. pp. 115-131, references to florins d'or from 1180 onwards. On the other hand, as to the nature of the florin de compte and its distinction from the florin d'or, see M.L. Blancard,Revue numismatique, 1886, pp. 48, 218, and 1887, p. 259; and Vicomte D'Avenel,Histoire de la propriété, etc., i. p. 41.

[2]Est a notter que le Roi en fit forger aulcune quantité (some slight quantity) d'or du poids de 12 den. 16 gr. chacune pièce laguelle auvrage il dedia seullement pour sou aulmosne aux pauvres ausquels souvent il lavait les piedz par humilité. Et en fut jamais inventée ladite pièce d'or pour aultre cause que dessus et non pour monnaie uzuelle et publicque." (De Saulcy,Documents, i.115, 122, 125).

[3]See, however, in De Saulcy, i. 31, a mention ofmanteletz d'or de Flandrein 1265.

[4]Soetbeer considers the standard in 1386 as 23 fine, and asserts that, by the Mint edict of 1402, it was lowered to 221⁄2carats.

[5]For an estimation of thecommercialeffect of these debasements, see Vicomte D'Avenel,Histoire de la propriété, etc., i. 53-54

[6]For a similar table calculated in francs, see Vicomte D'Avenel,Histoire de la propriété, etc., i. 62, 481, where the figures are very different. On Le Vicomte D'Avenel's method of calculation, see theEnglish Historical Review.

[7]Seenoteon p.397,infra.

[8]By prices here, and subsequently throughout this volume, is meant the price or tariff and Mint rate of the coins. There is no reference whatever to general prices.

The last decade of the fifteenth century witnessed the discovery of America, and therein the monetary salvation and resurrection of the Old World. The end of the second quarter of the seventeenth century in its turn witnessed the end of the first phase, and the most important, of the New World upon the destinies of Europe. Practically and historically the century and a half intervening between 1493 and 1660 may be treated as a single cycle with a single aspect. It was a time of unexampled increase in the imports of the precious metals, of equally unexampled rise of prices, and at the same time of feverish instability and want of equilibrium in the monetary systems of Europe. Two general statements may be premised.

1. Broadly speaking—of prices,i.e.—no movement of any note is perceptible, or records itself in legislative enactment until about 1520, so gradualand at first unimportant was the flow of metal from America. What did come at first was not silver so much as gold, and represents the puny and blood-stained plunder of ornaments from the natives. If this import tended to turn the balance in any way, it was in the direction of depreciation of gold as compared with silver. But during this first quarter of the sixteenth century, possibly more influence on the maintaining of equilibrium is to be attributed to the largely increased home production of silver. The silver mining in the Saxon Harz, in Bohemia, and the Tyrol, had received a strong impulse towards the close of the fifteenth century, while gold was obtained during the same period in appreciably greater quantities in the archbishopric of Salzburg, and in Hungary, as well as from Africa.

GENERAL STATEMENT

2. In this second period of European bimetallic history, the centre of European monetary exchanges passes from Italy to the Netherlands. Antwerp takes the place of Venice and Florence. There is a double and deep significance in the fact. It is not merely that the trade route had changed in such a way as to lay the foundation for that development of European commerce, of which England is the highest expression in our own days; it is that by the change was provided a more effective safeguard against precipitate and overwhelming depreciation. The centre of European exchanges—Antwerp in the sixteenth, as London to-day—has always performed one supremest function—that of regulating the flowof metals from the New World by means of exporting the overplus to the East. The drain of silver to the East, discernible from the very birth of European commerce, has been the salvation of Europe, and in providing for it Antwerp acted as the safety-valve of the sixteenth-century system, as London has done since. The importance of the change of the centre of gravity and exchange from Venice to Antwerp lies therefore in this fact. Under the old system of overland and limited trade, Venice could only provide for such puny exchange and flow as the mediæval system of Europe demanded. She would have been unable to cope with such a flood of inflowing metal as the sixteenth century witnessed, and Europe would have been overwhelmed. But the foundations of the commerce of the Netherlands were laid wider. Together with Portugal she opened an extensive empire along the coasts of Africa and in the Indian East; and the very time which gave birth to the revolution in the production of the precious metals in America saw provision made for the regulation of its outflow through the commerce and exchanges of Antwerp to India. In the modern system this would be a theoretically perfect world-mechanism, and its working would be normal and healthy, and the safest indicator of commerce. That it was not so to seventeenth-century Europe was simply due to the existence of a disordered, understood bimetallic system, and the crisis to which the working of this mechanism brought her hasperhaps not been since equalled at any point of time.

The underlying causes of this crisis have been already described. The currencies of the trading nations of Europe were all unconsciously bimetallic. Throughout, there was in existence one class who grasped thefactwithout any knowledge of thetheory, and profited by it—the merchant exchangers. There was constant oscillation—change of ratio, and the least alteration of the condition of one metal made it a lever for operations upon the other. These operations were arbitrage merely. They had no relation to the ebb and flow of commerce as modern arbitrage transactions have. It was a financier's opportunity ofprivategain, and forprivategain the system was worked. The ebb and flow of European currencies, which the sixteenth and seventeenth centuries witnessed, were as unnecessary (i.e.for the purposes of her commerce) as they were disastrous.

It is sufficient to indicate the tendency of this argument, and to leave the illustration of it to the following pages.

PRODUCTION OF THE PRECIOUS METALS

To return to the yield of precious metals during the years under discussion. Any estimate must be conjectural, in the absence of the accounts of the Spanish Mints.[9]This understood, it may be thus tabularly represented.

Date.Annual Average Production of Gold.Annual Average Production of Silver.Proportion of Gold in Total.Proportion of Silver in Total.1493-1520£800,000£600,00057%43%1521-451,000,0001,100,00047%53%1545-601,200,0003,850,00023.676.41560-80855,0003,640,00020.879.21581-16001,030,0004,945,00017.282.81601-201,190,0004,820,00019.880.21621-401,157,8503,916,30022.877.21641-601,223,4003,516,50025.874.2

The general tendency of the first years of this period (1493-1520), if discernible at all, seems rather in favour of silver, and to the depreciation of gold. The average ratio was 10.75, speaking very generally, and with every mental reservation as to its applicability at any particular time and place. An equally rough average for the preceding time (seeChapter I.) would give a ratio of 11.28, showing apparently a movement in favour of silver owing to the increased production of gold.

The succeeding quarter of a century, 1521-45,covers the time from the conquest of Mexico to the commencement of the exploitation of the silver mines of Potosi. Looked at from the point of view of prices in Europe,—as evidenced most circumstantially in thePlakkaatsof the Netherlands, to which reference will be immediately made,—these years display stability—i.e.a steady maintaining of the advance gradually and already made between the years 1493 and 1520, and chronicled for us in the prices of 1521—rather than any further great and readily perceptible rise. For example in brief. In the FlemishPlakkaatsthe French crown is quoted at an equivalent of 1 florin 151⁄2stivers in 1499, and of 1 florin 19 stivers in 1522, when an attempt was made to reduce it to 1 florin 151⁄2stivers again. From 1522 to 1548 no further advance, but retrogression rather is quoted thus:—

Date.Florin.Stivers.1519French Crown quoted at1151⁄21522"1191526"(Real)119"(Attempted)1151⁄21539"(Real)117"(Attempted)1151548"1171552"119

This general conclusion will be found quiteinvariably illustrated in the tables of Netherland coins (below).

With regard to the annual average production of the metal, there is perceptible a slight movement towards the depreciation of silver or in favour of gold. This might naturally be expected to express itself in a somewhat higher ratio. But the differentiation is so slight as hardly thus to indicate itself, and certainly not consistently, so far as the ratio is capable of ascertainment.

In France the ratio in1519was11.761540"11.82In the Netherlands the ratio in1520"10.681540"10.62In England1527"11.231552"11.1In Germany1524"11.381551"11.38

CHARACTERISTICS OF THE PERIOD, 1493-1548

Broadly speaking, therefore, there is a certain homogeneity about the first two periods, 1493-1520 and 1520-48, of the new era. These fifty-five years mark a time of general advance on prices achieved by 1520 and maintained unequally up to 1548, but an advance which was steadily and almost fairly level on the two lines of gold and silver, so that the perfectly well-established advance of prices generally is accompanied with no great disturbance of the ratio in itself.

In contrast with this all the succeeding periods have, up to 1660, a distinct character and statistical bearing. An enormous and ever-increasing advancein general prices occurs, but it is no longer, as before, on level lines of the two metals equally. The proportion of the production of the two metals changes, so rich was the yield of the silver mines of Potosi. From being the same with that of gold, the value of silver produced suddenly rises to three times and then to four times that of its rival; and at once the ratio changes, bringing with it all its accompaniment of feverish instability and flux.

STATEMENT OF THE RATIO, 1500-1660

The average result in the ratio was as follows:—

1545-6011.301561-8011.501581-160011.801601-2012.251621-4014.001641-6014.50166115.0

As far as can be ascertained the detailed statement of the ratio during the whole period, 1500-1660,is as follows:—

Date.England.Netherlands.France.Spain.Germany (Imperial System).S.W. Germany (Wurtemburg, Strasburg, Colmar).Venice.Date.14749.8241474147510.9851475148011.5551480148311.6751483148411.371484148910.511.21489149711.8310.7551497150610.262150615111511151710.31 (Erfürt)11.321517151910.1511.7612.041519152411.381524152712.2310.031527152911.071529153710.7601537153911.681539154010.6211.821540154211.271542154811.01548154911.861549155012.071550155111.4710.831551155211.1(Imperial Edict)1552155311.051553155410.701554155911.7911.4411.551559156011.77(Imperial Edict)1560156110.811561156211.0111.531562156612.29411.551566157212.421572157311.7612.331573157511.6811.111575157612.671576157810.611578157910.621579158211.401582158310.931583158511.631585158610.661586158712.031587158911.211589159011.861590159011.321590159110.951591159311.181593159411.7012.341594159610.9011.501596159711.781597159712.161597159811.291598159911.051599160110.9011.861601160211.8812.221602160311.6412.241603160512.1512.011605160512.491605160611.921606160712.611607160812.1611.041608160812.461608161012.5412.21610161113.3212.081611161213.5212.301612161312.351613161312.291613161512.0313.9012.311615161712.581617161812.111618161912.101619162013.341620162112.51621162212.651622162311.6411.741623162413.421624162412.581624162612.651626163010.311630163113.421631163312.651633163415.101634163514.801635163615.361636163715.101637163813.3914.381638164014.491640164313.515.371643164514.1316451648164816511651165214.131652165314.131653165614.71165616601660166314.431663166516.4714.391665166712.881667166914.4815.131669167914.911679169015.131690

To treat of these countries in detail.

THE NETHERLANDS IN SIXTEENTH CENTURY

During the period under consideration, the seventeenth century especially, the monetary history of the Netherlands supplies the key to that of the surrounding nations. The history of her monetary exchanges has yet to be written, and of her Mint ordinances very little is accessible, as compared,e.g., with France. But this is more than compensated by the numerous "plakkaats" or proclamations of the tariff of coins, which are to us practical indicators of the rates of exchange. The Netherlands, as has been already said, were the centre of European commerce in the sixteenth and seventeenth centuries, as the Italian States had been in the fourteenth and fifteenth; and every change in the precious metals or in the coins showed itself in the Antwerp Bourse as surely and swiftly as to-day in London. As prompt to take knowledge of these changes as Florence had been two centuries earlier, the authorities tabulated the various coinages which were current in the Low Countries,—and practically that meant the coinage of commercial Europe,—tariffed them against their own by proclamation, and instantly accommodated themselves to each new change or variation of value by a new proclamation and a new tariff. These proclamations, therefore, give us the measure and course of the monetary movements of the time in fullest and most welcome details.

It has been already shown that this action of the government of the Netherlands has a twofold aspect. From one side it expresses and regulates the natural flow and ebb of commerce, just as exchange rates and bullion remittances do to-day. And in this sense it was perfectly normal, healthy, and sound, more especially in so far as it provided for the gradual drawing away overplus metal to the East. But the Governments of Europe were yet under the spell of the delusion as to a balance of trade payable in gold—that delusion which was, later, dignified in history by the name of the mercantile theory. Nor had they yet lost the traces of that mediæval craft and lawlessness which rose from, and prompted to, the mere desire of robbing or pilfering their neighbour's store of precious metal as the first act of self-defence. Further than this the monetary system of Europe—unconsciously bimetallic and with an appalling variety of ratio prevalent at the same moment in different places—lay open, helpless and defenceless, and inviting to the bullionist, financier, or arbitragist. In so far as this element of national greed and dishonesty, or private and unprincipled gain, entered into the legislative enactments of the Netherlands, it condemns them as mercenary, and the monetary straits or tightness, not to say crisis and panic which ensued, as unnecessary and therefore in the highest degree lamentable.

SIXTEENTH-CENTURY ARBITRAGE

In a blind way the age saw what was going on behind the financier's screen, however little it understood the theory of it. In many a sixteenth-century document, preserved among the State papers in the Record Office at London, abuse is piled on the Netherlands for their practices in enticing away the coin of the realm. One of the correspondents of the Privy Council in the days of Elizabeth, 1575, writes thus from the Netherlands: "The Low Country merchants return great stores of money hither by exchanges, and by the proceeds, as the exchange may serve for their purposes, they send away her majesty's coin and bullion into the Low Countries in great quantities, and the rather by reason of the Hollanders trading with the East, by which means the realm will be secretly robbed, if it be not prevented." Twenty years later the whole subject was again gone into, for the fiftieth time, for the advice of the English Privy Council, and it was shown how "foreign exchangers contrived, by arranging a rise or fall in particular monies, to undervalue English monies, and draw them out of the kingdom. Prevention has been vainly attempted by Acts of Parliament, by sending over Sir Thomas Gresham to the Low Countries to complain, and by establishing the office of exchanger, which was discontinued as injurious to the State. A bank was proposed, but the Queen had not to spare the £100,000 needed to start it. It is now proposed to settle the exchange at 10 or 12 per cent., to be fixed yearly, according to the state of affairs, 20 per cent. or more being sometimes paid now."

Thenaïvetéand helplessness of the suggestionscontained in these concluding words need not blind us to the real and pressing gravity of the monetary situation to which they relate, and which periodically beset each and every European Government throughout the centuries under consideration.

Such, therefore, is the aspect of these monetary ordinances or plakkaats of the Netherlands in the sixteenth and seventeenth centuries.

To speak of them in detail.

The first of the Low Country proclamations, containing anevaluatie, or tariff, is dated 2nd January 1516, and it marks the commencement of the influence of the American discoveries. (See table below.) By the succeeding proclamation of 4th February 1520, golden reals were substituted for the golden florin. Its provisions remained nominally in force for twenty years or so, but almost immediately the movement towards higher prices made itself felt, and it was in consequence of this, and after fruitless negotiations with the merchants of Antwerp, that CharlesV.issued a series of four closely consecutive proclamations (1521, March 1522, 19th June 1524, 25th November 1525). The first three concern gold, the last only bears witness to the rise of silver by attempting to check it and call it down. Similarly, in his ordinance of 10th December 1526, he enacted that the price ruling on the 4th February 1520 should be again used, and should be reached at two drops or intervals, so as to create the less disturbance between debtor and creditor. Theordinance proved fruitless, and was twice renewed, in 1531 and 1539. In spite of them all, the rise in prices against which the authorities tried to fight, continued and had to be recognised. By the ordinance of 11th July 1548 a higher limit of values was permitted. Then, for a dozen years or so, attempts were made, by the proclamations of 23rd March 1552 and 24th October 1559, to make those prices of 1548 the basis, and to compel a return to it in the future, while recognising temporarily the higher prices ruling at the moment. And so the process repeats itself continually—a further rise of prices, complaints of the disorder in the currency and exchanges, and a newevaluatieissued, regulating the exchanges at the higher rate for the moment, and providing for the reduction of prices to previous limits, from and after such and such a date.

In the accompanying table wherever two figures are coupled together thus,2 41 19}the higher figure represents the price ruling at the date of the ordinance, the lower figure is the price to which return was to be made from and after some date fixed thereby. A simple glance at the tables will show how futile and foredoomed was every such attempt to rule and compel the exchanges. For the explanation of these tables it will be sufficient to give the dates of the Netherlands ordinances, premising that up to 1586 the series was applicable to the whole Netherlands, but that from that date there is a separate series for theSeven United Provinces, and for the Spanish Netherlands.

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