From William Short
Paris Nov: 12. 1791
Since my last of the 8th. inst. sent by the French packet, the person expected from Antwerp1 of whom I then spoke to you has arrived. This letter written in haste & despatched by the post of to-day in the possibility of its arriving at L’Orient in time for the packet, is merely to inform you of the result of my interview with Mr. Wolf of Antwerp the name of the person in question.
I informed you some time ago that I had authorized his opening a loan at 4½ p. cent interest & 5. p. cent commission.2 At that time no attempt had been made by the Emperor to reduce the rate of interest & circumstances in general were not so favorable to such an object as at present. Of course as Mr. Wolf had not opened the loan but had desired as a condition that I should stipulate not to open any more in Holland at an higher rate of interest, I thought myself founded to consider my former authorization given him as so far void that I might propose to him new terms of commission determining however to grant the 5. p. cent if the rate of interest could not be lowered without it. He insisted for some time on the necessity of being allowed at least 5. p. cent on account of the loan for the U.S. being a new thing, the greater commission he is consequently obliged to allow the undertakers &c. &c. I found so many arguments however to oppose to all these that he at length consented & seems well satisfied to take 4. p. cent for commission, all charges &c. as at Amsterdam, with which I am well persuaded you will be highly satisfied as being applied to a loan at a reduced rate of interest. I have always considered it proper to have the charges on the loans reduced with the utmost rigour, more for the credit of the borrowing power than on account of a small economy. The rate of interest being for the most part the same, the real criterion by which the well informed judge of the credit of the several borrowing powers is the commission they pay on their loans.
This loan will be opened so as to date from the 1st of next month & Mr Wolf assures me that it will be carried through with eclat. He had taken all the preliminary measures in such a manner before leaving Antwerp as to put this matter beyond all question in his own mind. The duration of this loan & mode of re-imbursement will be the same as those made at Amsterdam. Mr. Wolf desired that the U. S. should stipulate not to re-imburse any part before a certain number of years, but as he did not seem to think this essential I have determined to preserve that privilege, although there is little probability of its being made use of within the term of five or six years which he desired. The amount of the loan is to be three millions of florins. Mr. Wolf wished much that I should authorize him to extend it on the same conditions to six millions if, as he was well persuaded, he should find it practicable in the course of a few months. I have not consented to this however because I have thought it best to reserve to the U. S. the right of reducing the rate of interest or commission on the next loan if found practicable, & also because if the bankers at Amsterdam should also make the loan which I have authorized them to open for three millions if it can be done previous to the 1st. of January so as to avoid the tax they mentioned to me,3 I shall not consider myself at liberty under your letter of the 1st. of Aug. last, to have any additional sum borrowed at 4½. p. cent interest, exclusive of charges. As you have never said any thing to me expressly about the re-imbursement of the Spanish debt4 & that to the Farmers-general,5 I shall wait until I hear further from you unless it should become essential to attend to them sooner in which case I shall suppose myself implicitly authorized to apply thereto the money which may be on hand.
I know not what effect the opening this loan at Antwerp will have at Amsterdam. It will certainly produce ill humour among those who are employed in our loans there & who have been accustomed to think that their city was entitled to a monopoly of them. As the present situation of the U. S. however with respect to their arrears to the French government & other exigencies puts them above the effects of such ill humour it is probable it will not be shewn.
I have mentioned to you6 that the bankers informed me a tax was to be laid by the Dutch government on all loans made after the 1st. of Jany next & that they were of opinion they could have one undertaken at 4½. p. cent interest previous to that period. I have authorized them in that case to do it provided the commission be fixed at 4. p. cent7 I have as yet no answer, but you may count on being immediately informed of what shall be done in this as well as the loan at Antwerp.
My late letters to you have been of Aug. 8. 23. 30. 31. Sep 3. 23. Oct 10. Nov 8. I have the honor to be most respectfully Sir Your most obedient humble servant
Alexander Hamilton Secretary of the Treasury, Philadelphia.
ALS, letterpress copy, William Short Papers, Library of Congress.
1. Charles John Michael de Wolf.
3. See Willink, Van Staphorst, and Hubbard to Short, August 25, 1791, printed as an enclosure to Short to H, August 31, 1791. This matter is also discussed in Short to Willink, Van Staphorst, and Hubbard, November 11, 1791 (ALS, letterpress copy, William Short Papers, Library of Congress).
4. The Spanish loan of 1781. For a description of this debt, see H to Short, September 1, 1790, note 19.
5. For a description of this debt, see H to Short, September 1, 1790, note 26.
7. Short to Willink, Van Staphorst, and Hubbard, November 11, 1791 (ALS, letterpress copy, William Short Papers, Library of Congress).