Gouverneur Morris to William Short36
Paris, July 23, 1792. “I am favord with yours of the seventeenth.… The History you give of DeWolf proves clearly that his Hopes outrun his Judgment. You are however in a Position to see clearly and I am persuaded that however he may deceive himself he cannot deceive you. It appears to me a fortunate Thing that he cannot undertake for large Sums because his Operations will only stimulate the Exertions of the People at Amsterdam. You will be able to feel how their Pulses beat upon it and to act accordingly. You urge me much upon the Subject of the Monies lying in our Bankers Hands, but what can I do? I have already written and said to Monsieur Chambonas that unless a speedy Settlement takes Place the Money intended for them shall be otherwise disposed of. I have received a Letter from the Commissioners of the Treasury desiring to know what Bankers they are to apply to for Money which they say they learn thro different Channels is intended to pay them. I have sent them Copy of what I had written to Monsieur Chambonas. I have no Doubt but that the Payments made in Antwerp are duly registered in their Books as you mention. But how? It seems to me that they must be carried out at some Rate of Exchange and if they mean honestly and know how to act up to their meaning this Rate must be that which they have really obtained. In that Case the Rule for Settlement furnishes itself. And it is with a View to these Circumstances that I desire an Account from them. You tell me that my Powers respecting the french Debt will certainly be competent thereto but yet I do not find any particular Power or Instruction on that Subject unless by Implication under what is said respecting the Payments to be made in America.37 Mr Hamilton has never written a Syllable to me and I shall perhaps be told here-after that I have meddled with Matters not confided to me. You are indeed so kind as to tell me that I possess a greater Share of the Confidence of Government but this is a Point which I much doubt of. The general Presumption is that all the Servants of Government enjoy their Confidence. If we get out of that general Position and come to particular Circumstances I should conclude the Reverse of what you advance and certainly in what regards the present Object your Mission is much more evident than mine. It is our Duty and I am sure it is our Inclination to serve the United States in the most effectual Manner which we can and perhaps it might be well to apply the Monies in Holland to the Payment of a Part of what we owe there. One of the Loans was at six per Cent Interest or more when the Premiums are calculated and if we have as you once mention’d to me the Right of paying it38 I think it would be very well to begin there and let the Creditors know that they might either receive their money or charge their Obligations for others bearing only a common Interest of four per Cent. A similar Operation might be made afterwards on our five per Cent Loans39 and I am thoroughly convincd that we should keep Possession of the greater Part of the Cash so as to be ready to make Payments here in due Season and yet reduce all our Holland Debt to a plain four Per Cent Interest.…”
36. ALS (extract), William Short Papers, Library of Congress.
37. See note 10.
38. Morris is referring to the Holland loan of 1784 for two million guilders. This loan had been negotiated by John Adams. See H to Short, September 1, 1790, note 22. Although this loan bore four percent interest, it was a lottery loan, and the bonus or premiums distributed each year brought the annual interest to more than six percent. Morris was mistaken in thinking the loan could be redeemed at will. According to the terms of the contract, the loan was to run for seventeen years, with redemption beginning in 1801. See also Short to Morris, August 4, 1792, printed below as an enclosure.
39. The Holland loans bearing five percent interest were those of 1782, 1787, 1788, 1790, March, 1791, and September, 1791. For descriptions of these loans, see Willink, Van Staphorst, and Hubbard to H, January 25, 1790; H to Willink, Van Staphorst, and Hubbard, November 29, 1790; H to Short, September 1, 1790; Short to H, February 17, August 31, 1791.