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Swedish Prelude

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At Spes non Fracta

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Abstract

Sweden lost its position of power in the Baltic at the beginning of the 18th century. When in 1687 Charles XII, then fifteen years of age, succeeded his father, Saxony, Poland, Denmark and Russia considered the moment ripe to deprive Sweden of the areas on the other side of the Baltic Sea which it had conquered during the 17th century. In the early stages of the Great Northern War which ensued, the Swedish king achieved major successes, but eventually the sheer expanse of Russia and the superiority of the armies of Czar Peter proved too much for the limited Swedish forces. At the Peace of Nystad, in 1721, the Baltic states and, with them, the hegemony in the Baltic region passed into the hands of Russia, and from then on Russian influence became a permanent feature there. In the 18th century this unpredictable and expansive country was to exert ever-increasing pressure on its neighbours.

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References

Chapter Two Page 73

  1. Ingvar Andersson, A History of Sweden (London, 1955), 261.

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Page 74

  1. Eli F.Heckscher, An Economic History of Sweden (Cambridge, Mass., 1954), 197.

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  2. L.Stavenow, Geschichte Schwedens, 1718–1772 (Gotha, 1908), 350-359. R.Nisbet-Bain, Gustavus III and his contemporaries, II, (London, 1894), 30-31

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  3. Stavenow, Geschichte Schwedens, 364. Van Dillen, ‘Bloeitijd der Amsterdamse Wisselbank,’ 309.

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  4. Stavenow, Geschichte Schwedens, 368-378. Nisbet-Bain, Gustavus III, 11, 30-31. R.Nisbet-Bain, Scandinavia (Cambridge, 1905), 355.

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Page 75

  1. G.A. Amsterdam, Not. Arch., 12380-100, 155. The State Treasury or Comptoir Royal d’Etat, in turn, was dependent upon the revenues of the kingdom. The extraordinary security pertaining to these notes lay in the fact that they became negotiable in the event of Sweden failing to pay.

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  2. Stavenow, Geschichte Schwedens, 388.

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  3. Nisbet-Bain, Gustavus III, 11, 49. Stavenow, Geschichte Schwedens, 395-396. The English and Danish envoys also supported the Caps.

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  4. Ibid., 396. Nisbet-Bain, Gustavus III, 11, 49. While the riksdag was in session, units of the Danish and Russian fleets were cruising off the Swedish coast. Stavenow, Geschichte Schwedens, 401.

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Page 76

  1. Ibid., 403. Request to the king by the riksdag, dated 17th November 1769, to negotiate a loan abroad, in G.A. Amsterdam, Not. Arch., 12395-136.

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  2. Elias, Vroedschap, n, 1057. Cancelled contract between the Swedish king and Hope & Co. and Fizeaux Grand & Co., late November-early December 1780.

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  3. G.A. Amsterdam, Not. Arch., 12394-889.

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  4. Supra, 76, note 1.

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  5. As coins of relatively high value were also minted from copper, these were met in the form of blocks of the metal weighing up to nearly 20 kilograms. Because copper coins were costly to transport, a severe fall in the value of paper money was necessary to bring about a flight of capital in coin. Heckscher, Economic History, 88, 197.

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Page 77

  1. Nisbet-Bain, Gustavus III, 11, 64. This transaction does not seem to have resulted in a public loan.

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  2. Stavenow, Geschichte Schwedens, 427-433; Nisbet-Bain, Gustavus III, 11, 105-140.

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  3. Nisbet-Bain, ibid., 117. The name of Grill & Co. also appears in the deeds of settlement issued by Hope to the Swedish government in later years. In the 18th century the Dutch silver ducat was commonly used in trading circles in the Baltic. It was equal in value to 2½ guilders and for this reason was also referred to as a rixdollar. H.Enno van Gelder, De Nederlandse munten (Utrecht, 1965), 149, 225, 259-260.

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  4. Nisbet-Bain, Gustavus III, 11, 159.

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Page 78

  1. Nisbet-Bain, ibid., 166-167; Hecksher, Economic History, 198; Stavenow, ‘Der aufgeklärte Absolutismus des 18en Jahrhunderts in Schweden,’ Bulletin of the International Committee of Historical Sciences v, iii, 20 (1933), 766.

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  2. Daniel Hogguer resigned from the firm in 1773, whereupon Jan Jacob Horneca entered into a partnership with Henri Fizeaux under the name of Horneca Fizeaux & Co. Elias, Vroedschap, 11, 1057.

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  3. G.A. Amsterdam, Not. Arch., 12426-725, 765.

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  4. The first million guilders were repaid after 10 years, the second after 12 years and the third after 15 years. The 1770 loans, like those negotiated in 1767, ran for 10 years.

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  5. Vide photo of the annual settlement. The text reveals that the bonds could be obtained in exchange for others dated 1767, which were redeemable in 1777. This implied a profit to Sweden of 1% on conversion for the year 1777.

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Page 79

  1. Letter of 1st December 1787, from Hope & Co. to Baron de Ruuth, P.C. ‘87, 297; Nisbet-Bain, Gustavus III, 11, 169.

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  2. Nisbet-Bain, ibid., 170 et seq.

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  3. Horneca resigned from the firm in April 1779. Fizeaux formed a new partnership with George Grand, a Swiss. Elias, Vroedschap, 11, 1057. At the time of the seizure of power by Gustav III, Grand was living in Stockholm. It was at his house that De Vergennes met the leaders of the conspiracy, and in recognition of his services he was given a title by the King of France. It was thus extremely appropriate that he should become part of a firm concerned with negotiating loans for Sweden. Diary and autobiography of John Adams, edited by L.H.Butterfield, IV (Cambridge, Mass., 1961), 64-65.

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  4. The term commenced on 1st March 1780. Three debentures, each of 100,000 rixdollars, issued by the State Treasury were given by way of special security. The principal debenture dated from 13th September 1779. In: G.A. Amsterdam, Not. Arch., 12451-24.

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Page 82

  1. Diversen Documenten, laast 1700-begin 1800, 23.

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  2. Div. Doc., 25.

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Page 83

  1. Div. Doc., 26-28; the bonds relating to this loan were dated 7th February 1781. They were, however, numbered from 751 to 1250 and thus corresponded to the bonds of the loan of 1st December 1780. The debentures issued by the State Treasury bore the date 14th June 1780, the date of the bonds relating to the suspended loan. The principal debentures of the two loans also bore the same date, namely 10th November 1780.

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  2. Div. Doc., 28-29; Hope and Fizeaux received a commission of 7%, of which 1% was passed on to the entrepreneurs. The latter, however, were not required to pay interest for the period 1st-15th June on that part of their share which had not been claimed and paid up. The loan was for 16 years commencing on 1st March 1782, and bore interest at 4 %. The interest for the period 1st March to 1st June accrued to the Swedish king. Of the Bargum loan, cf 125,000 had been repaid by 1781.

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  3. Nisbet-Bain, Gustav III, 11, 258-259. The political situation in Europe in 1784 also did not favour a war with Denmark.

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  4. G.A. Amsterdam, Not. Arch., 12469-658.

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  5. Div. Doc., 32. Hope and Fizeaux had negotiated a 5 % loan for Spain in 1782.

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  6. Ibid., 33.

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Page 84

  1. Volkmar subscribed cf 250,000, Ten Kate & Berck cf 500,000 and Hope cf 275,000.

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  2. G.A. Amsterdam, Not. Arch., 12476-83. Dr.Sandor Baumgarten, ‘Emprunts de Suède à Amsterdam,’ Tijdschrift voor Geschiedenis, LXXVII (1964), 439-440.

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  3. Baumgarten, ibid., 440. Regarding Liljencrantz’s preference for Hasselgreen, see letter of 27th December 1786, from J. Andersson, Gothenburg, to Hope & Co., Amsterdam.

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  4. P.J.Blok, Geschiedenis van het Nederlandsche Volk, III (Leiden, 1914), 585.

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  5. Div. Doc., 50-51. The principal debenture bore the date 20th October 1784; the loan was for 15 years, commencing on 1st December 1784. The public were to be invited to subscribe during the month of February, and the loan was officially opened on 1st March 1785. The interest due on the bonds in the period 1st December 1784 to 1st March 1785, accrued to the Swedish Crown.

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Page 85

  1. The floating million was thus also included, so that the deductions from the shares taken by the entrepreneurs diminished.

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  2. Div. Doc., 49.

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  3. Div. Doc., 49. The entrepreneurs thus enjoyed a respite until 1st September.

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  4. Div. Doc., 49-50. The contracts with the Swedish Crown reveal that Fizeaux Grand & Co. became Henri Fizeaux & Co. on 1st January 1785. The change escaped the notice of Elias. (Elias, Vroedschap, 11, 1057-1058).

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  5. Hope and Fizeaux’s first instalment to Liljencrantz, of cf 250,000, was not paid until 10th March 1785, at the earliest.

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  6. Baumgarten, ‘Emprunts de Suède,’ 442. The text ‘Nous appliquerons d’ailleurs au remboursement en question votre assignations sur nous …’ and, previously, ‘… et en les dirigeant, comme pour le premier million …’ shows clearly that we are concerned with the second million.

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  7. Baumgarten, ibid., 442. Cf. previous note.

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  8. Baumgarten, ibid., 442.

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Page 86

  1. Baumgarten, ibid., 443.

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  2. Financial relations between the Swedish Crown and the house of Smets in Antwerp certainly existed in 1787.

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  3. The peace preliminaries were signed in Paris on 20th September 1785. Blok, Geschiedenis van het Nederlandsche Volk, III, 589.

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  4. The principal debenture was dated 12th December 1785. The loan bore interest at 4½% and was for a period of 15 years, commencing on 1st February 1786. G.A. Amsterdam, Not. Arch., 12481-9. The principal sum was to be furnished in four equal instalments during the months of January to April inclusive and was payable by 70-day drafts. Div. Doc., 68-69.

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  5. The contract with the entrepreneurs was signed on 31st December 1785. Div. Doc., 129-130.

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  6. Nisbet-Bain, Gustavus III, 11, 5.

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Page 87

  1. Nisbet-Bain, ibid., 289.

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  2. To the letters in 1786 Hope appended the name J. von Jacobsen. Letters in the same handwriting and dated 1788 and 1789, however, bear the signature of Jacob Andersson.

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  3. 27th September 1786. J.Andersson, Gothenburg, in a letter to Hope & Co., Amsterdam.

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  4. Letter dated 27th December 1786, from J.Andersson, Gothenburg, to Hope & Co., Amsterdam.

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  5. M.Marion, Histoire Financière de la France depuis 1715, 1 (Paris, 1914), 31. The name of the intermediary in Paris was De Montessuy.

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  6. The balance consisted of 12,520 ‘paniers’ or 1,513,793 Amsterdam pounds. The letter book refers to 1,252 paniers, but this is presumably due to an error in transcription since paniers weighing 600 kilograms do not exist. A weight of 60 pounds, however, is normal. (Information supplied by T.H.Kimm, Curator of the Niemeyer Netherlands Tobacological Museum, Groningen). Letter of 14th Augustus 1787 to Baron de Ruuth, P.C. ‘87, 86.

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  7. Letter of 19th June 1787 to Baron de Ruuth, P.C. ‘87, 4.

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  8. Letter of 19th June 1787 to Baron de Ruuth, P.C. ‘87, 4.

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Page 88

  1. Letter of 23rd June 1787 to Baron de Ruuth, P.C. ‘87, 6. Ferdinand Grand was also banker to the United States. Butterfield, Diary of John Adams, IV, 64.

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  2. Hope foresaw a fall in prices if the auction were publicly announced in advance.

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  3. Letter of 14th August 1787, to Baron de Ruuth, P.C. ‘87, 86 et seq. Four days later Hope wrote to say that a report had been received from Grand stating that the Fermiers had broken off the negotiations and had even refused to bid at the public auction. This auction had meanwhile been cancelled (letter of 18th August 1787 to Baron de Ruuth, P.C. ‘87, 95).

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  4. Letter of 7th July 1787 to Baron de Ruuth, P.C. ‘87, 26. Letter of 17th July 1787 to Baron de Ruuth, P.C. ‘87, 43, 46 and 47.

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Page 89

  1. Letter of 14th August 1787 to Baron de Ruuth, P.C. ′87, 90.

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  2. ‘La Couronne de Suède, S/Cte Courant de Tabac.’ The account totalled cf 393,604.7.8. After deduction of Hope’s costs, including those concerned with arranging the auction, the sale netted cf 210,801.5.0 for Cohen. The advantage to the latter lay in the fact that the import duty did not become due until the tobacco had been sold, thus avoiding a substantial loss of interest on the (high) ad valorem duty. Moreover, because tobacco was subject to a rapid loss in value (estimated at between 4 % and 8 % between the moment of importation and the moment of sale), the fact that the duty, ad valorem, did not become due until the time of sale was an advantage in itself. Cohen’s ultimate plan was to supply much larger quantities of tobacco to Sweden. His correspondents there would store the tobacco in the Crown warehouses at the various ports during the period of freedom from duty, and would sell it from there in the presence of a customs officer, who would collect the duty from the purchasers. The plan misfired. Cohen was obliged to pay immediately and was later reimbursed. Faced with this situation, he declared that he could not compete with the tobacco smugglers. Letter of 16th February 1788 to Baron de Ruuth, P.C. ′88, 162-164.

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  3. Letter of 23rd June 1787 to Baron de Ruuth, P.C. ′87, 9.

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  4. Letter of 28th July 1787 to Baron de Ruuth, P.C. ′87, 60-62. The repayment to Hasselgreen probably concerned the loan of 1776 (vide page 78).

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Page 90

  1. Letter of 28th July 1787 to Baron de Ruuth, P.C. ′87, 62-63.

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  2. The conditions referred to here were incorporated, without modification, into the official contract dated 25th August 1787 (Div. Doc., 239). The principal debenture bore the date 8th August 1787. G.A. Amsterdam, Not. Arch., 12487-452. On 7th August, De Ruuth reported that the king had agreed to the conditions. Letter of 25th August 1787 to Baron de Ruuth, P.C. ′87, 111.

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  3. Div. Doc., 235. The commission to be paid to the entrepreneurs was based on the sums converted or provided by them.

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  4. Letter of 1st December 1787 to Baron de Ruuth, P.C. ′87, 298-299. This letter was despatched to Sweden by express messenger on the same day. A copy was sent by ordinary post on 4th December. Following publication of the Berigt (Report) of the loan by Hasselgreen, Hope repeated their objections. Letter of 3rd December 1787 to Baron de Ruuth, P.C. ′87, 316.

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Page 91

  1. Infra Appendix C-11.

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  2. Letter of 5th January 1788 to Baron de Ruuth, P.C. ′88, 15.

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  3. Elias, Vroedschap, II, 1058. In 1798 the outstanding portions of all Swedish loans floated in the Netherlands were merged into a single fund totalling cf 15,000,000, the interest on which was raised to 5%. The management of the fund was entrusted to the erstwhile competitors, Hogguer & Co. (successors to Hogguer Grand & Co.) and Jan and Carl Hasselgreen. The terms provided for half a million guilders of the fund to be repaid annually. The loans arranged by Hope and Fizeaux in the years 1784, 1786 and 1787 were embodied in the fund. When, in 1808, Sweden again became embroiled in a war with Russia, the Swedish government suspended the payment of interest and principal money on the fund in the Netherlands. The country’s foreign loans were reduced by two-thirds by the riksdag held at Orebrö in 1812, and the balance was subsequently abrogated. In 1814, following the Napoleonic wars, steps were taken in the Netherlands with a view to recouping the debt and the accumulated interest. A memorandum on the subject was sent to the Netherlands envoy in Stockholm. In this, the sum owing was stated to be cf 14,700,000. However, many bonds had been purchased for Swedish account since 1808-at a low price, of course. Whether these had been bought by the Swedish government or by private investors was not clear. Of the managers of the fund in 1798, little remained: Hogguer & Co. had been completely liquidated, and Jan and Carl Hasselgreen had, according to the memorandum, ‘lost all credit and substance, so that it cannot be anticipated that the public would willingly support the continuation of this intermediary.’ In 1815 a meeting of those with interests in the Swedish loans was held, and this led to G. van de Poll being despatched to Sweden with instructions to plead the cause of the Dutch bondholders. He succeeded in moving the authorities to recognize one-third of the debt, repayment of which ensued in 1816. His efforts to obtain the interest owed failed, however: J. J.Weeveringh, Handleiding tot de geschiedenis der Staatsschulden, 11 (Haarlem, 1855), 781-783. Cf. instructions sent to ‘Mr. de Zuylen’ in Stockholm, 12th November 1814.

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  1. Rijksuniversiteit te Groningen, Groningen, The Netherlands

    Marten Gerbertus Buist

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© 1974 Martinus Nijhoff, The Hague, Netherlands

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Buist, M.G. (1974). Swedish Prelude. In: At Spes non Fracta. Springer, Dordrecht. https://doi.org/10.1007/978-94-011-8858-6_2

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  • DOI: https://doi.org/10.1007/978-94-011-8858-6_2

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