_Monetary Excitement.—Approaches to the Stock Exchange.—Gold
Company.—Equitable Loan Company.—Frauds in Companies.—Loan to
Foreign States.—Poyais Bubble._
The excitement of 1824 and 1825 has usually been considered in
reference to banking and the Bank of England. It is the writer’s
present purpose to draw attention to the social and moral evils of
the period; and, by a simple detail of some curious incidents and
dangerous adventures arising out of it, to draw attention to the
great and crying iniquities which obtained.
The readiness with which shares were attainable first created a
class of speculators that has ever since formed a marked feature in
periods of excitement, in the dabblers in shares and loans with which
the courts and crannies of the parent establishment were crowded.
The scene was worthy the pencil of an artist. With huge pocketbook
containing worthless scrip; with crafty countenance and cunning eye;
with showy jewelry and threadbare coat; with well-greased locks and
unpolished boots; with knavery in every curl of the lip, and villany
in every thought of the heart; the stag, as he was afterwards termed,
was a prominent portrait in the foreground. Grouped together in
one corner might be seen a knot of boys eagerly buying and selling
at a profit which bore no comparison to the loss of honesty they
each day experienced. Day after day were elderly men, with shabby
faces and huge umbrellas, witnessed in the same spot, doing business
with those whose characters might be judged from their company. At
another point, the youth, just rising into manhood, conscious of a
few guineas in his purse, with a resolute determination to increase
them at any price, gathered a group around, while he delivered his
invention to the listening throng, who regarded him as a superior
spirit. In every corner, and in every vacant space, might be seen
men eagerly discussing the premium of a new company, the rate of a
new loan, the rumored profit of some lucky speculator, the rumored
failure of some great financier, or wrangling with savage eagerness
over the fate of a shilling. The scene has been appropriated by a
novelist as not unworthy his pen. “There I found myself,” he writes,
“in such company as I had never seen before. Gay sparks, with
their hats placed on one side, and their hands in their breeches
pockets, walked up and down with a magnificent strut, whistling
most harmoniously, or occasionally humming an Italian air. Several
grave personages stood in close consultation, scowling on all who
approached, and seeming to reprehend my intrusion. Some lads, whose
faces announced their Hebrew origin, and whose miscellaneous finery
was finely emblematical of Rag-fair, passed in and out; and besides
these, there attended a strangely varied rabble, exhibiting, in all
sorts of forms and ages, dirty habiliments, calamitous poverty, and
grim-visaged villany. It was curious to me to hear with what apparent
intelligence they discussed all the concerns of the nation. Every
wretch was a statesman; and each could explain, not only all that had
been hinted at in Parliament, but all that was at that moment passing
in the bosom of the Chancellor of the Exchequer.”
The entrance to the Stock Exchange became at last so choked up, that
nothing but a fine of £5 on those who stopped the way had any effect
in dispersing the nuisance.
Among the companies which sprung up daily was one to make gold; and
success was declared to be undoubted. The shares were all greedily
taken; and it was then advertised, that, as the expense of producing
one ounce of gold would cost double the value of the produce, the
company would be dissolved, and the deposits kept to pay expenses.
The capital of a mining company was divided between fifty
proprietors, whose advertisements and puffs were disgraceful. The
meanest utensils of the peasantry were declared to be silver; and,
although there were but ninety-nine mines in the whole district,
the company professed to have purchased 360. In a place containing
5,000 inhabitants, it was affirmed the projector possessed 3,000
mines; and, although they had been previously abandoned after a loss
of £170,000, they were purchased at a high price, and puffed to an
enormous premium.
The Equitable Loan Company was another specimen. In paragraphs
calculated to excite the sympathy of the public, the directors
denounced the profits of the pawnbroker, arraigned his evil
practices, and delicately concluded by hinting that a company formed
upon the most philanthropic principles, and paying forty per cent.,
would soon be formed. The philanthropy might have been proclaimed for
centuries, but forty per cent. was irresistible. The Duke of York
good-naturedly lent his name; members of Parliament were bribed with
shares; and when it was honestly said by one, that the bill would
never pass the House, the triumphant reply given was, “O, we have so
many on the ministerial, and so many on the opposition side, and _we
are sure of the saints_!” The shares, however, went to a discount;
both opposition and ministerial members lost all interest in the
nefarious doings of the pawnbrokers, and the philanthropy of the
saints faded with the fading vision of forty per cent.
The Bolivar Mining Company boasted of “mountains, not mines,” of
metals. A railroad was projected to cross from Dover to Calais. A
loan of £225,000 was proposed for Patagonia; another in derision
advertised for the Lilliputians and Houyhnhnms of Swift’s political
satire; and, to assist them all, a parliamentary steam company
announced to pass more rapidly the bills before the House.
At the formation of another mining company, the utmost magnanimity
was evinced. Rules were passed that none of the directors should
hold more than 200 shares, that all which remained should be brought
honestly into the market, and that every thing should be fair. But
this moderation waxed weaker as their power increased. Thousands of
shares were allotted among the managers, and locked carefully up. A
resolution was passed, that no director or officer should be required
to pay deposits; and then, employing the most respectable brokers to
purchase 1,000 shares with the money of the company, they created
a sensation in the market, and sent them to a premium. The person
who sold the mines to the company was employed to report upon their
value. Opinions the most flattering were given of property absolutely
worthless; and, as a proof of the greediness of one party and the
incapacity of the other, it may be mentioned that a mine, the full
value of which was £400, was purchased at £11,000; and that £121,000
were paid for some which, in almost every instance, were exhausted.
When the Lower Rhine Steam-Navigation Company was announced, it
became a great favorite. Large quantities were sold for the account;
and, as the settling time approached, the premium rose to 28. The
sellers were unable to deliver the shares, and their difficulties
became serious. To meet them, new receipts were printed, closely
imitating the old, the name only of the banker being changed. The
deceit was discovered. A committee sat to elucidate the fraud, and
the supposed concoctor was expelled from the Stock Exchange. The
circumstance excited great attention at the time; and many more were
said to be implicated than it was in the power of the committee to
reach.
Another peculiar feature of the period was to be found in the loans
which preceded and accompanied the memorable era when the public was
wild to lend its capital to foreign states, and the resources of the
borrowers were scarcely regarded. The dividends of the English funds
were scoffed at; the general rate of percentage was increased in
the eyes of the many; Patagonian or Lilliputian securities, which
promised eight per cent., were eagerly looked for; and solid loans
were followed by visionary dividends.
It is a somewhat curious fact, that directly the Navy five per
cents were reduced, the people rushed wildly into new securities
to retrieve their loss, and missed in the promises of the one the
certainty of the other. In 1822, foreign states which, in some cases,
had not even attained the freedom for which they fought, became
creditors to the English public to the amount of £10,150,000.
Chili, after a protracted resistance to the mother country, found
success followed its efforts. Lord Cochrane gave his powerful support
to the navy; and, in 1818, a large tract of coast was declared by him
in a state of blockade. The vigor of his Lordship proved too much
for the royalists; and in a short period a free constitution, with a
popular government, was appointed. But neither the free constitution
nor the popular government could do without money. The Chilian
republic, therefore, borrowed one million of the English people, at
six per cent., and, having received the cash, thought it unnecessary
to pay the interest after 1826.
Peru, a place so interesting to the historic reader, from its early
discovery, its connection with the Spaniards, and the cruelties of
Pizarro, exhibited another specimen of loan-contracting. After years
of violent commotion and of resolute resistance, her independence
was proclaimed; but independence did not produce quiet, and the name
of Bolivar became known in a sanguinary and protracted war. The
Spaniards refused quietly to yield their territory; Lima surrendered
to Spanish troops; and though they were dispossessed by Bolivar,
and Peru became safe from subjugation, doubt, distrust, and anarchy
remained. During this period, the opinion of the English people may
be guessed from the fact, that they lent, in 1822, £450,000 at six
per cent., and that it was contracted for at eighty-eight per cent.
Colombia, which only dates its history as a nation from 1819,
followed. During the contest which preceded its independence, the
insurgents were supplied with implements of war and ammunition from
this country, on the security of debentures bearing ten per cent.
interest; and when the great battle, in which Bolivar the hero of
American independence obtained a complete victory, and consummated
the freedom of Colombia, was fought, the new state borrowed two
millions at eighty-four per cent.
Poyais was another instance of English liberality. £200,000 were
lent on a security so visionary, that not one dividend was ever
paid; while sadder and more sorrowful effects than this followed.
Adventures which commercial history has rarely paralleled marked its
progress; and sufferings, which make us shudder at the recital were
the result of the delusion. But little known out of a particular
circle, the name of the Poyais settlement is never mentioned there
but with feelings of unmitigated detestation.
A Scotchman, named Gregor MacGregor, claiming to be chief of the
clan which bears his name, formed the idea of creating a settlement
on the shores of the Black River. The first appearance of this
man in a public character was in the service of the patriots of
Spanish America. Under the florid title of “General of Brigade of
the Armies of the United Provinces of New Granada and Venezuela,
and General-in-chief of the Armies destined against the Floridas,”
he succeeded in seizing a place known as Amelia Island, which he
proposed to use for purposes of aggrandizement. His views proving
fallacious, he vacated it, and was next heard of as carrying, with
a trifling force, the rich town of Portobello. Here he addressed to
his men a manifesto, in which gold and glory, plunder and patriotism,
equally occupied its periods. Scarcely was it issued, however, ere
the force of MacGregor was surrounded, and the great general could
only save his life by leaving his followers, leaping out of the
window in his shirt, and swimming on board his ship. It is probable
that, during these campaigns, the idea of a settlement first occurred
to MacGregor, as, not long after their conclusion, he proposed a
plan of emigration about to be related; a plan by which colonization
was to extend to that part of America known as the Mosquito country.
The more pleasing title of Poyais was given; the Stock Exchange was
employed to circulate some bonds for a loan of £200,000, at eighty
per cent., on the security of the country; and a land renowned
for its inhospitable climate was puffed into a most undeserving
celebrity. Every device of human ingenuity was practised. Books were
published in which the climate of paradise seemed uncongenial by that
of Poyais. The air was soft and balmy; the sun and sky were alike
fructifying; the soil yearned to yield its fruits; the water ran over
sands of gold. Grain was to grow without sowing. Tortoise-shell,
diamonds, and pearls were plentifully promised; and, to the least
imaginative, the most glowing realms of the Pacific grew pale in
comparison with a region where the sun was ever bright, and the soil
ever yielding. Labor would be superseded, life commenced in hardship
would end in luxury; while gorgeous pictures of “the finest climate
and most fertile place in the world,” excited the undisciplined
imagination of those who had the money necessary to convey them
thither. A song, to be paid for by a company of Poyais lancers, was
chanted in the streets; and the attention of the passing crowd was
attracted by hired ballad-singers. The new home was to be graced with
a knight of the Green Cross, a colonel to command, three legislative
houses to guide its affairs, and a sovereign in the person of Gregor
MacGregor, under the romantic title of Cacique of Poyais. An agent
was employed to make sales of land, and, unhappily, the applicants
were numerous.
Nor was this all. An engraving was published, in which a church
attracted the religious sympathies of some, and a bank the mercenary
thoughts of others; while a theatre gave an air of civilization and
luxury the scene.
Tempted by such descriptions, two hundred and fifty persons embarked
for the land of promise; their lives, their fortunes, and their
families engaged in a scheme which led to destruction. The mere
adventurer was drawn by the beauty of the settlement, the fineness of
the climate, and the hope of making a fortune. The son of the soil,
who had amassed a capital which in Great Britain was unable to save
him from a poor-house, but promised in Poyais a sufficiency for life,
gathered his family together, sold his little furniture, reserving,
with Scottish piety, the Bible which had often consoled his Scottish
hearth, and sought an unknown clime, and a new home for his household
deities. Notes, payable at the Bank of Poyais, were given in exchange
for notes of the Bank of Scotland, under the plea that the latter
would not circulate in the Mosquito country. At length, the barks
which were to conduct the settlers were entered at Leith harbour; and
under different auspices, but with similar results to those which
marked the Darien expedition from the same port, they left the spot
which many were destined to see no more.
Their arrival at the Black River was ominous. As their vessel neared
the new country, a gun was fired, and colors hoisted, to announce
the coming of the emigrants. Every moment they looked anxiously out
for some symptoms of the settlement. Every eye was strained to see
the spire of the church which, in all their dreams, had decorated
their home. Every heart beat with a strange, unwonted anxiety as they
came near the place which had been pictured in such vivid colors. No
great powers of imagination are necessary to conceive their watchful
expectation, as hour after hour passed, and their signals remained
disregarded; or with what a bounding joy they must have seen the
first boat, conveying three white people, approach the ship. The
delusion was brief; and a few words damped their hopes and destroyed
their visions, by the information that it was a savage, sterile,
and desolate spot. Greatly dispirited, they commenced a sad and
sullen journey up the creek. With a burning sun and sky above, no
traces of civilization around, exhausted by the climate, and galled
by insects which the heat of the air nourished in great size, they
proceeded with an almost funereal melancholy to their city of refuge.
The young and ardent asked for gold and gems; the old and cautious
looked at the situation, as, with an anxiety they could not conceal,
they questioned of the soil, its capabilities, and its cultivation.
“Lo!” wrote one who suffered greatly in this disastrous expedition.
“Lo! they said it was all swampy.” By the shades of evening they
landed, and eagerly looked for their future home. It was too dark to
see where the old town of St. Joseph’s formerly stood, as its site
was covered with bushes; and new town there was none, save a couple
of huts, scarcely worthy the name. The next day, the terrible heat
of the climate demanded shelter; but, with every possible exertion,
it occupied three days in clearing sufficient ground for their
habitation. Some wept at sight of the desolate spot; others gnashed
their teeth; while many, yielding to despair, threw themselves on the
ground, and declared themselves abandoned of God and man. The more
hopeful were employed in pitching tents, and had scarcely commenced
landing the goods, on which their safety depended, when a great
gale arose, and the vessel was blown away; nor did they hear of her
until a month had elapsed. Their situation was not only painful and
perilous, but almost hopeless. Hardy as they were, and fit to battle
with any fate, they bore with them those for whose safety they would
gladly have perilled their lives.
The young child and the aged grandsire, alike incapable of
restraining their wants and wishes, were there. The mother and the
infant, the maiden and the matron, had each her representative.
“Bushes were around, and the moon above,” wrote one of the survivors.
Night brought its fearful malaria, day its yet more fearful sun;
and who can imagine the first dig of the spade which, as it sunk
deeply into a soil, half mud and half water, sunk more deeply into
the heart of the unhappy agriculturist. They sowed corn, and the sun
withered it as it rose from the ground. They planted potatoes, and as
they sprung up, they perished from the great heat. A further danger
appeared to the settlers. They were told by the king of the Mosquito
nation, that no grant would be recognized by him, and that they must
acknowledge allegiance or quit his territory. In these circumstances,
it was deemed advisable for a deputation to wait upon his Majesty;
and over sandy beaches they took their way. Weak from want of food,
weary from want of rest, their journey proved one of toil and
trouble. The rainy season was fast approaching; sickness and death
decimated the wanderers; and vainly did they make desperate efforts
to avert their impending fate. One party procured a boat, and started
in search of aid; but, unhappily, forgetting to take water, died ere
it could attain help. Others bought a canoe, and, with Indians to
guide them, were scarcely at sea, ere their treacherous companions
plundered and flung them overboard. Those who remained had yet to be
acclimated; and sickness added to the sufferings they had already
endured. Eating salt provisions, drinking impure water, burning by
day and shivering by night, on the borders of a creek which bred
disease, with a fatal malaria around, they were unable to resist the
ague, which in its worst form seized upon them. Without help and
without hope, far from home, in an inhospitable country, sickness
seized upon one and all. It spared neither age nor sex, neither
strength nor decrepitude. The most resolute fell beneath its power;
the weakest felt its fatal influence; and so fearfully was the colony
at one time situated, that not one could lift a finger to assist the
other. Death ensued; and the only portion of the soil gained by many
was that which gave a grave. The mortality was two thirds.
But these were not the only evils. In September, 1824, it was said,
“Another thing, in the shape of a Poyais loan, has been brought
into the market.” Great as the excitement was, there were not many
disposed to risk their money; but those who did were persons who had
saved a small amount, which, though insufficient to live upon, was
sufficient to excite a desire for more. By this class a considerable
sum was advanced; and the ruin which fell upon them was tremendous.
Their despair was loud, but useless. The Poyais loan was an epoch
from which many dated for the remainder of their lives; and the
figure of one of these unhappy speculators must still be familiar
to some readers, as she wandered daily through the offices of the
Bank of England, and the purlieus of the Stock Exchange, exposed to
all the annoyances which fall upon those who earn their bread in
the public thoroughfares. The Poyais scrip was destined to a lower
employment still. It was used during the mania for foreign loans
in 1836, as a mode of jobbing, the turn in which, suited to the
pockets of those who dealt in it, varied from a halfpenny to a penny,
according to the demand.
Emigration received a great shock; and “to be served like the Poyais
settlers” was a common excuse of the poor and unthinking. If,
however, the Stock Exchange proved indirectly injurious to the great
cause in this instance, one of its members has done more towards its
assistance than is often effected by individual exertion. The efforts
of Mr. Benjamin Boyd will form an important chapter in some future
history of our Australian colonies; as, from his determined energy,
an impulse has been given to emigration which no future official
supineness can eradicate.
Steam-navigation to Australia is greatly desirable; and governments
which, as the present volume proves, often lavish their money
unworthily, should at least be ready to assist in achieving so
great and beneficial a fact. All local objections are overcome. The
difficulty of the “barrier reef” is proved to be an idle dream; and
the time will yet arrive when men will wonder that a few thousand
pounds should for years have retarded steam-navigation to colonies
important alike to the commerce, the comfort, and the civilization of
England. The writer gives the following, to show that the few words
he has said are not unsupported:—
“We unhesitatingly and confidently reply, that for all this the
colony has to thank Mr. Benjamin Boyd. With this gentleman solely the
movement originated; by him and his family it has been maintained
and supported. To this cause Mr. Boyd has devoted his individual
labor; he has lavished his wealth on it; he has enlisted in it the
activity and talent of his own relations, and that of their numerous
and influential friends; he has supplied them with information and
advice, and urged on their flagging zeal, when requisite, up to the
formation of the Colonization Society, and the commencement of the
Colonization Crusade now in progress. And in this course he has
persevered, in spite of obstacles cast in his way by the colonists
themselves, in spite of obloquy and ridicule from men who were to
benefit by his exertions, but on whose ignorance and supineness his
stirring activity was a bitter and ceaseless censure.”