THE AFFAIRS OF SMITHERS & CO.
For more than a year the vast operations of Smithers & Co. had
astonished business circles in London. Formerly they had been considered
as an eminently respectable house, and as doing a safe business; but of
late all this had been changed in so sudden and wonderful a manner that
no one could account for it. Leaving aside their old, cautious policy,
they undertook without hesitation the largest enterprises. Foreign
railroads, national loans, vast joint-stock companies, these were the
things that now occupied Smithers & Co. The Barings themselves were
outrivaled, and Smithers & Co. reached the acme of their sudden glory
on one occasion, when they took the new Spanish loan out of the grasp of
even the Rothschilds themselves.
How to account for it became the problem. For, allowing the largest
possible success in their former business to Smithers & Co., that
business had never been of sufficient dimensions to allow of this. Some
said that a rich Indian had become a sleeping partner, others declared
that the real Smithers was no more to be seen, and that the business was
managed by strangers who had bought them out and retained their
name. Others again said that Smithers & Co. had made large amounts in
California mining speculations. At length the general belief was, that
some individuals who had made millions of money in California had bought
out Smithers & Co., and were now doing business under their name. As
to their soundness there was no question. Their operations were such as
demanded, first of all, ready money in unlimited quantities. This they
were always able to command. Between them and the Bank of England
there seemed to be the most perfect understanding and the most enviable
confidence. The Rothschilds spoke of them with infinite respect. People
began to look upon them as the leading house in Europe. The sudden
apparition of this tremendous power in the commercial world threw that
world into a state of consternation which finally ended in wondering
awe.
But Smithers & Co. continued calmly, yet successfully, their great
enterprises. The Russian loan of fifteen millions was negotiated by
them. They took twenty millions of the French loan, five millions of the
Austrian, and two and a half of the Turkish. They took nearly all the
stock of the Lyons and Marseilles Railroad. They owned a large portion
of the stock of the Peninsular and Oriental Steam Navigation Company.
They had ten millions of East India stock. California alone, which
was now dazzling the world, could account to the common mind for such
enormous wealth. The strangest thing was that Smithers himself was never
seen. The business was done by his subordinates. There was a young man
who represented the house in public, and who called himself Henderson.
He was a person of distinguished aspect, yet of reserved and somewhat
melancholy manner. No one pretended to be in his confidence. No one
pretended to know whether he was clerk or partner. As he was the only
representative of Smithers & Co., he was treated with marked respect
wherever he appeared.
The young man, whether partner or clerk, had evidently the supreme
control of affairs. He swayed in his own hands the thunder-bolts of this
Olympian power. Nothing daunted him. The grandeur of his enterprises
dazzled the public mind. His calm antagonism to the great houses of
London filled them with surprise. A new power had seized a high place
in the commercial world, and the old gods--the Rothschilds, the
Barings, and others--looked aghast. At first they tried to despise this
interloper; at length they found him at least as strong as themselves,
and began to fancy that he might be stronger. A few experiments soon
taught them that there was no weakness there. On one occasion the
Rothschilds, true to their ordinary selfish policy, made a desperate
attempt to crush the new house which dared to enter into rivalry with
them. Widespread plans were arranged in such a way that large demands
were made upon them on one day. The amount was nearly two millions.
Smithers & Co. showed not the smallest hesitation. Henderson, their
representative, did not even take the trouble to confer with the Bank of
England. He sent his orders to the Bank. The money was furnished. It was
the Directors of the Bank of England who looked aghast at this struggle
between Rothschild and Smithers & Co. The gold in the Bank vaults sank
low, and the next day the rates of discount were raised. All London felt
the result of that struggle.
Smithers & Co. waited for a few months, and then suddenly retorted with
terrific force. The obligations of the Rothschilds were obtained from
all quarters--some which were due were held over and not presented
till the appointed day. Obligations in many forms--in all the forms
of indebtedness that may arise in a vast business--all these had been
collected from various quarters with untiring industry and extraordinary
outlay of care and money. At last in one day they were all poured upon
the Rothschilds. Nearly four millions of money were required to meet
that demand.
The great house of Rothschild reeled under the blow. Smithers & Co. were
the ones who administered it. James Rothschild had a private interview
with the Directors of the Bank of England. There was a sudden and
enormous sale of securities that day on Change. In selling out
such large amounts the loss was enormous. It was difficult to find
purchasers, but Smithers & Co. stepped forward and bought nearly all
that was offered. The Rothschilds saved themselves, of course, but at a
terrible loss, which became the profits of Smithers & Co.
The Rothschilds retreated from the conflict utterly routed, and glad to
escape disaster of a worse kind. Smithers & Co. came forth victorious.
They had beaten the Rothschilds at their own game, and had made at
least half a million. All London rang with the story. It was a bitter
humiliation for that proud Jewish house which for years had never met
with a rival. Yet there was no help, nor was there the slightest chance
of revenge. They were forced to swallow the result as best they could,
and to try to regain what they had lost.
After this the pale and melancholy face of Henderson excited a deeper
interest. This was the man who had beaten the Rothschilds--the strongest
capitalist in the world. In his financial operations he continued as
calm, as grave, and as immovable as ever. He would risk millions
without moving a muscle of his countenance. Yet so sagacious was he, so
wide-spread were his agencies, so accurate was his secret information,
that his plans scarcely ever failed. His capital was so vast that it
often gave him control of the market. Coming into the field untrammeled
as the older houses were, he had a larger control of money than any of
them, and far greater freedom of action.
After a time the Rothschilds, the Barings, and other great bankers,
began to learn that Smithers & Co. had vast funds every where, in all
the capitals of Europe, and in America. Even in the West Indies their
operations were extensive. Their old Australian agency was enlarged, and
a new banking-house founded by them in Calcutta began to act on the same
vast scale as the leading house at London. Smithers & Co. also continued
to carry on a policy which was hostile to those older bankers. The
Rothschilds in particular felt this, and were in perpetual dread of a
renewal of that tremendous assault under which they had once nearly gone
down. They became timid, and were compelled to arrange their business
so as to guard against this possibility. This, of course, checked their
operations, and widened and enlarged the field of action for their
rivals.
No one knew any thing whatever about Henderson. None of the clerks could
tell any thing concerning him. They were all new hands. None of them
had ever seen Smithers. They all believed that Henderson was the junior
partner, and that the senior spent his time abroad. From this it began
to be believed that Smithers staid in California digging gold, which he
diligently remitted to the London house.
At length the clerks began to speak mysteriously of a man who came from
time to time to the office, and whose whole manner showed him to possess
authority there. The treatment which he received from Henderson--at once
cordial and affectionate--showed them to be most intimate and friendly;
and from words which were dropped they all thought him to be the senior
partner. Yet he appeared to be very little older than Henderson, if
as old, and no one even knew his name. If any thing could add to the
interest with which the house of Smithers & Co. was regarded it was this
impenetrable mystery, which baffled not merely outriders but even the
clerks themselves.
Shortly after the departure of Langhetti and Beatrice from Holby two men
were seated in the inner parlor of the office of Smithers & Co. One was
the man known as Henderson, the other the mysterious senior partner.
They had just come in and letters were lying on the table.
“You’ve got a large number this morning, Frank?” said the senior
partner.
“Yes,” said Frank, turning them over; “and here, Louis, is one for you.”
He took out a letter from the pile and handed it to Louis. “It’s from
your Brandon Hall correspondent,” he added.
Louis sat down and opened it. The letter was as follows:
“August 15, 1840.
“DEAR SIR,--I have had nothing in particular to write since the flight
of Miss Potts, except to tell you what they were doing. I have already
informed you that they kept three spies at Holby to watch her. One of
these returned, as I told you in my last letter, with the information
that she had gone to London with a party named Langhetti. Ever since
then _they_ have been talking it over, and have come to the conclusion
to get a detective and keep him busy watching her with the idea of
getting her back, I think. I hope to God they will not get her back. If
you take any interest in her, Sir, as you appear to do, I hope you will
use your powerful arm to save her. It will be terrible if she has to
come back here. She will die, I know. Hoping soon to have something more
to communicate,
“I remain, yours respectfully,
“E.L.
“Mr. Smithers, Sen., London.”
[Illustration: “LANGHETTI IS ALIVE.”]
Louis read this letter over several times and fell into deep thought.
Frank went on reading his letters, looking up from time to time. At last
he put down the last one.
“Louis!” said he.
Louis looked up.
“You came so late last night that I haven’t had a chance to speak about
any thing yet. I want to tell you something very important.”
“Well!”
“Langhetti is alive.”
“I know it.”
“You knew it! When? Why did you not tell me?”
“I didn’t want to tell any thing that might distract you from your
purpose.”
“I am not a child, Louis! After my victory over Rothschild I ought to be
worthy of your confidence.”
“That’s not the point, Frank,” said Louis; “but I know your affection
for the man, and I thought you would give up all to find him.”
“Well!”
“Well. I thought it would be better to let nothing interpose now between
us and our purpose. No,” he continued, with a stern tone, “no, no
one however dear, however loved, and therefore I said nothing about
Langhetti. I thought that your generous heart would only be distressed.
You would feel like giving up every thing to find him out and see him,
and, therefore, I did not wish you even to know it. Yet I have kept an
account of his movements, and know where he is now.”
“He is here in London,” said Frank, with deep emotion.
“Yes, thank God!” said Louis. “You will see him, and we all will be able
to meet some day.”
“But,” asked Frank, “do you not think Langhetti is a man to be trusted?”
“That is not the point,” replied Louis. “I believe Langhetti is one of
the noblest men that ever lived. It must be so from what I have heard.
All my life I will cherish his name and try to assist him in every
possible way. I believe also that if we requested it he might perhaps
keep our secret. But that is not the point, Frank. This is the way I
look at it: We are dead. Our deaths have been recorded. Louis Brandon
and Frank Brandon have perished. I am Wheeler, or Smithers, or Forsyth,
or any body else; you are Henderson. We keep our secret because we
have a purpose before us. Our father calls us from his tomb to its
accomplishment. Our mother summons us. Our sweet sister Edith, from her
grave of horror unutterable, calls us. All personal feeling must stand
aside, Frank--yours and mine--whatever they be, till we have done our
duty.”
“You are right, Louis,” said Frank, sternly.
“Langhetti is in London,” continued Louis. “You will not see him,
but you can show your gratitude, and so can I. He is going to hire an
opera-house to bring out an opera; I saw that in the papers. It is a
thing full of risk, but he perhaps does not think of that. Let us enable
him to gain the desire of his heart. Let us fill the house for him.
You can send your agents to furnish tickets to people who may make the
audience; or you can send around those who can praise him sufficiently.
I don’t know what his opera may be worth. I know, however, from what I
have learned, that he has musical genius; and I think if we give him
a good start he will succeed. That is the way to show your gratitude,
Frank.”
“I’ll arrange all that!” said Frank. “The house shall be crowded. I’ll
send an agent to him--I can easily find out where he is, I suppose--and
make him an offer of Covent Garden theatre on his own terms. Yes,
Langhetti shall have a fair chance. I’ll arrange a plan to enforce
success.”
“Do so, and you will keep him permanently in London till the time comes
when we can arise from the dead.”
They were silent for a long time. Louis had thoughts of his own, excited
by the letter which he had received, and these thoughts he did not care
to utter. One thing was a secret even from Frank.
And what could he do? That Beatrice had fallen among friends he well
knew. He had found this out when, after receiving a letter from Philips
about her flight, he had hurried there and learned the result. Then he
had himself gone to Holby, and found that she was at Mrs. Thornton’s. He
had watched till she had recovered. He had seen her as she took a drive
in Thornton’s carriage. He had left an agent there to write him about
her when he left.
What was he to do now? He read the letter over again. He paused at
that sentence: “They have been talking it over, and have come to the
conclusion to get a detective, and keep him busy watching her with the
idea of getting her back.”
What was the nature of this danger? Beatrice was of age. She was with
Langhetti. She was her own mistress. Could there be any danger of her
being taken back against her will? The villains at Brandon Hall were
sufficiently unscrupulous, but would they dare to commit any violence?
and if they did, would not Langhetti’s protection save her?
Such were his thoughts. Yet, on the other hand, he considered the
fact that she was inexperienced, and might have peculiar ideas about
a father’s authority. If Potts came himself, demanding her return,
perhaps, out of a mistaken sense of filial duty, she might go with him.
Or, even if she was unwilling to do so, she might yield to coercion, and
not feel justified in resisting. The possibility of this filled him
with horror. The idea of her being taken back to live under the power of
those miscreants from whom she had escaped was intolerable. Yet he knew
not what to do.
Between him and her there was a gulf unfathomable, impassable. She was
one of that accursed brood which he was seeking to exterminate. He would
spare her if possible; he would gladly lay down his life to save her
from one moment’s misery; but if she stood in the way of his vengeance,
could he--dared he stay that vengeance? For that he would sacrifice life
itself! Would he refuse to sacrifice even _her_ if she were more dear
than life itself?
Yet here was a case in which she was no longer connected with, but
striving to sever herself from them. She was flying from that accursed
father of hers. Would he stand idly by, and see her in danger? That were
impossible. All along, ever since his return to England, he had watched
over her, unseen himself and unsuspected by her, and had followed her
footsteps when she fled. To desert her now was impossible. The only
question with him was--how to watch her or guard her.
One thing gave him comfort, and that was the guardianship of Langhetti.
This he thought was sufficient to insure her safety. For surely
Langhetti would know the character of her enemies as well as Beatrice
herself, and so guard her as to insure her safety from any attempt
of theirs. He therefore placed his chief reliance on Langhetti, and
determined merely to secure some one who would watch over her, and let
him know from day to day how she fared. Had he thought it necessary he
would have sent a band of men to watch and guard her by day and night;
but this idea never entered his mind for the simple reason that he did
not think the danger was pressing. England was after all a country of
law, and even a father could not carry off his daughter against her will
when she was of age. So he comforted himself.
“Well,” said he, at last, rousing himself from his abstraction, “how is
Potts now?”
“Deeper than ever,” answered Frank, quietly.
“The Brandon Bank--”
“The Brandon Bank has been going at a rate that would have foundered any
other concern long ago. There’s not a man that I sent there who has not
been welcomed and obtained all that he wanted. Most of the money that
they advanced has been to men that I sent. They drew on us for the money
and sent us various securities of their own, holding the securities
of these applicants. It is simply bewildering to think how easily that
scoundrel fell into the snare.”
“When a man has made a fortune easily he gets rid of it easily,” said
Louis, laconically. “Potts thinks that all his applicants are leading
men of the county. I take good care that they go there as baronets at
least. Some are lords. He is overpowered in the presence of these lords,
and gives them what they ask on their own terms. In his letters he
has made some attempts at an expression of gratitude for our great
liberality. This I enjoyed somewhat. The villain is not a difficult one
to manage, at least in the financial way. I leave the dénouement to you,
Louis.”
“The dénouement must not be long delayed now.”
“Well, for that matter things are so arranged that we may have ‘the
beginning of the end’ as soon as you choose.”
“What are the debts of the Brandon Bank to us now?”
“Five hundred and fifteen thousand one hundred and fifty pounds,” said
Frank.
“Five hundred thousand--very good,” returned Louis, thoughtfully. “And
how is the sum secured?”
“Chiefly by acknowledgments from the bank with the indorsement of John
Potts, President.”
“What are the other liabilities?”
“He has implored me to purchase for him or sell him some California
stock. I have reluctantly consented to do so,” continued Frank, with a
sardonic smile, “entirely through the request of my senior, and he has
taken a hundred shares at a thousand pounds each.”
“One hundred thousand pounds,” said Louis.
“I consented to take his notes,” continued Frank, “purely out of regard
to the recommendations of my senior.”
“Any thing else?” asked Louis.
“He urged me to recommend him to a good broker who might purchase stock
for him in reliable companies. I created a broker and recommended him.
He asked me also confidentially to tell him which stocks were best, so
I kindly advised him to purchase the Mexican and the Guatemala loan. I
also recommended the Venezuela bonds. I threw all these into the market,
and by dextrous manipulation raised the price to 3 per cent, premium. He
paid £103 for every £100. When he wants to sell out, as he may one day
wish to do, he will be lucky if he gets 35 per cent”
“How much did he buy?”
“Mexican loan, fifty thousand; Guatemala, fifty thousand; and Venezuela
bonds, fifty thousand.”
“He is quite lavish.”
“Oh, quite. That makes it so pleasant to do business with him.”
“Did you advance the money for this?”
“He did not ask it. He raised the money somehow, perhaps from our old
advances, and bought them from the broker. The broker was of course
myself. The beauty of all this is, that I send applicants for money, who
give their notes; he gets money from me and gives his notes to me, and
then advances the money to these applicants, who bring it back to me.
It’s odd, isn’t it?”
Louis smiled.
“Has he no _bona fide_ debtors in his own county?”
“Oh yes, plenty of them; but more than half of his advances have been
made to my men.
“Did you hint any thing about issuing notes?”
“Oh yes, and the bait took wonderfully. He made his bank a bank of issue
at once, and sent out a hundred and fifty thousand pounds in notes. I
think it was in this way that he got the money for all that American
stock. At any rate, it helped him. As he has only a small supply of gold
in his vaults, you may very readily conjecture his peculiar position.”
Louis was silent for a time.
“You have managed admirably, Frank,” said he at last.
“Oh,” rejoined Frank, “Potts is very small game, financially. There is
no skill needed in playing with him. He is such a clumsy bungler that he
does whatever one wishes. There is not even excitement. Whatever I tell
him to do he does. Now if I were anxious to crush the Rothschilds, it
would be very different. There would then be a chance for skill.”
“You have had the chance.”
“I did not wish to ruin them,” said Frank. “Too many innocent people
would have suffered. I only wished to alarm them. I rather think, from
what I hear, that they were a little disturbed on that day when they had
to pay four millions. Yet I could have crushed them if I had chosen, and
I managed things so as to let them see this.”
“How?”
“I controlled other engagements of theirs, and on the same day I
magnanimously wrote them a letter, saying that I would not press for
payment, as their notes were as good to me as money. Had I pressed they
would have gone down. Nothing could have saved them. But I did not wish
that. The fact is they have locked up their means very much, and have
been rather careless of late. They have learned a lesson now.”
Louis relapsed into his reflections, and Frank began to answer his
letters.