A Gambling Man: Charles II's Restoration Game (30 page)

But in his enjoyment of wit Charles was at one with his court and the polite culture of the Town. ‘I do believe’, one author would write, ten years hence, ‘that never in any Age was there such a violent and universal thirst after the Fame of being Wits.’
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To win, as Charles well knew, even in ‘the governing part’, in matters of state, you must keep your audience guessing.

Proverbs, from a traditional pack of cards, reprinted in 1780

WHEN CHARLES RODE
through London on the eve of his coronation, the triumphal arches proclaimed the City’s hopes. As he approached the ‘
East-India
House’, a youth dressed in Indian garb, accompanied by two black slaves, offered him tribute, while another rode up on a camel, with panniers full of jewels, spices and silks. The King, the Indian-robed speaker declared, was a phoenix, a treasure. He had the power to revive English trade, put paid to the Spanish and overcome the Dutch, and make London the emporium of ‘All that’s rich’, from all nations under the sun. Further on, singers dressed as sailors hailed Charles as ‘Great Neptune of the Main’, claiming that the Royal Navy could whip the French, the Dutch, the Spanish and the Turk and ‘seize on their Goods and Monies’.
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England’s greatness would spread across the seas and the world’s wealth flood to her shores.

The view from the Custom House in the port of London, or the docks in Newcastle or the quays of Bristol, made the dream seem possible. Lone ships and convoys set out in the spring heading north for the Baltic or south to the Mediterranean, carrying tin from Cornwall, coal from Newcastle, pilchards from Plymouth, cloth and woollens from Devon and East Anglia. (Fine serges and light woollen ‘stuffs’ proved surprisingly popular in Italy.) In autumn the boats returned, unloading timber, pitch and tar from Norway, carpets from Turkey, currants from Spain, oil from Italy, wine from Bordeaux. Meanwhile larger and faster ships crossed the Atlantic to the West Indies and the American plantations, bringing back tobacco and sugar. And the beautiful Indiamen unfurled their great sails, setting off southwards, sailing round the Cape of Good Hope into the Indian Ocean, carrying bullion, cloth, lead and iron, and returning with holds fragrant with pepper and spices, heavy with calico and chintzes.

The Royal Exchange, London, engraved by Hollar in 1644, with the crowd of merchants, including two Russians in fur hats on the left, and a woman selling broadsides

Luxuries filled the galleries of the Royal Exchange, the symbol of British mercantile glory. The fine Exchange had been built in Elizabeth’s day by Sir Thomas Gresham, and his emblem, a golden grasshopper, topped its tall clock tower. Around the courtyard were four storeys of walkways, crammed with small shops. Beneath, in the arched colonnade with its marble columns, the merchants made their deals. The nonconformist clergyman Samuel Rolle remembered it with wondering nostalgia. ‘How full of riches’, he wrote, ‘was that Royal Exchange’:

Here, if anywhere, might a man have seen the glory of the world in a moment. What artificial thing could entertain the senses, the fantasies of men, that was not there to be had? Such was the delight that many gallants took in that magazine of all curious varieties, that they could almost have dwelt there (going from shop to shop like bee from flower to flower), if they had but had a fountain of money that could not have been drawn dry. I doubt not but a Mohamedan (who never expects other than sensual delights) would gladly have availed himself of that place, and the treasures of it, for his heaven, and have thought there was none like it.
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A host of languages and accents could be heard here and London’s own merchants included many of foreign origin. Several protestant merchant families had come from northern France and from Flanders, like the Rycauts, the Papillons, the Thierrys and the Houblons. The Huguenot Thomas Papillon, an outspoken East India director and Kentish landowner, had been brought to London as a child. Sir John Houblon, who lived with his large family in his mansion off Threadneedle Street, came originally from Lille. Houblon was one of five merchant brothers, known for their religious devotion (two were later founding directors of the Bank of England, of which Sir John was the first governor). They traded chiefly with Portugal, Spain, Italy and the Mediterranean, but also held directorships with the Levant and the East India companies.

Another group, the Jewish dealers, had arrived from Portugal, Spain and Amsterdam in the mid-1650s. They were protected by an agreement with Cromwell but although their synagogue in Cree Lane was now one of the sights of the town they still had no written permission to settle. In exile, Charles had promised Jewish bankers in Amsterdam toleration in return for a loan, and he kept his promise. In 1664, when the Conventicle Act was passed, forbidding religious meetings, some hostile merchants and nobles saw this as a way to eject the Jews, or at least to extract money for arguing on their behalf. But their leaders appealed directly to Charles, who, wrote Rabbi Jacob Sasportas, ‘chuckled and spat at the business; and a written statement was issued from him, duly signed, affirming that no untoward measures had been or would be initiated against us’.
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Charles remained generous towards the Jewish community throughout his reign, granting naturalisation to those who asked. Portuguese Jews helped Charles organise the payment of Catherine’s dowry and the great speculators Duarte Da Silva and Gomes Rodrigues used London as a base to trade in bullion, jewels, wines and sugar across the world. The turnover of Jewish wholesale dealers was reckoned to be a twelfth of the total commerce of all the three kingdoms, paying thousands in customs dues each year.

Keen to foster London’s trade, Charles had set up Privy Council committees soon after he arrived, including the Council of Foreign Plantations and the Council of Trade. The establishment of the latter in 1661 was a notable step, since it made public matters previously kept tight in royal hands, like the regulation of coinage, foreign trade and patents and monopolies.
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The Council of Trade also promised to hear suggestions and complaints from all sides, thus reassuring the landed classes that their interests would not be swamped by those of the merchants. The letter patent made the King’s enthusiasm clear. Charles had set up the council, it said, ‘well weighing how considerable a part of our crown and government doth arise from foreign and domestic trade, in that they are the chief employment and maintenance of our people’.
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He would be closely involved, open to suggestions, keen to ‘bend our earnest affections & consultations of our own royal person’. And for the first few years he was closely involved, and the council was as open as he had promised. Thereafter, like many of Charles’s offices, it became less accessible, moving to Whitehall and operating more as a royal advisory body.
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Meanwhile ambassadors sallied out across Europe promoting trade agreements with Holland, France, Spain, Italy, the German princedoms and the Scandinavian states. In 1662 Andrew Marvell set out for Russia as secretary to Charles Howard, Earl of Carlisle, trekking to Archangel in the Arctic north, on a long and trouble-dogged embassy to regain the privileges which the Tsar had cancelled after the execution of Charles I.

With the king committed to their interests, merchants could dream of great fortunes. The conditions for creating individual wealth were all there: the common law sanctioned property rights and the making and enforcing of contracts; the networks of the companies and guilds ensured a good exchange of information; manufacturers were improving techniques, and boat-builders designing better cargo ships – although in this they lagged behind the Dutch. What they needed most, however, was cheap money to invest, and here the English faced problems.

In the past, people had financed new ventures in a haphazard way by borrowing from relatives or rich connections, setting loans against the securities of bonds and mortgages. In the late middle ages, London was home to foreign bankers who lent money on a large scale to the crown, first the Italians (who gave their name to Lombard Street) and then the Germans, and bankers from Genoa and Venice and Amsterdam. But now the bankers were home-grown. In these Restoration years, powerful money-men who had risen under Cromwell strode down the Privy Gallery at Whitehall, or received harassed Treasury officials and navy clerks in their panelled offices around Cheapside. This was yet another example, like the work of the Royal Society and the boom in the book trade, where Charles’s regime built on the flurry of ideas and innovation during the Interregnum.

Some of the new bankers were former scriveners, notaries who negotiated loans and then began lending their own capital. But by far the most influential were the London goldsmiths. For a century or more, the goldsmiths had sold fine silver and gold plate to the nobility and gentry, agreeing to take it back as security against loans when times were hard. From pawn-broking they moved to full-scale banking. People deposited cash with them, receiving a low rate of interest, and the goldsmiths lent it out again at a higher rate, set by law at six per cent. The rate had fallen sharply since the start of the century, but, to the chagrin of English investors, interest rates still remained higher than in Holland, where merchants or builders or farmers could borrow at four per cent. Risk also played its part then, as now, in establishing the rate: London’s stayed high partly because financiers had lent to the crown, which often defaulted on its debts. The merchants now argued loudly that they needed cheap money, to invest at low cost in order to bring substantial profits home. In 1668, the ruthless entrepreneur Josiah Child firmly declared that ‘all countries at this day are richer and poorer in exact proportion to what they pay, or have usually paid, for the Interest of Money’.
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Child and others complained that London had no financial quarter to rival Amsterdam, where the financiers clustered together, exchanging information and arranging spectacular deals in goods and currency. (Their journal, the
Price Courant
, even published exchange rates twice weekly.) But the London goldsmiths were catching up. They not only gave interest on deposits, but also discounted bills of exchange, accepted the new-fangled cheques, first issued in 1659, and issued ‘goldsmiths notes’, promissory notes that could change hands and circulate freely, creating a fluid movement of capital.
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They also lent to each other, helping each other out when exceptionally large sums were needed or when the cash-flow failed, and they kept careful tallies so that they knew how exposed they were every week, every day and even, in some crises, every hour.

The goldsmiths had made overtures to Charles as soon as Monck reached London in January 1660, and at the Restoration he was extremely careful to bind them to his side. The most senior was the grey-haired Thomas Vyner, whose shop had provided the gold cup for Charles’s own baptism in 1630. He did not look, however, like a natural ally. In 1649, as Sheriff of London, he had attended the execution of Charles I; later he carried the sword of state when Cromwell rode through the city.
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In the first Interregnum he made a fortune through East Indian investments, handled the money from confiscated Irish estates and became Lord Mayor. Yet in 1660 all his Cromwellian past was politely brushed aside. Almost as soon as he landed, Charles made Vyner a baronet, and he also smiled on his nephew Robert, who had just become a full member of the family firm at the Vine in Lombard Street.

Equally swiftly, Charles enlisted the help of Vyner’s former apprentice Edward Backwell, who had been Cromwell’s Treasurer of Dunkirk from 1658. Charles kept Backwell in this role and used him to handle the sale of Dunkirk in 1662, collecting and disbursing the great chests of silver shipped over from France. Backwell’s heavy ledgers, the first run of banking accounts in Britain, with neat lists of incoming sums on the left-hand page and payments on the right, show the Dunkirk money flowing out in rivers and streams, the greatest sum to Carteret for the navy, the second largest to Stephen Fox for the king.
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Backwell also handled the farming of the London Excise and the revenue from the Hearth Tax, as well as gifts to ambassadors and the distribution of prize money from captured ships. Every name one can think of in public life appears in his accounts, from Lord Mayors and ministers to courtiers and poets: Albemarle and Ashley, Bennet, Buckingham, Buckhurst, Dryden, Downing, Lauderdale, Pepys, Ormond and Orrery and on to the end of the alphabet.

The same names appear in the customer books of Sir Francis Child the elder, another goldsmith turned banker (no relation to Josiah Child). In his ledgers everything is recorded from the purchase of silver buckles and gold toothpicks, to huge loans to aristocratic estates.
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The Vyners, Backwell, Child and others like them had all worked their way up through apprenticeships to become freemen of the Goldsmith’s Company. Backwell’s forebears were Bedfordshire yeomen; Child was the son of a West Country clothier; the Vyners came from a ‘middling’ Warwickshire family; Francis Meynell, whom Pepys called ‘the great money-man’, began as a fresh-faced apprentice from Derbyshire. Such men represented a new power in the land, one that would force the court more and more into partnership with the City. Decisions of state began to hang on the views expressed in the counting houses and coffee-houses of the Square Mile. The Vyners, for example, advanced over a million pounds to Ormond in his first years as Lord Lieutenant of Ireland, and he fumed over their high ‘Irish rates’ of ten per cent. Robert Vyner also lent a fortune to the king, beginning with £30,000 for the coronation regalia. In 1662, with Meynell and Backwell, he collected the same sum to repay the Russian loan that the Muscovy ambassadors came to collect. In 1665, he would stump up £330,000 for the navy, household and guards. He was not doing this out of a sense of national duty: his rates were a standard ten per cent on outstanding government debts, sometimes reaching fifteen or even twenty per cent. By the end of the decade the loans ran into millions and the interest payments were, theoretically, vast. He took risks, and there were unseen rapids ahead, but for now at least, the securities seemed safe.