So there was no private capital that dared or could take the place of
that of the companies. Elsewhere, in Paris for instance, new districts
have been erected and embellishments have been carried out with the
capital of the country--the money saved by dint of thrift. But in Rome
all was built on the credit system, either by means of bills of exchange
at ninety days, or--and this was chiefly the case--by borrowing money
abroad. The huge sum sunk in these enterprises is estimated at a
milliard, four-fifths of which was French money. The bankers did
everything; the French ones lent to the Italian bankers at 3 1/2 or 4 per
cent.; and the Italian bankers accommodated the speculators, the Roman
builders, at 6, 7, and even 8 per cent. And thus the disaster was great
indeed when France, learning of Italy's alliance with Germany, withdrew
her 800,000,000 francs in less than two years. The Italian banks were
drained of their specie, and the land and building companies, being
likewise compelled to reimburse their loans, were compelled to apply to
the banks of issue, those privileged to issue notes. At the same time
they intimidated the Government, threatening to stop all work and throw
40,000 artisans and labourers starving on the pavement of Rome if it did
not compel the banks of issue to lend them the five or six millions of
paper which they needed. And this the Government at last did, appalled by
the possibility of universal bankruptcy.
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