Promoters and Projectors—Government loans—Commencement of Bank of England—Character of a Stock Jobber—Jonathan’s—Hoax temp. Anne—South Sea Bubble—Poems thereon.

We are apt to think that company promoters and commercial speculation are things of modern growth, but Projectors and Patentees (company promoters and monopolists) were common in the early seventeenth century; and we find an excellent exposition of their ways and commodities in a poetical broadside by John Taylor, the Water poet, published in 1641. It is entitled The complaint of M. Tenter-hooke the Proiector, and Sir Thomas Dodger, the Patentee. Under the title is a wood-cut, which represents a Projector, who has a pig’s head and ass’s ears, screws for legs, and fish hooks for fingers, bears a measure of coal, and a barrel of wine, on his legs respectively, tobacco, pipes, dice, roll tobacco, playing cards, and a bundle of hay slung to his body, papers of pins on his right arm, and a measure for spirits on his left arm, a barrel and a dredger on the skirts of his coat. With his fish hook fingers, he drags bags of money. This is Tenter-hooke, who is saying to his friend Sir Thomas Dodger, who is represented as a very well dressed gentleman of the period:

“I have brought money to fill your chest,
For which I am curst by most and least.”

To which Sir Thomas replies:

“Our many yeares scraping is lost at a clap,
All thou hast gotten by others’ mishap.”
If any aske, what things these Monsters be
‘Tis a Projector and a Patentee
: Such, as like Vermine o’re this Lande did crawle,
And grew so rich, they gain’d the Devill and all.

Loe, I, that lately was a Man of Fashion,
The Bug-beare and the Scarcrow of this Nation,
Th’ admired mighty Mounte-banke of Fame,
The Juggling Hocus Pocus of good name;
The Bull-begger who did affright and feare,
And rake, and pull, teare, pill, pole, shave and sheare,
Now Time hath pluck’d the Vizard from my face,
I am the onely Image of disgrace.
My ugly shape I hid so cunningly,
(Close cover’d with the cloake of honesty),
That from the East to West, from South to North,
I was a man esteem’d of ex’lent worth.
And (Sweet Sir Thomas Dodger,) for your sake,
My studious time I spent, my sleepes I brake;
My braines I tost with many a strange vagary.
And, (like a Spaniell) did both fetch and carry
To you, such Projects, as I could invent,
Not thinking there would come a Parliament.
I was the great Projector, and from me,
Your Worship learn’d to be a Patentee;
I had the Art to cheat the Common-weale,
And you had tricks and slights to passe the Seale.
I took the paines, I travell’d, search’d and sought,
Which (by your power) were into Patents wrought.
What was I but your Journey man, I pray,
To bring youre worke to you, both night and day:
I found Stuffe, and you brought it so about,
You (like a skilfull Taylor) cut it out,
And fashion’d it, but now (to our displeasure)
You fail’d exceedingly in taking measure.
My legs were Screws, to raise thee high or low,
According as your power did Ebbe or Flow;
And at your will I was Screw’d up too high,
That tott’ring, I have broke my necke thereby.
For you, I made my Fingers fish-hookes still
To catch at all Trades, either good, or ill,
I car’d not much who lost, so we might get,
For all was Fish that came into the Net.
For you, (as in my Picture plaine appeares)
I put a Swine’s face on, an Asses eares,
The one to listen unto all I heard,
Wherein your Worship’s profit was prefer’d,
The other to tast all things, good or bad,
(As Hogs will doe) where profit may be had.
Soape, Starch, Tobacco, Pipes, Pens, Butter, Haye,
Wine, Coales, Cards, Dice, and all came in my way
I brought your Worship, every day and houre,
And hope to be defended by your power.

Sir Thomas Dodgers’ Answer.

Alas good Tenter-hooke, I tell thee plaine,
To seeke for helpe of me ‘tis but in vaine:
My Patent, which I stood upon of late,
Is like an Almanacke that’s out of Date.
‘T had force and vertue once, strange things to doe,
But, now, it wants both force and vertue too.
This was the turne of whirling Fortune’s wheele,
When we least dream’d we should her changing feele.
Then Time, and fortune, both with joynt consent,
Brought us to ruine by a Parliament;
I doe confesse thou broughtst me sweet conceits,
Which, now, I find, were but alluring baits,
And I, (too much an Asse) did lend mine eare
To credit all thou saydst, as well as heare.
Thou in the Project of the Soape didst toyle,
But ‘twas so slippery, and too full of oyle,
That people wondered how we held it fast
But now it is quite slipp’d from us at last.
The Project for the Starch thy wit found out,
Was stiffe a while, now, limber as a Clout,
The Pagan weed (Tobacco) was our hope,
In Leafe, Pricke, Role, Ball, Pudding, Pipe, or Rope.
Brasseele, Varina, Meavis, Trinidado,
Saint Christophers, Virginia, or Barvado;
Bermudas, Providentia, Shallowcongo,
And the most part of all the rest (Mundungo[58])
That Patent, with a whiffe, is spent and broke,
And all our hopes (in fumo) turn’d to smoake,
Thou framdst the Butter Patent in thy braines,
(A Rope and Butter take thee for thy paines).
I had forgot Tobacco Pipes, which are
Now like to thou and I, but brittle ware.
Dice run against us, we at Cards are crost,
We both are turn’d up Noddies,[59] and all’s lost.
Thus from Sice-sinke, we’r sunke below Dewce-ace,
And both of us are Impes of blacke disgrace.
Pins pricke us, and Wine frets our very hearts,
That we have rais’d the price of Pints and Quarts.
Thou (in mine eares) thy lyes and tales didst foyst,
And mad’st me up the price of Sea-coales hoyst.
Corne, Leather, Partrick, Pheasant, Rags, Gold-twist,
Thou brought’st all to my Mill; what was’t we mist?
Weights, Bon[60] lace, Mowstraps, new, new, Corporation,
Rattles, Seadans,[61] of rare invented fashion.
Silke, Tallow, Hobby-horses, Wood, Red herring,
Law, Conscience, Justice, Swearing, and For-swearing.
All these thou broughtst to me, and still I thought
That every thing was good that profit brought,
But now all’s found to be ill gotten pelfe,
I’le shift for one, doe thou shift for thyselfe.

The first loans to Government, in a regular form, took the form of Tontines, so called from their inventor Lorenzo Tonti. A Tontine is a loan raised on life annuities. A number of persons subscribe the loan, and, in return, the Government pay an annuity to every subscriber. At the death of any annuitant, his annuity was divided among the others, until the sole survivor enjoyed the whole income, and at his death, the annuity lapsed. As an example, a Mr Jennings, who died in 1798, aged 103—leaving behind him a fortune of over two millions—was an original subscriber for £100 in a Tontine: he was the last survivor, and his income derived for his £100 was £3000 per annum. Our National Debt began in 1689—by that, I mean that debt that has never been repaid, and dealings in which, virtually founded Stockbroking as a business. The Bank of England started business on 1st Jan. 1695, and, from that time, we may date the methodical dealing in Stocks and Shares. Of course there were intermediaries between buyer and seller, and these were termed “Stock brokers.” They first of all did business at the Exchange, but as they increased in number their presence there was not desirable, and they migrated to ‘Change Alley, close by. These gentry are described in a little book, published in 1703, called, Mirth and Wisdom in a miscellany of different characters.[62]

“A Stock Jobber

“Is a Rational Animal, with a sensitive Understanding. He rises and falls like the ebbing and flowing of the Sea; and his paths are as unsearchable as hers are. He is one of Pharaoh’s lean kine in the midst of plenty; and, to dream of him is, almost, an Indication of approaching Famine. He is ten times more changeable than the Weather; and the living Insect from which the Grasshopper on the Royal Bourse was drawn, never leap’d from one Place to another, as he from one Number to another; sometimes a Hundred and a half is too little for him; sometimes Half a hundred is too much; and he falls seven times a Day, but not like David, on his knees, to beg pardon for former Sins, but to be made capable of sinning again. He came in with the Dutch, and he had freed us from as great a Plague as they were, had he been so kind as to have went out with them. He lives on the Exchange, but his Dwelling cannot be said to be the Place of his Abode, for he abides no where, he is so unconstant and uncertain. Ask him what Religion he professes, he cries, He’ll sell you as cheap as any Body; and what Value such an Article of Faith is of, his Answer is, I’ll give you as much for a Debenture, as the best Chapman thereabout shall. He is fam’d for Injustice, yet he is a Master of Equity in one particular to perfection, for he cheats every Body alike, and is Equal in all his Undertakings. The Den from which this Beast of Prey bolts out is Jonathan’s Coffee House, or Garraway’s; and a Man that goes into either, ought to be as circumspect as if in an Enemy’s country. A Dish of tea there, may be as dear to him as a good Purchase, and a Man that is over reach’d in either, tho’ no Drunkard, may be said to have drank away his Estate. He may be call’d a true Unbeliever, and out of the Pale of the Church, for he has no Faith. Is a meer Tolandist in secular Concerns, at the very minute that he is ready to take up any Goods upon Trust that shall belong to his Neighbour. St Paul’s Cathedral would be a Mansion-House fit for a Deity indeed, in his Opinion, did but the Merchants meet there; and he can give you no subtantialler a Reason for liking Salter’s Hall better than the Church, than because of its being a House of Traffick and Commerce, and the Sale being often held there. He is the Child of God in one Sense only, and that is by reason of his bearing His Image, but the Devil in many, for he fights under his Standard. To make an end of a Subject that is endless; he has the Figure of a Man, but the Nature of a Beast; and either triumphs over his Fellow Adventurers, as he eats the Bread of other People’s Carefulness, and drinks the Tears of Orphans or Widows, or being made himself Food for others, grows, at last, constant to one place, which is the Compter, and the fittest House for such an unaccountable Fellow to make up his Accounts in.”

Jonathan’s was, especially, the Coffee House which stock jobbers frequented. Addison, in the first number of the Spectator, says, “I sometimes pass for a Jew in the assembly of Stock Jobbers at Jonathan’s”; and Mrs Centlivre has laid one of the scenes in her Bold Stroke for a Wife, at Jonathan’s: where, also, was subscribed the first foreign loan, in 1706.

There was a Stock Exchange hoax in the reign of Queen Anne. A man appeared, galloping from Kensington to the City, ordering the turnpikes to be thrown open for him, and shouting loudly that he bore the news of the Queen’s death. This sad message flew far and wide, and dire was its effects in the City. The funds fell at once, but Manasseh Lopez and the Jews bought all they could, and reaped the benefit when the fraud was discovered. In 1715, too, a false report that the Pretender had been taken, sent the Funds bounding up, to the great profit of those who were in the secret of the hoax.

About this time the demon of gambling was rampant, every one wanted to find a short road to wealth; naturally, there were plenty of rogues to ease them of their money, but the most colossal stroke of gambling was the South Sea Bubble, the only parallel to which, in modern times, is the Railway Mania, in 1846.

The South Sea Company was started in 1711, to have the monopoly of trade to the South Seas, or South Coast of America, a region which was, even then, believed to be an El Dorado. As a trading company it was not successful, but, having a large capital, it dealt with finance. On 22nd Jan. 1720, a proposal was laid before Parliament that the Company should take upon themselves the National Debt, of £30,981,712, 6s. 6-1/2d. at 5 per cent. per annum, secured until 1727, when the whole was to be redeemable, if Parliament so chose, and the interest to be reduced to 4 per cent., and “That for the liberty of increasing their Capital Stock, as aforesaid, the Company will give, and pay into his Majesty’s Exchequer, for the purpose of the Public, and to be applied for paying off the public debt provided for by Parliament, before Christmas, 1716, the sum of three millions and a half, by four equal quarterly payments, whereof the first payment to be at Lady Day 1721.” On April 7, the South Sea Company’s Bill received the Royal Assent, the £100 shares being then about £300.

On April 12, the directors opened their books for a subscription of a Million, at the rate of £300 for every £100 Capital, which was immediately taken up, twice over. It was to be repaid in five instalments of £60. Up went the shares with a bound; yet, to raise them still higher, the Midsummer dividend was to be declared at 10 per cent., and all subscriptions were to be entitled to the same. This plan answered so well, that another million was at once raised at 400 per cent.; and, in a few hours, a million and a half was subscribed at that rate. The Stock went up higher and higher, until, on the 2nd of June, it reached £890. Then, so many wanted to sell, that, on the same afternoon, it dropped to £640. The Company set their Agents to work, and, when evening came, the Stock had been driven up to £750, at about which price it continued until the bank closed on the 22nd June.

Very soon, a third Subscription was started, at the rate of £1000 for every £100, to be paid in ten equal payments, one in hand, the other nine, quarterly. The lists were so full that the directors enlarged it to four millions Stock, which, at that price amounted to £40,000,000. These last subscriptions were, before the end of June, sold at about £2000 premium; and, after the closing of the transfer books, the original Stock rose to over £1000 per cent. At the same time, the first subscriptions were at 560, and the second at 610 per cent. advance.

This set every one crazy, and innumerable “bubble,” or cheating, companies were floated, or attempts made thereat. Speculation became so rampant that, on June 11, the King published a Proclamation declaring that all these unlawful projects should be deemed as common nuisances, and prosecuted as such, with the penalty of £500 for any broker buying or selling any shares in them. Among these companies was one “for carrying on an undertaking of great advantage, but nobody to know what it is.” Another was “for a wheel for perpetual motion, one million”; and another “for the transmutation of quick silver into a malleable fine metal.” Society was, for a brief time, uprooted.

The apogee of the Company had been reached: from this time its downfall was rapid. The Stock fell, and fell. The aid of the Bank of England was invoked, but it came too late; goldsmiths and brokers began to abscond. On December 12, the House of Commons ordered that the Directors of the South Sea Company should, forthwith, lay before the House an account of all their proceedings; and, on Jan. 4, 1721, a Secret Committee of the House was ordered to report upon the Company. Then Knight, the cashier of the Company, absconded; and a reward of £2000 was offered for his apprehension. On Feb. 15, the Parliamentary Committee made their first report—and a pretty one it was—bribery all over the place, and especially among the members of the Government. The bubble was pricked and thousands were ruined. Certainly, the fortunes of those directors, who had any, were seized for the benefit of the swindled, and only a small percentage of their wealth was allowed them for their subsistence. Finally, it was settled that the £7,000,000 which the Company stood pledged to pay over to the Government, should be remitted, and every Shareholder should receive £33, 6s. 8d. on £100 Stock: all else being irretrievably lost. Over the misery entailed on the avaricious public who were gulled, it is best to draw a veil, and use the episode as a warning.

Swift wrote a poem 60 verses long, on The South Sea Project, 1721, from which I extract the following:

“There is a gulf, where thousands fell,

Here all the bold adventurers came,

A narrow sound, though deep as Hell,—

’Change Alley is the dreadful name.

Nine times a day it ebbs and flows,

Yet he that on the surface lies,

Without a pilot, seldom knows

The time it falls, or when ‘twill rise.

Subscribers, here, by thousands float,

And jostle one another down;

Each paddling in his leaky boat,

And here they fish for gold, and drown.

·······

Meantime, secure on Garraway cliffs,

A savage race, by shipwrecks fed,

Lie waiting for the foundered skiffs,

And strip the bodies of the dead.”

There were street ballads, of course, such as The Hubble Bubbles, A Ballad, by Mr D’Urfey, and one which I give in extenso. A South-Sea Ballad: or, Merry Remarks upon Exchange Alley Bubbles. To a new tune, call’d The Grand Elixir: or The Philosopher’s Stone discovered:

In London stands a famous Pile,

And near that Pile, an Alley,

Where Merry Crowds for Riches toil,

And Wisdom stoops to Folly:

Here, Sad and Joyful, High and Low,

Court Fortune for her Graces,

And, as she Smiles, or Frowns, they show

Their Gestures and Grimaces.

Here Stars and Garters do appear,

Among our Lords, the Rabble,

To buy and sell, to see and hear,

The Jews and Gentiles squabble.

Here crafty Courtiers are too wise

For those who trust to Fortune,

They see the Cheat with clearer Eyes,

Who peep behind the Curtain.

Our greatest Ladies hither come,

And ply in Chariots daily,

Oft pawn their Jewels for a Sum,

To venture’t in the Alley.

Young Harlots, too, from Drury Lane,

Approach the ’Change in coaches,

To fool away the Gold they gain

By their obscene Debauches.

Long Heads may thrive by sober Rules,

Because they think and drink not;

But Headlongs are our thriving Fools,

Who only drink and think not:

The lucky Rogues, like Spaniel Dogs,

Leap into South Sea Water,

And, there, they fish for golden Frogs,

Not caring what comes a’ter.

‘Tis said that Alchimists of old,

Could turn a brazen kettle,

Or leaden Cistern into Gold,

That noble, tempting Mettle:

But, if it here may be allowed

To bring in great with small things

Our cunning South Sea, like a God,

Turns nothing into all things.

What need have we of Indian Wealth,

Or Commerce with our Neighbours,

Our Constitution is in Health,

And Riches crown our Labours:

Our South Sea Ships have golden Shrouds

They bring us Wealth, ‘tis granted,

But lodge their Treasure in the clouds,

To hide it ‘till it’s wanted.

O, Britain! bless thy present State,

Thou only happy Nation,

So oddly rich, so madly Great,

Since Bubbles came in Fashion:

Successful Rakes exert their Pride,

And count their airy Millions;

Whilst homely Drabs in Coaches ride,

Brought up to Town on Pillions.

Few Men, who follow Reason’s Rules,

Grow Fat with South Sea Diet;

Young Rattles, and unthinking Fools,

Are those that flourish by it.

Old musty Jades, and pushing Blades,

Who’ve least Consideration,

Grow rich apace, whilst wiser Heads

Are struck with Admiration.

A Race of Men, who, t’other Day

Lay crush’d beneath Disasters,

Are now, by Stock brought into Play,

And made our Lords and Masters:

But should our South Sea Babel fall,

What Numbers would be frowning,

The Losers, then, must ease their Gall

By Hanging, or by Drowning.

Five Hundred Millions, Notes and Bonds,

Our Stocks are worth in Value,

But neither lye in Goods, or Lands,

Or Money, let me tell ye.

Yet, tho’ our Foreign Trade is lost,

Of mighty Wealth we vapour,

When all the Riches that we boast,

Consists in Scraps of Paper.