ou want to know where they obtained the money in order to lend it? Well, from all those who had money to deposit—the merchants, the widows and orphans whose small incomes were derived from money lodged with the bankers; these all received a small interest from the goldsmiths, who lent their money again at a much larger interest; so you can see that when the king refused to pay, it was not possible either to return the principal or pay the interest to those of whom they had borrowed. Great was the distress, therefore, not only among the merchants, but among all who had lodged their money with the goldsmiths. The voice of the people grew so loud and angry, that at length Charles found himself compelled to pay the interest, though he never paid back the capital. In 1625 King Charles sent the Duke of Buckingham to Holland to borrow £300,000 on the pledge of the Crown jewels.
You can see by what I have told you how difficult it was for the people to find secure places wherein to deposit their money, and how ruinous was the interest demanded if, on the other hand, they desired to borrow. Great, indeed, was the need of some establishment capable of advancing money at a reasonable rate on the security of Parliamentary grants. One or two private bankers of high repute strove to improve matters. Especially may I mention Child and Hoare. To the former by common consent belongs the celebrity of having the first banking house, which was established in 1620 on the site of the present building; and I am proud to bear testimony to the fact that from that year to the present day, all through the troublous times of banking, it has maintained the high position and respectability in which Mr. Francis Child left it.[2] Hoare’s bank was established in 1680.
These men did something towards steadying the money market; but it was left to me to clear the country of the insecurity and rapacity which had so long obtained.
Before proceeding with my personal history, I should like to explain a certain method of keeping accounts before I came into power, which accounts I strictly paid up as they fell due. It was known by the name of tallies,[3] or tally.
“The word ‘tallies’ is derived from the French, and signifies cutting. The tallies were pieces of wood cut in a peculiar manner to correspond or tally. For example, a stick of hazel or some other wood, well dried and seasoned, was cut square and uniform at each end. The sum of money which it bore was cut in notches (a notch signifying so much, according to the size) in the wood by the cutter of the tallies, and likewise written upon two sides of it by the writer of the tallies. The tally was cleft in the middle by the deputy chamberlain with a knife and mallet, whereby it made two halves, each half having a superscription and a half-part of the notch or notches. Thus cut, one part was called a tally, the other a counter-tally. When these two parts came afterwards to be joined, if they were genuine they fitted so exactly as to be parts one of the other.”[4]
You will understand, therefore, “that the notches corresponded to the sum for which it was an acknowledgment; the writing on the other sides containing the date and the payer. The rod was so cut that each half contained one written side and half of every notch. One part was kept in the Exchequer and the other was circulated.
“When the time of payment arrived, the two parts were compared, and if they tallied or corresponded all was right; if not, there was some fraud, and payment was refused. Tallies were not finally abandoned in the Exchequer till 1834.”
Having thus cleared the ground, I will proceed with my story.
You already know of the sensation which my appearance in the world caused, but I have not yet told you that I started in life with the sanction and support of the Government, and that I received my Charter of Incorporation, as it was called, on the day I was born.