THE STORY OF HOLLAND. _________ XXIV. THE BANK OF AMSTERDAM. DURING the century which intervened between the truce of 1609 and the treaty of Utrecht, the Dutch occupied the most conspicuous place in Europe. They were courted by rival powers, and during the devastating wars of the seventeenth century, were for a long time, the centre of European commerce and European finance. Their principal city, Amsterdam, was deemed to be the largest and by far the most opulent in Europe, far surpassing those splendid cities of the Middle Ages, Florence, Genoa, and Venice. The business of Europe was transacted on the Amsterdam Exchange, and the warehouses of this town, built on piles driven into the swampy soil, were stored with the products of the world. In their cities the Dutch were carrying on those manufactures of the finest fabrics for which Flanders and Italy had once been famous, and piling up the spices of the Indies, of which for a time they possessed the monopoly. The wealth and the trade of the Dutch East India Company was more fruitful than the treasures which the kings of Spain had extorted from their conquests. It was the principal trading, the principal manufacturing country in the world. LUTHERAN CHURCH AT AMSTERDAM. It was also the country in which improved agriculture was most thoroughly developed. The Dutch had not, indeed, land enough to grow grain for the maintenance of the densely peopled republic, and they had to save and keep by incessant watchfulness much of the soil of their country from the ever-present danger of the sea. But as soon as ever the armistice began, and the people had rest from war, they began to pump out the waters of the Beemster Lake, and soon recovered no less than eighteen thousand acres of rich meadow land from what had been a vast expanse of shallow water. Their cattle were the finest in Europe, and the produce of their dairies found a ready market in foreign countries. On the land which they had conquered from the foreign enemy and the sea, they laboured with the diligence and the success of market gardeners. They supplied all Europe with the means of gratifying the fashion which they set of ornamental and domestic horticulture. For a long time they exported all the best garden produce to their neighbours. In course of time they extended the cultivation of winter roots from the garden to the field, and gradually taught European nations how to preserve cattle in sound condition through the winter, and to banish scurvy and leprosy by the constant supply of wholesome fresh diet. The cultivation of the turnip and potato, with other products of the same character, has rendered it possible that three times as many persons could live in security on the same area of land, as were maintained with great risks of famine before these capital discoveries were made. It is difficult for us to realize what were the scourges which afflicted the world, before the Dutch found out winter roots, and brought them to comparative excellence. It was nearly a century before English farmers began generally to copy the Dutch model. It was more than a century before their familiar practices were adopted in the agricultural economy of other nations. It is impossible to overrate the benefits which Dutch enterprise and the spread of Dutch discoveries had on the health of the world. When they had carried the cultivation of winter roots to this pitch of excellence, as well as taught ornamental gardening, they betook themselves to the discovery and improvement of what are called the artificial grasses, which, by supplying more abundant fodder to animals, and much more as well as more nutritious hay, again rendered it possible to increase stock upon land. The Dutch discovered the use of clover, red and white saintfoin, lucerne, and either naturalized them or improved them. The English writers on husbandry are constantly calling the attention of English farmers to the marvellous progress which the Dutch were making in these directions, and commenting on the folly and slothfulness which forebore to imitate them. The population of England was more than doubled in the seventeenth century, by adopting the agricultural inventions of the Dutch. The extension of their discoveries in the eighteenth century again doubled the population. REMBRANDT. But keen as the Dutch were after the profits to be obtained by trade, by manufactures and husbandry, diligent as they were in working out any expedient which might add to the material resources of their country, and the citizens who governed the republic, they were as distinguished in the pursuits of literature and science. Holland was the printing house of Europe, for I believe more books were issued by Dutch publishers in the seventeenth century than by all the rest of Europe put together. Holland supplied the world with the most accomplished jurists, the most painstaking historians, the most skilful physicians, and the most original thinkers in science. There was a prosperous and prolific school of painters in Holland, a most skilful school of engravers, before a single Englishman had attempted either art. The University of Leyden was far more renowned in the seventeenth century than Oxford, Cambridge, or Paris were, and students from all countries crowded into this, the youngest of the great universities. Holland was the origin of modern international law and of modern physic. It was the country from which the best mathematical instruments, the best astronomical instruments, the best nautical instruments could be procured. It discovered the art of cutting and polishing diamonds, and for centuries Amsterdam possessed a monopoly of this art, if indeed it has lost it yet. There was no department of learning or skill in which the Dutch did not excel. It is said that the genius of Milton did not disdain to levy contributions on the poems of the Dutch poet Vondel, and to adopt or imitate some of his happiest verses. It is necessary to state how rapid was the progress of the Dutch as soon as ever their independence was assured. But perhaps the most remarkable of their undertakings was the foundation of the Bank of Amsterdam, the most famous, and for nearly two centuries, the most envied institution which Holland contained. In the days when paper currencies were unknown, and would not have been trusted had they been known, and the most honest governments levied considerable charges on the mintage of the national currency, the more widely the trade of the country extended, the fuller are great mercantile centres of money. It was the object of traders who might have to liquidate the balance of their trade in money to get possession of such currencies as could be paid away with the least loss. Now it is plain that if, say, English gold and silver were exported, the exporter would have to pay the mint charges, for as soon as the money got out of the country, it would be worth no more than the metal which it contained was worth. Any one who may happen to read the books which bill-brokers and dealers used a couple of centuries or more ago, will be surprised to see how many coins in gold and silver, some foreign, some English, still circulated in England, not a few of them centuries old, which a bullion dealer or broker might reasonably expect to be offered him. Now if such a state of things existed in England, there was sure to be a similar set of phenomena in Amsterdam, which I have said was the principal exchange of the world. Far back in the Middle Ages, Venice had established a bank, which should receive the coins of all nations, and give warrants to a those persons who deposited such coins, which warrants should circulate from hand to hand, just as bank notes do now. Three centuries after the Bank of Venice was founded, a similar institution was established at Genoa, on a somewhat similar basis. In 1609, the year of the truce, the Bank of Amsterdam was founded, and before the end of the century was known to have metallic deposits with it to the amount of $180,000,000, a treasure more prodigious than any European financier at that time thought could be possibly accumulated. The notes issued by the Bank were supposed to be, and in theory were exactly equal in amount to the specie or metallic money deposited in the strong-room of the Bank. But the notes of the Bank always bore a premium, due to the convenience of the absolutely guarded security which the holder of the note possessed. Then the Bank charged a small sum on every account which was opened with it, a small sum for negotiating bills and transferring balances, besides the profit which they derived from their own subscribed capital and their customers’ money at call. The Bank was under the management of the Amsterdam corporation, the chiefs of which examined the treasure annually and made oath that it was of the full amount at which the managers of the Bank affirmed it to be. It was seen that the well-being of this great commercial centre was so much the interest of the Amsterdam municipality, that they could be more safely trusted with the control of the institution than any State official could be. When nearly a century afterwards, the project of starting a great central Bank in England was entertained, it was thought for a long, time that the system under which the Bank of Amsterdam was managed should be the model of a Bank to be established in London. In the end, and fortunately so, other counsels prevailed, for in the seventeenth century London had not been so completely educated in the principles of commercial honour as to make the Amsterdam experiment a safe or convenient model for English practice. It is remarkable that not a few of the first directors of the Bank of England were Flemish settlers in London, who, driven, out for their religion, brought over with them the intelligence, sagacity, and integrity of Netherland finance. The reputation of the Bank of Amsterdam received a remarkable confirmation in 1672. In this year Louis XIV., having secured by heavy bribes the complicity and assistance of Charles II. of England, declared sudden war on the Dutch. It was perhaps the most infamous war ever waged, the most unprovoked, and the most unexpected. The King of France was at this time at the height of his power. The King of England had been in what was supposed to be firm alliance with Holland, whose Stadtholder, afterwards William III. of England, was his nephew. The administration of Holland was in the hands of the brothers De Witt, who were supposed to have been wilfully negligent of affairs when the war broke out. The Dutch were panic-struck at the calamity which came on them, and the political enemies of the De Witts goaded the populace on into murdering the two statesmen, a crime to which it is to be feared William was privy, and by which he certainly profited. The Dutch saved themselves from permanent ruin by a prodigious self-inflicted calamity. They cut the dykes, laid the country under water, and baffled the invader. They punished Charles or rather his people for the king’s perfidy. Now, in this crisis there was a run on the Bank of Amsterdam. But the city magistrate took the alarmed depositors into the treasury of the Bank, and showed them its store untouched. Among the pieces of money which lay there were masses of coin which had been scorched and half melted in the great fire which many years before had occurred in the Stadthouse. The panic was allayed, the merchants were satisfied, and the reputation of the Bank became higher than ever. But when the French overran Holland in the early days of the great Continental war, all the treasure was gone. The government of Amsterdam had lent it, despite the fundamental principle of the Bank, to the Dutch East India Company, as was rumoured.