A Dangerous Fortune(27)
Hugh had been brought here at the age of ten by his grandfather, old Seth’s brother. The marble-walled banking hall on the first floor had seemed like a church: huge, gracious, silent, a place where incomprehensible rites were performed by an elite priesthood in the service of a divinity called Money. Grandfather had shown him all around: the carpeted hush of the third floor, occupied by the partners and their correspondence clerks, where little Hugh had been given a glass of sherry and a plate of biscuits in the Partners’ Room; the senior clerks at their tables on the fourth floor, bespectacled and anxious, surrounded by bundles of papers tied with ribbon like gifts; and the juniors on the top floor, sitting at their high desks in lines like Hugh’s toy soldiers, scratching entries in ledgers with inky fingers. But best of all, for Hugh, had been the basement, where contracts even older than grandfather were kept in vaults, thousands of postage stamps waited to be licked, and there was a whole room full of ink stored in enormous glass jars. It had amazed him to reflect on the process. The ink came into the bank, it was spread over the papers by the clerks, and then the papers were returned to the basement to be stored forever; and somehow this made money.
The mystery had gone out of it now. He knew that the massive leather-bound ledgers were not arcane texts but simple lists of financial transactions, laboriously compiled and scrupulously updated; and his own fingers had become cramped and ink-stained by days of writing in them. A bill of exchange was no longer a magic spell but merely a promise to pay money at a future date, written on a piece of paper and guaranteed by a bank. Discounting, which as a child he had thought must mean counting backwards from a hundred down to one, turned out to be the practice of buying bills of exchange at a little less than their face value, keeping them until their due date, then cashing them at a small profit.
Hugh was a general assistant to Jonas Mulberry, the Principal Clerk. A bald man of about forty, Mulberry was good-hearted but a little sour. He would always take time to explain things to Hugh, but he was very quick to find fault if Hugh was in the least hasty or careless. Hugh had been working under him for the past year, and yesterday he had made a serious mistake. He had lost a bill of lading for a consignment of Bradford cloth destined for New York. The Bradford manufacturer had been downstairs in the banking hall asking for his money, but Mulberry had needed to check the bill before authorizing payment, and Hugh could not find the document. They had been obliged to ask the man to come back in the morning.
In the end Hugh had found the bill, but he had spent most of the night worrying about it, and this morning he had devised a new system of dealing with papers for Mulberry.
On the table in front of him he had two cheap wooden trays, two oblong cards, a quill pen and an inkwell. He wrote slowly and neatly on one card:
For the attention of the Principal Clerk
On the second card he wrote:
Having been dealt with by the Principal Clerk
He carefully blotted his writing then fixed one card to each tray with tacks. He put the trays on Jonas Mulberry’s table and stood back to survey his work. At that moment Mr. Mulberry came in. “Good morning, Mr. Hugh,” he said. All family members were addressed this way at the bank because otherwise there would be confusion among all the different Mr. Pilasters.
“Good morning, Mr. Mulberry.”
“And what the dickens is this?” Mulberry said tetchily, looking at the trays.
“Well,” Hugh began. “I found that bill of lading.”
“Where was it?”
“Mixed up with some letters you had signed.”
Mulberry narrowed his eyes. “Are you trying to say it was my fault?”
“No,” Hugh said quickly. “It’s my responsibility to keep your papers in order. That’s why I’ve instituted the tray system—to separate papers you’ve already dealt with from papers you haven’t yet looked at.”
Mulberry grunted noncommittally. He hung his bowler hat on the hook behind the door and sat down at the table. Finally he said: “We’ll try it—it might be quite effective. But next time, have the courtesy to consult me before implementing your ingenious ideas. This is my room, after all, and I am the Principal Clerk.”
“Certainly,” Hugh said. “I’m sorry.” He knew he should have asked Mulberry’s permission, but he had been so keen on his new idea that he had not had the patience to wait.
“The Russian loan issue closed yesterday,” Mulberry went on. “I want you to go down to the post room and organize the counting of the applications.”
“Right.” The bank was raising a loan of two million pounds for the government of Russia. It had issued 100-pound bonds which paid five pounds interest per year; but they were selling the bonds for 93 pounds, so the true interest rate was over five and three-eighths. Most of the bonds had been bought by other banks in London and Paris, but some had been offered to the general public, and now the applications would have to be counted.
“Let’s hope we have more applications than we can fulfill,” Mulberry said.
“Why?”
“That way the unlucky applicants will try to buy the bonds tomorrow on the open market, and that will drive the price up perhaps to 95 pounds—and all our customers will feel they’ve bought a bargain.”
Hugh nodded. “And what if we have too few applications?”
“Then the bank, as underwriter, has to buy the surplus—at 93 pounds. And tomorrow the price may go down to 92 or 91 pounds, and we will have made a loss.”