The Great Company Part 21

[48] THE COMPANY'S PEt.i.tION TO QUEEN ANNE FOR ACT OF CESSION.

_To the Queen's Most Excellent Majesty_:--

The humble pet.i.tion of the Governor and Company of Adventurers of England trading into Hudson's Bay, sheweth:

That your pet.i.tioners, being informed that the Act of Cession is come over, whereby (among other matters thereby concerted) the French King obliges himself to restore to your Majesty (or to whom your Majesty shall appoint to take possession thereof) the Bay and Streights of Hudson, as also all forts and edifices whatsoever, entire and demolished, together with guns, shot, powder and other warlike provisions (as mentioned in the 10th article of the present treaty of peace), within six months after the ratification thereof, or sooner, if possible it may be done.

Your pet.i.tioners do most humbly pray your Majesty will be graciously pleased to direct the said Act of Cession may be transmitted to your pet.i.tioners, as also your Majesty's commission to Captain James Knight and Mr. Henry Kelsey, gentleman, to authorize them, or either of them, to take possession of the premises above mentioned, and to const.i.tute Captain James Knight to be Governor of the fortress called Fort Nelson, and all other forts and edifices, lands, seas, rivers and places aforesaid; and the better to enable your pet.i.tioners to recover the same, they humbly pray your Majesty to give orders that they may have a small man-of-war to depart with their ships, by the 12th of June next ensuing, which ship may in all probability return in the month of October.

And your pet.i.tioners, as in duty bound, shall ever pray.

By order of the Company.

per WM. POTTER, SECRETARY.

[49] "MY LORDS AND GENTLEMEN,--The Queen has commanded me to transmit to you the enclosed pet.i.tion of the Hudson's Bay Company, that you may consider of it and report your opinion what orders may properly be given upon the several particulars mentioned. In the meantime I am to acquaint you that the places and countries therein named, belonging of right to British subjects, Her Majesty did not think fit to receive any Act of Cession from the French King, and has therefore insisted only upon an order from that Court for delivering possession to such persons as should be authorized by Her Majesty to take it; by this means the t.i.tle of the Company is acknowledged, and they will come into the immediate enjoyment of their property without further trouble."

[50] In 1714 the Hudson's Bay Company sent a memorandum to the Lords Commissioners of Trade and Plantations, accompanied by a map in which they claimed that the eastern boundary should be a line running from Grimington's Island through Lake Miscosinke or Mista.s.sinnie, and from the said lake by a line run south-westward into 49 degrees north lat.i.tude, as by the red line may more particularly appear, and that that lat.i.tude be the limit; that the French do not come to the north of it, nor the English to the south of it.

[51] MR. BLADEN TO MR. DELEFAYE.

PARIS, November 11th, 1719, N.S.

On Wednesday last, my Lord Stair and I delivered to the Marechal d'Estrees the demand of the Hudson's Bay Company, with respect to their limits, and by comparing the enclosed, which is a copy of that demand, with the instruction upon his head, you will perceive the same has been fully complied with.

So soon as I shall have the French Commissary's answer to our demand, I shall likewise take care to transmit you a copy of it, to be laid before their Excellencys the Lord Justices.

[52] PARIS, May the 4th, N.S., 1720.

MR. PULTENEY TO MR. SECRETARY CRAGGS.

My Lord Stair has spoke to the Regent, who said immediately that the conferences shall be renewed whenever we please; His Excellency then desired His Royal Highness would appoint a day, which he promised to do. This is what the Regent has promised my Lord Stair once every week, for four or five months past, without any effect, and his Excellency does not expect any more from the promise now, though possibly a conference may be appointed for form sake. I have been here near six months, and have seen only one conference, which was appointed by my Lord Stanhope's desire. I think there had been two conferences before I came; at the first of them the commissions were read, and at the second my Lord Stair and Mr. Bladen gave in a memorial about the limits of the Hudson's Bay Company, to which no answer has been made. I must own that I never could expect much success from this commission, since the French interests and ours are so directly opposite, and our respective pretensions interfere so much with each on the several points we were to treat about; but that the French have not been willing to entertain us now and then with a conference, and try how far we might be disposed to comply with a conference, and try how far we might be disposed with any of the views they had in desiring the commission, cannot, I should think be accounted for, but by supposing they knew we came prepared to reject all their demands, and to make very considerable ones for ourselves.... I shall expect your further direction as to my stay or return; I cannot help owning I heartily wish for the latter, but I shall always submit to what His Majesty likes best, and shall only desire in this case that I may have a supply from the treasury, since I have not had the good fortune to be concerned in either of the Misiseppis.

CHAPTER XVIII.

1719-1727.

The South Sea Bubble -- Nation Catches the Fever of Speculation -- Strong Temptation for the Company -- p.r.i.c.king of the Bubble -- Narrow Escape of the Adventurers -- Knight and his Expedition -- Anxiety as to their Fate -- Certainty of their Loss -- Burnet's Scheme to Cripple the French -- It Forces them Westward into Rupert's Land.

The cause of the Governor's recall lay in the existence of a crisis which promised a happy issue. It arose through the venality of some of the Company's directors, who were victims of the South Sea fever.

[Sidenote: South Sea Company.]

The South Sea Company, whose extraordinary success gave rise to a thousand joint stock enterprises equally unsound and fatuous, owed its origin to Harley, Earl of Oxford, in 1711, who in return for the acceptance of a government debt of 10,000,000 granted to a number of merchants a monopoly of the trade to the South Seas.

At that time the most extravagant ideas prevailed concerning the riches of South America. "If," it was said, "the Hudson's Bay Company can make vast moneys out of the frozen North, what can be done with lands flowing with milk and honey?" The South Sea Adventurers carefully fostered all the current notions, spreading likewise the belief that Spain was ready to admit them to a share of its South American commerce.

In 1717 this Company advanced to the English Government five more millions sterling, at an interest of six per cent. Their shares rose daily. Even the outbreak of war with Spain, which destroyed all hope in the minds of sensible persons of any share in the Spanish traffic, did not lessen the Company's popularity. In Paris, John Law's Mississippi Bubble burst, ruining thousands, but, far from being alarmed at this catastrophe, it was universally believed that Law's scheme was sound, but had been wrecked through unwise methods. In May, 1720, the South Sea Company proposed to take upon themselves the entire national debt of upwards of 30,000,000 upon a guarantee of five per cent. per annum for seven and one-half years, at the end of which period the debt might be redeemed if the Government chose, or the interest reduced to four per cent. The nation was dazzled; Parliament accepted the offer; and the Company's stock rose steadily to 330 on April 7, falling to 290 on the following day.

[Sidenote: A fever of speculation.]

This day in April witnessed a change in methods on the part of the South Sea directors. Until then the scheme had been honestly promoted; but the prospect of enormous wealth was too near to be permitted to escape. It became thenceforward, until the crash, the prime object of the directors, at no matter what cost or scruple, to maintain the fict.i.tious value of the shares. By May 28, 100 shares were quoted at 550; three days later they had reached 890. The whole nation caught the fever; the steadiest merchants turned gamblers. Hardly a day pa.s.sed without a new swindling concern being started as a joint stock company.

Meanwhile several of the Hudson's Bay Merchants-Adventurers looked on with envious eyes. The desire was great to embark in so tempting a scheme, and the opportunity to cast inflated shares on the market almost too great to withstand.

But for many weeks the temptation was resisted. At last, at a meeting early in August, the chief director came before a general court of the Adventurers with a scheme by which each partner could either retire with a moderate fortune or remain an active partic.i.p.ant, and reap the benefit of an infusion of public capital.

The scheme was simplicity itself, to modern notions; but that it was not so regarded by some of the Adventurers themselves may be gathered from the following pa.s.sage from a letter of Mrs. Mary b.u.t.terfield, one of the owners of the Company's stock.

"I cannot tell you how it is to be done, for that pa.s.ses my wit; but in short, the value of our interests is to be trebled without our paying a farthing; and then to be trebled again if the business is to the publick taste, and we are told it cannot fail to be."

[Sidenote: Plan to reorganize the Company.]

It was late in August before the scheme was detailed. It was explained that the Company's a.s.sets in quick and dead stock and lands were 94,500. With this as a basis, it was proposed to enlarge the stock to the sum of 378,000, dividing this into 3,780 shares of 100 each.

Before this could be carried out, however, the existing stock, being but 31,500, or 315 shares, was to be made and reckoned 945 shares of 100 value each. By such means a result of 94,500 actual capital would appear. A majority of partners favoured the scheme, and the proposal was carried amidst the greatest enthusiasm. Its purpose was to unload the stock at an inflated figure, far even in excess of that actually named by its promoters. Had it succeeded and the flotation been carried out, it would have doubtless administered a death-blow to the Company as then organized, and would probably have involved the revocation of its charter in view of what was soon to occur. But the plan met with a sudden arrest by an event which then happened, and which in beggaring mult.i.tudes altered the whole disposition of the public with regard to joint stock enterprises.

A general impression had gained ground that the South Sea Company's stock had attained high-water mark, and so many holders rushed to realize that the price fell, on June 3rd, to 640. The directors were not yet ready for their _coup_. Agents were despatched by them to buy up and support the market, and the result was that by nightfall of that day the quoted price was 750. By means of this and similarly unscrupulous devices, the shares were sent, early in August, to 1,000.

This was the long-awaited opportunity. Many of the directors sold out; a general anxiety began to prevail and the shares began to drop. In view of this change in affairs, the Hudson's Bay Company's meeting for September 3rd was deferred. On the 12th, South Sea shares were selling at 400, and the decline continued. The country was thrown into the greatest excitement, and by the time December had arrived, Parliament had been hastily summoned to consider the calamity.

With what happened subsequently, to the authors and partic.i.p.ators in this celebrated joint stock swindle, it is not my present purpose to deal, except to say that the Hudson's Bay Company was saved in the nick of time from sharing the fate of its neighbour and rival. A meeting on the 23rd of December was held, at which it was resolved that the "said subscription be vacated; and that the Company's seal be taken off from the said instrument."

Nevertheless one permanent result remained. The capital had been trebled, and it was now further resolved that each subscriber should have 30 of stock "for each 10 by him paid in." This trebled, the total capital stood, at the beginning of 1721, at 94,500.

The Company had had a narrow escape. To what extent its shares would have been inflated may be conjectured; but it is certain that it could not have avoided being swept into the vortex and sharing the same fate which overtook so many of its commercial contemporaries. Its enemies were on the watch, and they would have proved relentless. The revocation of its charter would have accomplished its final downfall.

Already the Company was being a.s.sailed because it had not complied with one of the provisions named in that instrument: that of making search for a north-west pa.s.sage.

It was not, however, to quiet these reproaches, so persistently levelled at it, that a year before the bursting of the South Sea Bubble an expedition was actually set on foot to accomplish the long-deferred exploration.

Knight, the Company's aged Governor at York Factory, had long listened to the tales of the Indians concerning the copper mines to the north; and resolved, on his return to England, to bring the matter before the Company. This he did, but it was by no means an easy matter to induce the Adventurers to consent to the expense of further exploration.

Nevertheless Knight's insistence prevailed, more especially as, besides the profitable results to be obtained through such a voyage, he was careful to point out that the Company were expected by their charter to undertake such an expedition.

[Sidenote: Expedition to explore the north-west pa.s.sage.]

In 1719 the Company, therefore, fitted out two ships for the purpose of discovery north of Churchill. One of these, called the _Albany_, a frigate, was commanded by George Barlow, whom we have already seen as Deputy-Governor at Albany in 1704, when the French failed to capture that post. The other, named the _Discovery_, a sloop, under David Vaughan. But the command of the expedition itself was entrusted to Knight, who was a man of great experience in the Company's service, who had been for many years Governor of different Factories in the Bay, and who had made the first settlement at Churchill River.

Nevertheless, in spite of the experience Knight possessed of the Company's business, and its methods of trade with the Indians, there was nothing to lead any one to suppose him especially adapted for the present enterprise, having nothing to direct him but the slender and imperfect accounts which he, in common with many other of the Company's servants had received from the Indians, who, as we have seen, were at that time little known and less understood.

But these disadvantages, added to his advanced years, he being then nearly eighty, by no means deterred his bold spirit. Indeed, so confident was he of success and of the material advantages which would accrue from his impending discoveries, that he caused to be made, and carried with him, several large iron-bound chests, wherein to bestow the gold dust and other treasures which he "fondly flattered himself were to be found in those parts."

The first paragraph of the Company's instructions to Knight on this occasion was as follows:--

4th June, 1719.

TO CAPTAIN JAMES KNIGHT.

SIR,--From the experience we have had of your abilities in the management of our affairs, we have, upon your application to us, fitted out the _Albany_ frigate, Captain George Barlow, and the _Discovery_, Captain David Vaughan, Commander, upon a discovery to the northward; and to that end have given you power and authority to act and do all things relating to the said voyage, navigation of the said ship and sloop only excepted; and have given orders and instructions to our said Commanders for that purpose. You are, with the first opportunity of wind and weather, to depart from Gravesend on your intended voyage, and by G.o.d's permission to find out the Straits of Anian, and to discover gold and other valuable commodities to the northward.