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The French bonds: the little-known bidding war for France's holdings in American debt, 1786–1790

Published online by Cambridge University Press:  15 July 2021

Peter Theodore Veru
Peter Theodore Veru*
Affiliation:
University of Colorado
*
Dr Peter Theodore Veru, independent scholar, University of Colorado, 883 Grant Place, Boulder, CO80302, USA, email: [email protected].
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Abstract

In 1786, the Van Staphorst brothers, America's Dutch investment bank, entered the French office of the Director General of Finance, intent on making an offer for a portion of France's holdings of American bonds. Unknowingly, their offer set off a bidding war that could have ended with poorly capitalized American financial adventurers owing a large portion of bonds which could threaten the fragile health of American credit. At the eleventh hour, the Van Staphorsts conjured up a bold, unprecedented, scheme to persuade the French that it would be unnecessary to sell their American bonds at discounted prices.

Keywords

United StatesDutchfinanceConfederation Eracapital markets

JEL classification

N43: Europe: Pre-1913 N42: U.S. • Canada: 1913–
Type
Articles
Information
Financial History Review , Volume 28 , Issue 2 , August 2021 , pp. 259 - 280
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Copyright
Copyright © The Author(s), 2021. Published by Cambridge University Press on behalf of the European Association for Banking and Financial History

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Footnotes

The author would like to acknowledge the two referees and the editor of the Financial History Review for their helpful comments and patience. The author would also like to thank Dr Fred Anderson for his continued advice and friendship.

References

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