Holy Roman Empire

In the reception room of the UK Foreign Office, the atmosphere was particularly eerie. One side of the negotiations was extremely tense but had to feign smiles; the other side clearly had no interest yet pretended to listen attentively.

This peculiar scene was exactly that of the negotiations between the UK and Prussia. From the very beginning, the two sides were on unequal footing,

much like a person with no money in their pocket and hunger in their belly who needs to borrow money to eat. To get a loan, one would...

UK Foreign Minister Edward waved his hand, "I’m sorry, Count. There’s nothing I can do. Loans are the business of the banks, and you should talk to the bankers."

Merely relying on attitude is clearly not enough to borrow money. Without sufficient benefits, why would John Bull possibly open his wallet?

Prusso Federation Foreign Minister Friedman said, "Sir, we’ve already communicated with the banks. We need your country’s government to provide an endorsement. Please rest assured, we are very, very sincere this time.

Interest could be raised by 30% above the international average rate, and we can provide financial income, colonies, railways, mines, and ports as collateral."

While international loans could be very profitable, they also carry great risks. Without government "endorsement," anyone making international loans is a fool.

With government "endorsement," if debt default occurs, the government will step in to collect. Although it’s not guaranteed to recover the money, it does increase the cost of default for the other party.

If there were no government "endorsement," then you would be left to chase the debt yourself! There are plenty of examples, such as the previous default of the Tsarist Government.

Debts backed by government "endorsements" were settled through negotiation, allowing for the recovery of at least a portion. Debts without government "endorsement" were simply written off.

This time, with the outcome of the Prusso-Russian war unpredictable and the continued existence of the Prusso Federation uncertain, without the London Government’s endorsement, bankers naturally dare not take on this business, no matter how high the interest is.

In this day and age, governmental regulations on financial markets were almost non-existent. Yet, without government support, raising hundreds of millions of pounds from the financial market was an impossibility.

UK Foreign Minister Edward shook his head, "Count, I feel your sincerity, but it is of no use.

We are all well aware of the destructiveness of war. The Prusso-Russian war is imminent, and only if your country emerges victorious is there a chance of fulfilling the debts.

But this is just a possibility. The Russian Empire is not so easy to deal with. Even if your country defeats them once more, the cost will be significant. After the war, what will your country use to repay these debts?

War reparations?

Forgive me for speaking bluntly, but if the Tsarist Government had money, the war would not have ended.

Your country might acquire valuable assets like land, population, factories, but these things, although precious, cannot be immediately converted into cash.

Furthermore, due to the war, your country will need to invest heavily in reconstruction. Financially, this will be a burden for a long time to come.

And this is the best-case scenario. If the war becomes protracted and evolves into a long-term confrontation, the situation will be even worse.

If one day your country indeed cannot fulfill the obligations, are we to live off these collaterals?

Count, you must understand that to bankers, the collaterals offered by your country have no substantial effect."

Edward’s words were already quite restrained, not even touching upon the possibility of a Prusso Federation defeat, yet it was something that had to be realistically considered.

Even if the war is won, the normal fulfillment of debts can’t be guaranteed; if lost, let alone.

Friedman still had confidence in this war. However, his confidence did not mean the British shared it.

Whether we acknowledge it or not, the comprehensive national power of Russia surpasses that of the Prusso Federation.

Their victory in the last war occurred because every country in Europe wanted the Russians to lose, and the actual strength the Tsarist Government devoted to the fight was, at most, half.

Times have changed. The weakened Russian Empire is not as feared by others. To get countries to contribute money and support, interests would need to speak.

After hesitating for a moment, Friedman asked directly: "Sir, what does your country wish to gain?"

The Prussian Federation was not in a position to dictate terms; rather than wasting time negotiating, it was better to put cards on the table. After all, if the British were willing to pay, everything was negotiable.

UK Foreign Minister Edward gestured, "Count, you misunderstand. We don’t wish to gain anything. You must believe that the friendship between our two countries will withstand the test. It’s just that the bankers need assurance.

If your country could deposit reserve gold in the Bank of England as a guarantee, everyone would be much more confident in you. Your country could at least secure a loan of 60 million pounds."

Friedman’s face turned ugly in an instant. A loan of 60 million pounds sounded tempting, but in fact, the Prusso Federation currently had 478.6 tons of gold reserves for issuing currency.

Of course, due to international settlements, the Prusso Federation would still need to retain a portion of gold. The gold that could be deposited into the Bank of England was valued at around 60 million pounds.

This was not just a matter of gold, but also involved currency issuance. Once the gold fell into British hands, it would be difficult to take it back.

With the reserve gold in British hands, future currency issuance by the Prusso Federation would inevitably be under the influence of the London Government. Similar to the Federal Reserve in later times, they could influence the world economy through monetary policy.

There was nothing surprising about this, as the Americans had learned from the British. It was simply that America’s national strength was stronger, and its hegemony was much more stable than that of Britain.

Due to Franz’s butterfly effect, the Divine Shield emerged forcefully, and the British pound could not enjoy a monopoly on currency hegemony. Under this context, it was not surprising that the British were eyeing the Prusso Federation.

For the Berlin Government, depositing gold into the Bank of England meant not only a loss of monetary sovereignty but also a political stance.

Choosing to support the British would naturally offend France and Austria. No, it should be said that it would offend Austria.

Because of insufficient gold reserves, in this round of currency hegemony, the Franc had already been the first to exit the competition.

Without much hesitation, Friedman gave his answer, "A loan of 60 million pounds is too little. The value of the gold we hold is no less than this amount, not to mention the additional political and economic value.

Once the gold is deposited into the Bank of England, we will inevitably offend the Austrians. In the upcoming Prusso-Russian War, Austria’s voice will be the most important.

Not long ago, the Vienna Government also made a similar request; their terms were much more generous."

Whether the Vienna Government had made a request or not, as competitors, the British had no way to verify it. Even if there wasn’t one, the Berlin Government would willingly offer it, and the Vienna Government would not refuse.

Edward smiled faintly. He wasn’t surprised that Friedman used Austria as a pretext to raise the price; such occurrences were common in diplomacy.

However, the fact that Wilhelm I’s first state visit was to be in London, signified that the Berlin Government was more inclined to cooperate with them.

He said tentatively, "Count, this issue can be discussed gradually. We wouldn’t let our friends suffer a loss.

As for the Vienna Government’s higher bid, they also need to be able to fulfill their promises. Though the Russian-Austrian Alliance has ended, the relationship between Russia and Austria has not broken down.

In the last thirty years, the economies of Russia and Austria have become intertwined. Even if the Vienna Government were willing to abandon the Tsarist Government, it wouldn’t be something that could be done in a short time.

No matter what choice your country makes, Austria won’t be able to sever ties with the Russians for your sake - interests dictate this."

Friedman nodded, acknowledging this undeniable fact. Economically, Russia and Austria indeed stood together. The Russian-Austrian Alliance would not have dissolved if both countries did not harbor ambitions for hegemony.

The Berlin Government would rather cooperate with the more disreputable British, rather than seeking help from Austria, because of an inherent wariness of the Russia-Austrian relationship.

After a pause, Edward continued, "If your country wishes to win this war, it will need more supporters. As friends, we would be happy to provide assistance to your country."

Edward spoke with confidence, for despite Britain’s poor reputation in Europe, its influence in foreign diplomacy remained immense.

It was unnecessary to mention the small countries; what was crucial was the influence on France. Ever since the restoration of Napoleon III, the Paris Government had been filled with a large number of Pro-British Faction members.

If the British Government was willing to intervene with these people, it would greatly reduce the difficulty for the Prusso Federation to seek French support.

Friedman was tempted - not out of shallowness, but because the Prusso Federation had too few chips in hand.

The so-called colonies consisted only of a small part of the Indochina Peninsula, barely managed by the Berlin Government and essentially worthless.

The so-called "fiscal revenue" was even more of a joke. In the past decade or more, apart from the year when they sold land, when had there ever been a surplus?

If these assets were put up as collateral, they still had to maintain government operations. Otherwise, would the bankers go collect taxes themselves?

Railroads, mines, ports—these were mostly just for show. Most of these industries were private, and only a very few belonged to the Berlin Government.

Private property is sacred and inviolable; naturally, the government had no right to dispose of it. What the Berlin Government could mortgage were only the assets that belonged to the government.

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