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Finally the whole issue was taken by Baron Erlanger, a wealthy German with banking houses at Frankfort, Paris, and Amsterdam. (After the war Erlanger built a number of railroads in the South which he styled the ‘Erlanger system.’) Baron Erlanger ridiculed the idea of the South, issuing $15,000,000 in bonds, when a much larger figure could have been negotiated. For it is a fact that at that time cotton was bringing from 60 to 80 cents a pound in Liverpool, and these bonds provided for the redemption of the money with cotton at 10 cents a pound. Colonel Gibbes is not positive what Erlanger gave for the bonds, but thinks the price was over 80 cents on the dollar.

This was a speculation for the wealthy foreigner, and he advertised for proposals for the bonds. He put the minimum price to be bid at 90 cents. The actual bids were even higher. Mirabile dictu! There were but fifteen millions of dollars represented by the bonds, yet the bids aggregated $625,000,000. It is evident that more than $15,000,000 could have been gotten.

Erlanger came to this country and from President Lincoln at Washington obtained a pass to Richmond — for Lincoln did not know Erlanger or suspect his mission. The foreigners communicated with President Davis and Mr. Memminger and urged them to make a larger issue of cotton bonds. He was received indifferently by Mr. Davis, who had learned to rely on Mr. Memminger's excellent judgment. The latter declared that the Confederate Congress authorized him to borrow but $15,000,000 and he could not exceed its instructions.

Erlanger was thus unseccessful. He declared that the South should get all the foreign money possible. ‘Get them interested financially in your success or failure, and they will force their government to recognize the Confederacy as a government, and its subjects as belligerents.’ This would have meant peace, for the South starved to death because of the fact that foreign powers would not recognize her government.

In Capers' life of Memminger, the distinguished Secretary of the Confederate Treasury is excused for not taking advantage of this opportunity on the ground that he could not exceed his instructions. But Colonel Gibbes says the Confederate Congress was almost constantly in session and it would not have been a difficult matter to have gotten authority.

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