Holy Roman Empire

In Paris, within the walls of an exclusive luxury club closed to the public, several titans of France’s financial world gathered for a meeting.

A kindly-looking elderly man chuckled and asked, “I hear young Nino has run into some trouble. How is he doing? Has he completed the task?”

To outsiders, his amiable demeanor would be deceiving, as few knew that this seemingly gentle old man was the most notorious “bloodsucker” of the French financial world.

What’s most frightening is that he maintains a smiling expression in any situation, including when killing people.

“Enough of your act, old Duc,” scoffed Dumas, clearly unimpressed, “We’ve known each other for years. Who doesn’t know what you’re really like? Day after day with this performance, aren’t you tired of it? Because we sure are.”

Despite their frequent clashes over competing interests, the two still managed to work together when it came to making money. Now, for the Panama Canal project, they once again sat at the same table.

To prevent further escalation of tensions, the host of the meeting, Belles, decisively steered the discussion back on track, saying, “Gentlemen, let’s prioritize the business at hand. Let’s talk about the canal project.

We’re all familiar with the Suez Canal. What was once considered a doomed investment managed to recoup all its costs within just seven years of operation.

Today, it provides investors with substantial annual returns, and its profits continue to grow alongside the expansion of overseas trade. If things go as expected, this revenue stream could last for over a century.

Of course, the Suez Canal is an exception. The unique geography of the Mediterranean isn’t something you can replicate just anywhere. Achieving the same success as the Suez Canal is almost impossible.

The Panama Canal, however, is perhaps the closest candidate. Once operational, it would drastically shorten the distance between the Pacific and Atlantic Oceans, and the potential profits can be imagined.”

Old Duc shook his head, “It’s not that simple. The Panama Canal is not the same as the Suez Canal. Politically, we don’t have the support we need. The Austrians don’t want to see the canal open, the British are against it, and even the French government may not support the Panama Canal’s opening.

The reasons for this are clear. The Suez Canal primarily benefited Mediterranean countries, with France and Austria among the biggest beneficiaries. For strategic reasons, the two nations pushed the project forward despite British opposition.

The Panama Canal, on the other hand? The biggest beneficiary would be the United States, followed by the Republic of Colombia. Other countries in the Americas would also gain to varying degrees.

But for us, and for Britain and Austria, the gains are minimal. Outside of the canal itself, France stands to gain very little.

Austrian Central America, for instance, is a small region where railways can meet most transport needs. Without a pressing demand for a canal, they could have built one themselves in Nicaragua.

British Canada is a similar case where there are vast lands but sparsely populated, with insufficient goods requiring transport. From the perspective of politicians, a project that primarily benefits others is better left untouched.

As for the canal’s profits, I’m sorry, but I don’t believe the Panama Canal could ever match the Suez Canal’s performance.

Looking at the current economic situation in the Americas, the number of ships passing through the canal each year might not even equal the number of vessels we send through the Suez Canal alone.

If the economies of the Americas grow significantly in the future, perhaps it could become profitable. But under current circumstances, the likelihood of this project incurring losses is almost guaranteed.”

Indeed, there were hidden interests behind the Panama Canal, but these were not benefits governments could directly reap.

Compared to the enormous investment required, merely collecting toll fees made the construction of the Panama Canal a massive financial loss in this era. Otherwise, in the original timeline, it wouldn’t have been delayed until just before World War I to open.

Without government involvement and facing potential interference from other nations, the Panama Canal being successfully completed and operational would be nothing short of a miracle.

Belles smiled faintly, “Whether the Panama Canal is profitable or even operational, what does that have to do with us?

All we need is for the world to believe that this project has tremendous potential just like the Suez Canal now. The perception that it can make a fortune is all that matters.

Based on my initial calculations, if we proceed with this project, we could mobilize 10 to 20 billion francs in capital. Including the surrounding industries and benefits, this number could be even higher.

We just need to carve out a piece of that pie. Whether the canal succeeds or fails is a matter for God to decide.”

The others began calculating their potential profits. Undoubtedly, this was a colossal scam, but this kind of strategy was a fundamental tactic in the world of capital. Without crafting a grand dream, how could investors be lured in? ℟à₦ŏʙƐṡ

For financial capital, the success or failure of a project is irrelevant. As long as it can be launched and listed, they can secure hefty returns. Long-term management has never been their concern.

Old Duc nodded in agreement, “You’re right. We’re not God, how could we possibly know whether the Panama Canal project will succeed? I think we should focus on quickly securing the canal development rights and then preparing to list it.

If possible, it would be best to bring British and Austrian capital into the fold. By making the pie larger, we can claim the most delicious slice for ourselves. Especially with Austria, someone must lobby the Austrian government to at least delay their interference.”

Belles continued, “That’s precisely why I’ve gathered everyone here. A project of this scale involves far too many relationships to coordinate, and only through united efforts can we make it work.”

Clearly, the situation was more complex than it appeared. A single Panama Canal project alone wouldn’t be enough to bring together so many titans of French finance.

Once the hype is successfully built, the scope of the endeavor will expand beyond the canal. It will involve maritime transportation, manufacturing, banking, and more.

By the time this project gets rolling, it could trigger a new bull market. And when the project inevitably collapses, it will likely herald the onset of a stock market crash.

…

Smart minds are never in short supply. Far away in New York, Morgan, with his keen financial acumen, quickly sensed that something was off.

The Panama Canal didn’t actually require the involvement of the United States. Even if they were involved, their only role would be to provide funding, they wouldn’t have much else to contribute.

Internally, the United States was riddled with conflicts, and the federal government was too weak to mobilize the country’s full strength. Moreover, with the Confederate States eyeing them closely, they wouldn’t dare to act recklessly.

If it really came to a confrontation with Austria, the federal government could do little beyond issuing protests. Without government involvement, what could the financial consortia even do? Organize mercenaries to defend the Panama region?

Morgan wasn’t underestimating his own capabilities as financial consortia were indeed powerful but it depended on the context. If it came to hiring mercenaries to face off against a major power, they would likely meet a miserable end.

It wasn’t just the United States, Spain wouldn’t fare much better either. While Spain appeared to have significant influence in the Caribbean, its colonies in the region had long been eyed by the Confederate States.

The lack of action was due in part to fear of the combined strength of Britain, France, and Austria, and concerns about becoming a target of European powers. On the other hand, the Confederate States and the United States were mutually restraining each other, and any hasty action could present an opening to their enemies.

Even if the profits from the Panama Canal were immense, Spain wouldn’t risk provoking Austria now and bringing trouble upon itself.

Let’s not forget, Spain’s territory in Southeast Asia, the Philippines, was practically under Austria’s nose. Spain’s ability to hold onto this land depended on diplomatic relations, not military might.

Given that both partners were unreliable, France’s insistence on involving them made the situation clear.

Uncovering the truth only strengthened Morgan’s resolve to cooperate with France. If there was free money on the table, why not take it? As for who would outsmart whom in the end, that would depend on each party’s skills.

After all, the Morgan consortium had risen to its current stature by exploiting the British. If they could outwit the British, dealing with the French wouldn’t pose much of a challenge.

…

In the Vienna Palace, Franz hesitated as he looked at the intelligence report in his hand. He wasn’t sure whether to cooperate with these financial consortia.

Purely from a profit standpoint, there didn’t seem to be a reason to refuse. The benefits promised by the French were quite substantial.

But going along with it would cross a line for him. While the Imperial Consortium did engage in financial activities, it had never participated in an outright massive scam before.

After much deliberation, Franz made his decision, “Tell them they can cooperate with the French, but the Panama Canal project cannot be listed on the Austrian stock market. If they proceed to that step, they’ll have to handle it themselves.”

If someone offered money, why not take it? As long as the Panama Canal Company wasn’t listed in Austria, any repercussions would be manageable.

If investors still went out of their way to buy shares, they’d only have themselves to blame if they got fleeced.

The Austrian Securities Commission was known for its strict standards. For a company with no tangible assets or revenue, it would be impossible to get listed unless it had government backing.

Franz didn’t believe the Austrian government would vouch for the Panama Canal. High-ranking officials were well aware that unless Austria completely changed its policies, this project had no chance of success.

The French attempt to involve Austrian consortia was mainly about ensuring the Austrian government didn’t sabotage the project and getting listed in Austria wasn’t even on their radar.

The reason was simple. Under Austria’s updated securities laws, companies seeking to go public had strict performance requirements. Unless it was a government-approved project, companies had to demonstrate three consecutive years of profits exceeding 100,000 guilders.

No matter how the Panama Canal project was spun, there was no way the capitalists could produce a three-year profit record before the canal was operational.

Of course, the promised benefits wouldn’t come without strings attached. There would undoubtedly be additional conditions and nobody was going to get free money. The specifics would need to be ironed out in negotiations, but that wasn’t something Franz was concerned about.

In the end, rewards were proportional to contributions. Since the French were masterminding the plan, they would naturally take the largest share. Other participants would divide the spoils based on their involvement.

This was merely the preliminary profit-sharing framework. The actual earnings each party secured would ultimately depend on their skills and tactics. Capitalism is stained in blood, and competition is everywhere.

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