The Viennese Waltz(125)

Two more beers and his father was still not convinced, but did agree to look over the proposal.

The Hofburg Palace, Vienna

The beer at the Hofburg was cold, with beads of sweat on the stein as Ferdinand read the latest reports. “I would not have believed that Gustav could move so quickly.”

“I wouldn’t have believed that he would have divided his forces like that,” said Maximilian von Liechtenstein. “It worked out this time, in spite of his General Stearns being an idiot, but talk about arrogant!”

Maximilian was referring to the recent battle of Zwenkau, where the USE army under Torstensson’s command had defeated Von Arnim’s Saxon forces. The turning point in the battle had come when the inexperienced American general Michael Stearns foolishly advanced his division too far ahead of the rest of the USE forces. In the event, it had all turned out well for him, but it was the general assumption among Austrian analysts of the battle that Stearns had triumphed despite his blunder.

“Some people are saying that was a trap set by Torstennson,” Leopold said. “That it was all planned that way.”

“That’s what I’d say too, if I had a political general who bungled that badly,” Maximilian said. “I guess it’s possible. But I certainly wouldn’t trust a virgin general with an assignment of that nature.”

“You think we should support King Wladislaw, if—when, I should say—the Swede attacks Poland?” Ferdinand asked.

“No, Your Majesty,” said Maximilian immediately. “Gustav Adolf may be arrogant, but he’s also good and he has a very good army, in spite of Stearns. Besides, I don’t recall any favors we owe Wladislaw at this point.”

“We’re probably going to need the Poles if Murad comes,” offered Archduke Leopold. “Which he might well do, considering that he is apparently going after Baghdad this year, instead of waiting for the appointed time from the encyclopedia. If he rushes Baghdad, why not have the 1683 attack on Vienna early as well? And we needed the Poles in that history to fight him off.”

Ferdinand had considered the same factor himself—many times, now. But the advice he’d gotten from Janos Drugeth still seemed sound. Sending Austrian troops to aid King Wladislaw simply couldn’t be done without risking a renewal of the war with Wallenstein—whose Bohemian forces stood between Austria and Poland. Poland would probably still be defeated by the USE and all Ferdinand would have accomplished was to bloody his own forces to no purpose.

“No,” he said. “We have no choice but to wait for developments.”





CHAPTER 31

Fractured Reserve Bank

October 1635

Liechtenstein House, Vienna

“Theoretically it’s a full reserve bank,” Sarah explained, “but in fact it operates as a fractional reserve bank.” She was talking about the Bank of Amsterdam, but the servant didn’t hear that part.

“What’s a fractional reserve bank again?” the lawyer asked. Over the past months since Sarah had been in Vienna, she had found herself with an extra occupation. And it was all Karl’s fault. He had introduced her as an expert witness in several of the cases against his family that were based on the Kipper and Wipper panic, which happened ten years before the Ring of Fire. Mostly, what she had done in those cases had been to explain that Liechtenstein, Wallenstein, and the others hadn’t known any better because no one had known any better. But to do that effectively, she had had to demonstrate that she did know better and was recognized by the financial community as an expert in financial matters.

Based on her proven expertise, she had been asked to testify in all sorts of cases that involved finance in some way. This case involved the Bank of Amsterdam and its double bank structure, which gave the illusion of being a full reserve bank, but with many of the advantages of a fractional reserve bank. The servant put the hot tea with lemon and honey on the table and Sarah thanked her, then answered the lawyer’s question. “They don’t have enough silver in their vaults for the amount of money they issue.”

The servant left the room and the lawyer asked how they got away with it. Sarah explained, but by then the servant was down the hall, convinced that the Royal Bank of Austria-Hungary didn’t have enough silver in its vaults for the reich money issued. This information, she repeated with great confidence. Then added that as an employee of the Barbies, she got paid in BarbieCo.

* * *

The maid was by no means the first person to suggest that the full reserve Royal Bank of Austria-Hungary didn’t, in fact, have enough silver to pay off all the people who were carrying around and circulating bank notes. The level of confidence in that claim had never been great, and the unwillingness of the crown to allow independent confirmation had done nothing to reassure the financial community. Abraham and Moses Abrabanel’s reassurance had helped some, but Gundaker’s somewhat strident insistence had actually hurt confidence.