In England itself the victory of the Archduke Charles raised expectations of peace. The war had become unpopular through the loss of trade with France, Spain, and Holland, and petitions for peace daily reached Parliament. Pitt so far yielded to the prevalent feeling as to enter into negotiations with the Directory, and despatched Lord Malmesbury to Paris; but the condition upon which Pitt insisted, the restoration of the Netherlands to Austria, rendered agreement hopeless; and as soon as Pitt's terms were known to the Directory, Malmesbury was ordered to leave Paris. Nevertheless, the negotiation was not a mere feint on Pitt's part. He was possessed by a fixed idea that the resources of France were exhausted, and that, in spite of the conquest of Lombardy and the Rhine, the Republic must feel itself too weak to continue the war. Amid the disorders of Revolutionary finance, and exaggerated reports of suffering and distress, Pitt failed to recognise the enormous increase of production resulting from the changes which had given the peasant full property in his land and labour, and thrown vast quantities of half-waste domain into the busy hands of middling and small proprietors. [54] Whatever were the resources of France before the Revolution, they were now probably more than doubled. Pitt's belief in the economic ruin of France, the only ground on which he could imagine that the Directory would give up Belgium without fighting for it, was wholly erroneous, and the French Government would have acted strangely if they had listened to his demand. [Bonaparte creates a Cispadane Republic, Oct., 1796.]