“‘The patriotic people of France raised the vast sum by a loan in less than six months from the time the government appealed to them. Germany expected to receive for years to come five per cent. per annum on the indemnity bonds; but the Bank of France, through the French bankers, drew on Germany, England, Scotland and Belgium, and in four months’ time the whole indemnity was paid. Never in the history of the world has this financial transaction been equaled, and I doubt that any other banking institution could have succeeded so well as the Bank of France. Germany expected the payment in gold coin or bullion, having previously and purposely demonetized silver. But the fact remains that actually in gold only 273,003,050 francs, equal to $54,600,610, was paid by the Bank of France, and that sum only left France, was remelted in Germany and coined into reichsmarks. England, with her gold standard, had to part with her gold to the amount of 637,348,832 francs, equal to $127,469,964. Bills of exchange on the German bankers throughout the German empire, especially on Hamburg, Berlin and Frankfurt, came to 3,064,901,180 francs, equal to $612,986,236, nigh on two-thirds of the whole amount of the indemnity. This magnificent stroke of finance on the part of the Bank of France and the French bankers came near ruining the leading German bankers; and forty-one banking houses throughout the German empire had to suspend temporarily, not being able to honor the drafts made upon them. The extravagance of the German people during the war of 1870-71 brought them into debt to France for luxuries, wines, etc., to an enormous extent; and when the Bank of France purchased bills of exchange from the French bankers, who drew on their German correspondents, a panic ensued, and the Germans suffered more than is generally supposed.’” The above from Michels shows that he saw but dimly what Phillips saw so plainly, that government paper money, nourishing all industries, gave France that victory. Michels catches a glimpse of the truth when he speaks of luxuries, wines, etc. To get a clear view of the French financial genius we have to go back to 1848, when Louis Philippe abdicated and the republic was founded amid great confusion. The French have an instinct for finance far superior to anything yet shown—by our rulers at least—in England and America. “Paris,” says Victor Hugo, “is the city of the initiative.” It is not afraid to start things. It is not, like Washington and New York, always asking what London would do or think. Taking Louis Blanc’s advice in 1848, it started national work-shops to insure the employment of surplus labor. Those did good for a time, but they were soon perverted and destroyed by a treacherous Jew who got hold of them.