"Oh? They sure know how to exploit the government's weaknesses," a cold light flashed in Joseph's eyes.
After serving as the assistant to the Finance Minister, he had gained a clear understanding of France's financial situation. A significant portion of the money borrowed by the government came from wealthy nobles, accounting for more than twenty percent.
If one also considered the money nobles deposited in banks and the state bonds they purchased, they were arguably the largest group of creditors to the government's debts.
That is to say, if the nobles were to stop providing funds to the government, the national finances would quickly become unsustainable. Historically, these characters had instigated the "Anti-Tax Alliance," using tax resistance to blackmail the Royal Family, and ultimately they succeeded.
No wonder Brian came hurrying to Paris to find himself; he truly feared the nobles would come to blows with the government.
Brian said with an anxious look, "Your Highness, shall we postpone the trial of Necker and have him pay a fine first..."
Joseph frowned, "What, are you scared by those nobles?"
"No, it's not that." Although Brian was saying "it's not that," his expression was filled with tension, "But you know, if they really did that, even if only a small half of them did, the finances would..."
Brian wanted to say more, but Joseph gestured towards his carriage, "Let's go to the Palace of Versailles and discuss it on the way."
The carriage started slowly, and inside, Joseph asked, "Archbishop Brienne, have there been similar commotions caused by bank bankruptcies before?"
Brian shook his head in recollection, "Your Highness, it was usually just one bank with problems, and since it wasn't related to any case, the bankruptcy process wasn't so swift, giving people time to manage their investments in the bank."
"But this time Belanger Bank collapsed too quickly, and with over a dozen more banks facing bankruptcy soon after, everyone is terrified."
Joseph nodded, "So, the reason the nobles are reacting so furiously is because Belanger Bank did not settle its debts, nor did it announce a plan to offset debts with credits, abandoning all their investors?"
"Precisely, Your Highness."
Joseph narrowed his eyes in thought for a moment, then continued, "So, if someone were to acquire Belanger Bank now and promise the nobles to acknowledge and repay their investments, they'd immediately be satisfied and disperse?"
Brian said with a pained expression, "But as it stands, nobody is willing to buy it, because no one knows how much the bank will have to pay in fines..."
He paused as if realizing something, "You mean, to waive its fines?"
Joseph immediately shook his head; if those involved banks weren't penalized, wouldn't that mean allowing them to sheer millions or even hundreds of millions of livres off the government for nothing!
The current problems all focused on how to pay the nobles' investments.
He reviewed all the banking and financial operations from future knowledge, yet found no ready-made solution. Brian was even more clueless, only able to look at him with a frown.
As trees and buildings whipped past the window, Joseph thought about the various ways these great nobles had previously hampered him and damaged the country, and he felt a surge of anger.
He punched his fist onto the seat, grinding his teeth, "Just confiscate all those bastards' money!"
He exhaled, knowing it was just a temperamental outburst...
Wait... a new thought occurred to him. Although he couldn't confiscate the nobles' money, he could delay payment to them!
If it could wait five or seven years for France's financial issues to alleviate, the country would be fully capable of paying off these debts.
Therefore, some tactics would be required to make the nobles "voluntarily" leave their money behind.
When it came to tactics, he immediately thought of "debt-to-equity swap," but felt it wasn't quite right; the shareholding system of that era was far from perfect, and it wouldn't be easy to handle such a large amount.
Then he considered a variation, something like a "debts-to-funds swap"...
As the carriage left Paris City, Joseph looked up at Brian with a smile, "If no one acquires it, then my Bank of France Reserve will make the purchase."
"Your bank?" Brian exclaimed in shock, "Your Highness, if you want to acquire Belanger Bank, not only will you need the acquisition costs, but you will also need to prepare a large sum to pay the investments the nobles might reclaim."
"And even if you manage to gather the funds to acquire Belanger Bank, there are still over a dozen more banks that are going to fail. You can't possibly acquire all of them, can you?"
Joseph smiled, "Why not? I indeed plan to acquire all of them."
"But where would you get such a vast amount of money?"
Joseph shook his head, "There won't be a need for much money."
"The banks' credits minus their debts generally result in an asset balance of several million to tens of millions of livres. And because of these cases, the government can impose fines equal to the value of these assets."
"Then the government can use the amount fined to invest in the Bank of France Reserve, allowing the bank to complete the acquisition at zero cost."
The so-called bank's credits were the loans lent out, most of which were to the government. The debts were the deposits from the public and the investments from the nobles. After offsetting the two, plus the bank's cash, tangible assets, and so on, one has the bank's net assets.
Brian patiently explained, "Your Highness, that is true in the ledger accounts. But once you've acquired those banks, if the nobles want to reclaim their investments, you will need to pay them. Meanwhile, the assets, which are loans to the government, cannot be recovered immediately."
Joseph calmly said, "As long as the nobles don't reclaim their investments, that will do."