Editing Louisiana Purchase (section)

==Financing==
[[File:aandeelLouisianaPurchase.jpg|thumb|''Share issued by Hope & Co. in 1804 to finance the Louisiana Purchase''<ref>{{Cite thesis|title=Private Interest and the Public Sphere: Finance and Politics in France, Britain and the Netherlands during the Age of Revolution, 1789–1812|last=Valmori|first=Niccolò|date=2016|publisher=European University Institute|location=Fiesole, Italy|type=PhD|doi=10.2870/536147}}</ref>]]
To pay for the land, the American government used a mix of sovereign bonds and the assumption of French debts. Earlier in 1803, [[Barings Bank|Francis Baring and Company]] of London had become the U.S. government's official banking agent in London following the failure of [[Bird, Savage & Bird]]. Because of this favored position, the U.S. asked Barings to handle the transaction.<ref name="Barings">{{cite book|title=Transatlantic Finance in the Age of Revolutions. Hope, Baring, and the Financing of the Sale and Purchase of Louisiana |last=Hay |first=Mark Edward |date=2024 |publisher=Palgrave Macmillan |location=Cham, Switzerland |isbn=978-3-031-65231-8 |pages=17–45, 89–138}}</ref> Barings had a close relationship with [[Hope & Co.]] of Amsterdam, and the two banking houses worked together to facilitate and underwrite the purchase.<ref>{{cite web|url=https://geneagraphie.com/histories/faHope-Co.pdf |title=Aspecten van de Geschiedenis van Hope & Co en van Gelieerde Ondernemingen|language=nl|trans-title=Aspects of the History of Hope & Co and Affiliated Companies|date=2018-08-31|publisher=Archief van de Firma Hope & Co. met verwante archiefvormers}}</ref> Hopes brought to the transaction experience with issuing sovereign bonds and Barings brought its American connections.<ref name="Barings"/>

[[Sir Francis Baring, 1st Baronet|Francis Baring]]{{'s}} son [[Alexander Baring, 1st Baron Ashburton|Alexander]] and Pierre Labouchère from Hopes arrived in Paris in April 1803 to assist with the negotiations.{{sfnp|Ziegler|1988|p=70}}<ref name="Barings"/> With the bankers' help, the French and American negotiators settled on a price of 80 million francs ($15 million), down from an initial price of 100 million francs, a sum the Americans could not afford and the financers could not provide.<ref name="Barings"/> In the final agreement, the value of the U.S. currency was set at {{sfrac|5|3333|10000}} francs per U.S. dollar.<ref>{{cite book|chapter=Convention Between the United States of America and the French Republic (Article III)|orig-date=April 30, 1803|title=United States Statues at Large|volume=8|editor-last=Peters|editor-first=Richard|publisher=Little, Brown & Co. |location=Boston, Massashusetts|date=1867|page=208|chapter-url=https://memory.loc.gov/cgi-bin/ampage?collId=llsl&fileName=008/llsl008.db&recNum=221|via=Library of Congress}}</ref> In {{Inflation/year|US-GDP}} dollars, the $15 million purchase price is equivalent to about ${{Inflation|US-GDP|15|1803|fmt=c}}&nbsp;million.

As part of the deal, the U.S. assumed responsibility for up to 20 million francs ($3.75 million) of French debts owed to U.S. citizens. The remaining 60 million francs ($11.25 million) were financed through U.S. government bonds carrying 6% interest, redeemable between 1819 and 1822.<ref name="Barings"/> In October 1803, the U.S. Treasury had some $5.86 million in [[coin|specie]] on hand, $2 million of which would be used to pay a portion of the debts assumed from France as part of the purchase.<ref>{{cite book|title=Annual Report of the Secretary of the Treasury on the State of the Finances: 1789&ndash;1980|chapter=Report on the Finances, October 1803|last=Gallatin|first=Albert|date=January 1803 |author-link=Albert Gallatin|publisher=U.S. Department of the Treasury|page=263|chapter-url=https://fraser.stlouisfed.org/title/194/item/5642?start_page=3}}</ref>

Because Napoleon wanted to receive his money as quickly as possible, Barings and Hopes purchased the bonds for 52 million francs, agreeing to an initial 6 million franc payment upon issuance of the bonds followed by 23 monthly payments of 2 million francs each.<ref name="Barings"/> The first group of bonds were issued on January 16, 1804, but the banks had already provided a 10 million franc advance to France in July 1803. In need of funds, Napoleon pressed the banks to complete their purchase of the bonds as quickly as possible, and by April 1804 the banks transferred an additional 40.35 million francs to fully discharge their obligations to France. In the end, Barings and Hopes acquired the $11.25 million in bonds for just $9.44 million.<ref name="Barings"/> The last of the bonds were paid off by the United States Treasury in 1823; with interest, the total cost of the Louisiana Purchase bonds amounted to $23,313,567.73.<ref name="Klein-LoC">{{Cite web |last=Klein |first=Michael |title=A Question of Boundaries |url=https://www.loc.gov/collections/louisiana-european-explorations-and-the-louisiana-purchase/articles-and-essays/a-question-of-boundaries/ |access-date=2023-05-11 |website=Louisiana: European Explorations and the Louisiana Purchase |publisher=Library of Congress |location=Washington, D.C.}}.</ref>

Although the [[War of the Third Coalition]], which brought France into a war with the United Kingdom, began before the purchase was completed, the British government initially allowed the deal to proceed as it was better for the neutral Americans to own the territory than the hostile French.<ref>{{Cite web|title=Financing the Louisiana Purchase |first=Daniel |last=Dematos |url=https://tontinecoffeehouse.com/2018/11/19/financing-the-louisiana-purchase/|date=2018-11-19|website=The Tontine Coffee-House|access-date=2020-05-03}}</ref> However, by December 1803, the British directed Barings to halt future payments to France. Barings relayed the order to Hopes, which agreed but under the condition that Baring bear the costs of the change and that its Louisiana stock be reallocated to Hopes. Hopes also required Baring to refrain from trading in Louisiana stock without its consent.{{sfnp|Hay|2024|pp=115-118}} The final payments were made to France in April 1804.{{sfnp|Ziegler|1988|p=71–72}}