Frank Thomas - Sherlock Holmes and the Treasure Train

Holmes' expression had a yes-and-no quality, and the banker explained with a gusto surprising from one so frail.

"To facilitate their rapid sale, the French incorporated a proviso that the bonds could be redeemed two years after their issuance in gold. That's pure mumbo-jumbo. Having the bonds redeemable prior to expiration date might just as well have specified francs, but gold is the lure to the investor. Whenever a currency is troubled people run to gold, which is the ultimate currency."

The man's face had strayed my way and he must have noted a puzzlement for he chose to elaborate on his last sentence. "You have in your wallet, Doctor, a pound note. Of itself it is valueless, being naught but engraved paper. The fact that it is a medium of exchange for so much gold is what gives it value. The pound sterling is the most stable currency in the world, so it is of no difference whether you have your pound note or its equivalent in gold."

"The note being more convenient to carry," I replied, just to indicate that I was aware of the point he was making.

"Of course. But to the investor, the knowledge that he can cash in his bonds for gold produces a comforting feeling. Gold can be buried and hoarded. It is the constant in the fluctuating world of finance."

"And the French need the metal," stated Holmes.

"The need is artificial," replied Hananish. His manner became that of a patient instructor with two backward students, which, no doubt, delighted him. It crossed my mind that it must have pleased Holmes as well since this information seemed most germane to our case at hand. "The Credit Lyonnais is a very stable banking house. Because of that cursed Netherlands-Sumatra matter, there was a minor swell of panic in the public mind, which has not as yet subsided. The two-year redemption date is close upon us and the French anticipate that nervous investors will be at their door before long to cash in their bonds prior to the expiration date, as is their right. If investors request payment in gold, the Credit Lyonnais had better have it or suffer a mortal blow to its reputation. Gold, in bulk, flows from country to country dependent on history mostly. During the French Revolution, a lot of the metal found its way here. During the far-flung conquests of the Corsican, a lot of it came to France in the same manner as many of their treasures in the Louvre. At one time we were buying heavily from them before the African mines began producing so well. At the moment, English banks have a heavy backlog. When the Credit Lyonnais need became known to me and others, we were glad to enter into an agreement with the French to supply them."

The banker's tapered fingers gestured expressively as though he had made the whole matter as clear as he could.

"A shrewd piece of business, I would hazard," said Holmes. "You could hardly lose unless . . ."

As Holmes' words hung in midair, there was an alarmed reaction from the financier. "We could not lose, Mr. Holmes."

"Then the Birmingham and Northern is capable of reimbursing you for the value of the shipment?"

To my amazement, Hananish actually guffawed, something I never expected this frigid man to do. "Mr. Holmes, you jest. Alvidon Chasseur is on the verge of becoming the leading railroad magnate in England. His rise from ownership of a minor trunk line to his present position is a story-book saga akin to the writings of that colonial Horatio Alger. In any case, he had the shipment insured. You know that."

Holmes shrugged. "What about Inter-Ocean? Can they meet the face value of the insurance policy?"

Hananish's unexpected humor disappeared to be replaced by a glacial hauteur. "You make mock of me, Mr. Holmes. You have had dealings with the company. Your solution of the attempted embezzlement by one of their directors is common knowledge. You can hardly think that Inter-Ocean is shaky."

The banker was right, of course, but Holmes wasn't going to let him know it. "Sir, what I, as a layman, think about such matters may be a far cry from what you, an expert, know."

Hananish had to retreat in the face of this statement. "Of course. Of course. Do forgive me."

Holmes did not abandon the stern look he had adopted, and as the financier rushed ahead, apologetically, I thought, He's done it again. This esthetic dictator would not willingly give the time of day and now he's singing merrily simply because Holmes knew how to wind up his gramophone.

"Perhaps I'd better go over the entire matter," Hananish suggested, and Holmes indicated that this would be acceptable.

"Chasseur's railroad and the Inter-Ocean insurance company are but middlemen in the deal. A consortium of banks, of which I am a member, was well able to make the gold available. The French issued certificates of indebtedness to us for half a million pounds plus a fee." Hananish caught himself and corrected his last statement. "For the equivalent in French francs actually, but that is unimportant. The certificates are convertible, quite as good as currency. With one I could go to any major bank in the world and secure the face value."

"But since the French did not receive the gold, those certificates are not convertible?"

"We shall be reimbursed by the insurance payment."

"Unless the gold is found," I stated, glad to make a comment.

"It is to be hoped that it is," agreed Hananish quickly. "Otherwise Inter-Ocean is the loser and the thieves the winners."

"If the gold is not found, what will the Credit Lyonnais do?" inquired the sleuth.

"Make an arrangement with someone else. Possibly the Deutsche Bank." Again Hananish paused and corrected himself. "Though I am not informed as to their gold reserve at this time. However, the need will be filled." His eyes, a soft shade of blue, swiveled to me briefly and then returned to my friend. "If the subject interests you, might I point out an unusual factor?"

"By all means," replied Holmes.

"Under normal circumstances the gold need not have left our vaults. Upon receipt of the certificates from the Credit Lyonnais, we would have issued demand notes making the gold available to whomsoever presented them. Said notes would go to a French bank, or any European bank for that matter, and would be honored. But psychology enters the scene. The panicky subscriber to the Credit Lyonnais bond issue presents himself at its doors and wants the gold in his hands. He really doesn't need it, you see, but that is the way of the world. Do you follow me?"

Holmes nodded. I did not, but that made no difference. "This gives me a clear picture of the transaction," stated Holmes. "Dr. Watson and I are grateful, and our trip has proven worthwhile."

As he rose and made as though to depart, Holmes posed another question, a device that I had seen him use on other occasions.

"What happens now to the certificates from the Credit Lyonnais?" Hananish's thin lips pursed in a moue. "They are quite worthless, of course, unless you can locate the gold, Mr. Holmes."

"Yes, there still is that possibility," replied my friend. He did not sound enthusiastic, but I discounted this since Holmes was always a superb actor.

At this point we made our departure from the overly quiet, somewhat ominous home of Burton Hananish, who had been maneuvered into giving us a lesson in the mechanics of international finance. Or perhaps he just thought he had.

Chapter 10

The Battle on the River Road

AGAIN THE pattern of our investigation took a swerve from the norm. Instead of returning to Fenley proper and boarding the first train for London, my friend chose to prolong our west country interlude. He directed our vehicle to the inn and reserved rooms. Something, which had evaded me completely, had gotten the wind up for Holmes since he was never quite comfortable when removed from his beloved London and its teeming millions. Happily, he did not bury himself in thoughtful silence but was disposed to explain his latest move.