Austro-Italian ironclad arms race
Austria's defeat in the Seven Weeks War forced Austria to determine a new set of foreign and domestic policies for the future, as Austria's interests since the days of the Holy Roman Empire had primarily been found in Italy and Germany. The Empire thus reformed itself into the Austria-Hungarian Empire following the adoption of the Austro-Hungarian Compromise of 1867 (German: "Ausgleich"), which re-established the sovereignty of the Kingdom of Hungary and placed Hungarians within the Empire on an equal footing with Austrians. Under the "Ausgleich", Emperor Franz Joseph I would be crowned as King of Hungary, while a separate parliament at Pest with powers to enact laws for the lands of the Holy Crown of Hungary would be established.
Charles VII, Holy Roman Emperor
Shortly after the coronation most of Charles Albert's territories were overrun by the Austrians, and Bavaria was occupied by the troops of Maria Theresa. The emperor fled Munich and resided for almost three years in the "Palais Barckhaus" in Frankfurt. Most of Bohemia was lost in December 1742 when the Austrians allowed the French under the Duc de Belle-Isle and the Duc de Broglie an honourable capitulation. Charles Albert was mocked as an emperor who neither controlled his own realm, nor was in effective control of the empire itself, though the institution of the Holy Roman Emperor had largely become symbolic in nature and powerless by that time. A popular Latin saying about him was "et Caesar et nihil", meaning "both Emperor and nothing", a word-play on "aut Caesar aut nihil", "either Emperor or nothing". Charles Albert's general Ignaz Felix, Count of Törring-Jettenbach was compared to a drum, as people "heard about him only when he was beaten".