Of Money and Its Makers

I’VE always wondered why a quotation from Arthur Hugh Clough isn’t just as well known as My luve is like a red, red rose or I am the master of my fate. The quote I have in mind is

How pleasant it is to have money, heigh-ho!
How pleasant it is to have money,

and surely the pleasantness of money ranks not far behind the rosiness of love or the outgeneraling of fate. What Clough praised, it is true, is not overpoweringly spiritual or elevated and was once, in genteel circles‚ considered unmentionable. Yet what a splendid, spirited truth Clough has so jauntily enunciated; who can blame him for insisting on saying it twice (actually he said it much, much oftener‚ to conclude a dozen or more stanzas)? For money — the making it, saving it, spending it; and the losing it, or lack of it, or love of it — money as the matinee idol of our daydreams and the swarthy scoundrel of our realities is the Feast Day and Fast Day ot existence. If conceivably too mundane for poetry, think what fiction or drama would have been without it, particularly in its less hallowed forms — tainted money, hush money, blood money.

Yet about the actual real-life manipulating and amassing of money — about the concrete world of business and finance — not very much has been transformed into lasting literature. There are the apologias and official histories and biographies, countered by the muckrakings and exposés, notably Gustavus Meyers’ Great American Fortunes. And, something quite different‚ there are the treatises of analysts and theorists, in which money ascends into economics, leaving those of us for whom a dime is a dime is a dime stranded. But there are few really classic works about moneyed potentates‚ as there is even a classic History of the Potato; and though we enjoy what is magical and colorful and off-color about the great banking careers, there is little that achieves for the man in the Street what is often done for the man in the lab‚ or the law court, or the ivory tower.

With more in mind than why those who have such great luck in life have had so little in literature — with the steady flow of money-minded books promising an interest of their own — I have been reading a few of the more recent ones. One of them deals with Wall Street‚ another with banks, a third with merchant bankers, a fourth with merchants. They concern‚ naturally enough‚ formidable success stories, tempered here and there with nervous prostrations and panics. Nontechnical and untheoretical, they nowhere require what someone called the business equivalent of knowing Greek, the effortless reading of a balance sheet. Much of the time, indeed, they tend to turn economics into price tags and statistics into Twenty Questions.

In The Plungers and the Peacocks (Putnam‚ $5.95)‚ Dana L. Thomas provides a kind of running history of Wall Street, often celebrating its best-known traders‚ and dealing less in general market strategy than individual tactics. The book very agreeably combines straight information with lively, occasionally crooked drama. First visiting Wall Street when Captain Kidd resided there, we move on to 1792, when twenty-four independent brokers founded the original Stock Exchange; to 1815‚ when the newspapers started carrying trading prices; to March 16, 1830, when exactly thirty-one shares changed hands; and so to 1861 and one of the very first sales of a seat on the Exchange (it brought $460 for charity). During the same era, a member leaving the Room (when did Floor take over?) while a call was in progress was fined 25 cents, unless he had to go to the toilet. As the book proceeds, we are shown what a great trading benefit the telegraph became, and then the cable, the telephone, the ticker; and we are given a seminar on washed sales, driving stocks up and driving them down‚ along with the history and hysteria of selling short. Holland forbade short selling as early as 1610; England, for a time, after 1733; and Napoleon looked upon it as treason. Banned for a while in New York State, it only led to brisk under-thecounter transactions; while the “corner,” by which a manipulator tricked others into selling short and then bought up all the available stock, called forth grim comment from the notorious Daniel Drew?

He who sells what isn’t his’n
Must buy it back or go to prison.

Mr. Thomas’ dramas extend from Jay Gould and Black Friday to the gloomiest hours of 1929, and the Street’s catastrophes, I must admit‚ make better reading than its coups. The disasters have something at once very human and very inhuman about them; an icy calculation and a feverish recklessness; gambling of epic proportions and finagling of diabolical ingenuity. Much of all this adorns the age and ascendancy of the elder Morgan — there was to be no such autocrat thereafter — and it is pretty much epitomized in his message to the trustbusting President, TR: “If we’ve done something wrong, send your man to my man and they can fix it up.”

Mr. Thomas does a scholarly job with panics and runs on banks‚ particularly the 1907 panic when the plight of three New York institutions (the Knickerbocker Trust, the Lincoln Trust, and the Trust Company of America) threatened the whole Street with ruin, and when not Morgan’s man but Morgan himself took command, rapped out orders, stemmed the panic, and emerged “more than ever the lion of Wall Street.” Mr. Thomas does nicely, too‚ by the top manipulators, the syndicates and power plays of the 1920s. There is, for one example, the long career of William Crapo (“Billy”) Durant, who early in the century converted the bankrupt Flint Wagon works into the Buick Motor Company; in due course “snapped up Cadillac, Oakland and Olds,” tying them all together as General Motors; and in 1908, had his bankers not balked, would have bought out Ford for $8 million. Bounced from GM in 1910, Durant, who just couldn’t “resist calling on inventors,” by doing so got going with Chevrolet as, long after, with Frigidaire. He became in time a top manipulator in the great 1924-1929 bull market, and among those joining his Wall Street “consortium” were the seven Fisher brothers, who, having sold the Fisher Body Company to GM, had $208 million to try their luck with. Of the Crash itself, far too much has been written for Mr. Thomas to provide anything very new; but he does remind us how disastrously much occurred after 1929, with the market going down, down, down until 1932, to fall at its worst 86 percent below the Black Tuesday mark.

Mr. Thomas’ book marches right up to the present and on into the future, into a Wall Street when half the holdings may belong to institutions, to mutual funds and pension funds, and when technology — 90 percent of all scientists who have ever lived, says Mr. Thomas, are alive today — will create a whole new economy, with credit cards supplanting cash, and with computers everywhere, even portable ones that direct the driving of a car. It is indeed a subject for speculation.

Banking is, or purports to be, something else, something carpeted with decorum and frock-coated with dignity. It is without doubt, as we learn from Banks of the World (Walker, $10.00), by a French authority, Roger Orsingher, a most venerable profession, being already well outlined in the Code of King Hammurabi of Babylon (1728-1686 B.C.). The Code deals with “nearly all cases arising from loans, interest, pledges, guarantees . . . loss, theft, etc.” Banking was also a most dignified profession from the outset: palaces and temples, at any rate‚ were the earliest places where people “deposited” their wealth (often crops) for safekeeping, and where private accounts were set up‚ loans negotiated, and interest rates fixed. By Greek times, coinage and money changing flourished; the money changer, by acting more and more as an agent and depositary, himself changed into a banker, the not inept Greek word for which was trapezite. By Roman times, and with the vast growing commerce of the Roman Empire, bankers were numerous and their operations diverse: they served as stockbrokers, auctioneers, money changers, discounters, credit institutions. Maximum interest rates were fixed, sometimes officials also. Roman laws established important banking controls, only for banking to disintegrate after the barbarian invasions. It came alive again during the Crusades, with their confusion of currencies, their need for loans and bills of exchange, their fear of carrying large sums on one’s person. The Jews, the Genoese, and, most notably, the Lombards became successively Europe’s leading bankers, while even more than the Crusades, the great medieval fairs made for every form of finance. In time, Lyons and Antwerp became great financial centers, and the Medici and the Fuggers great financiers. In England, immensely rich Thomas Gresham (15191579) evolved not only Gresham’s Law but what was mostly Gresham’s Royal Exchange‚ from which it is only a step or two to modern times.

After its opening “Historical Survey,” M. Orsingher’s useful book becomes largely a handbook, setting forth banking developments throughout the world, with statistical trimmings and tabulations. To cite a few such: the bank with the biggest holdings is the Bank of America ($14 billion); of 110 commercial banks with a billion or more in deposits, the United States leads with 34, Japan coming second with 19; the oldest commercial, bank is the Banco di Napoli (1539), the oldest private bank, Koch, Lauteren in Frankfurt (1586).

Dollar signs, £.s.d.‚ and a sense of decorum continue with us in Joseph Wechsberg’s The Merchant Bankers (Little, Brown, $6.95), almost all of whom “were merchants before they were bankers.” The book deals more with dynasties than deposits, with bankers and their wealth than banks and their assets, and provides pleasantly informal profiles of a species hard to catch full-face. Among Mr. Wechsberg’s best subjects are the Barings, that great, more than 200-years-old English house, who leave their name off their letterheads, can boast five peerages, and provide the present Governor of the Bank of England. In their first hundred years‚ they did much to make Britannia rule the waves; later they became London’s biggest “American” house, being indeed the great bankers of Europe till they came up against the Rothschilds. Their greatness was perhaps best displayed in 1890 when, having overextended themselves in South America‚ they were faced with ruin‚ and the whole City — partly, to be sure‚ because the ruin must spread — collectively raised £l7‚500,000 for them. Indeed, nobody wanted to be excluded: to guarantee the Barings became a kind of status symbol. It must have been this crisis that produced the best play-on-threewords — which Mr. Wechsberg does not record — that I have ever encountered. “What‚” went the question, “is the capital of the Rothschilds?”; and the answer: “Baring straits.”

The book’s only American call — it visits, among others, Italy’s Mattioli and Germany’s Hermann Abs — is on Lehman Brothers, who, says Mr. Wechsberg, “achieved the greatest post-war growth in Wall Street” and, says Fortune, are “one of the biggest profit makers — many believe the biggest — in the business.” Beyond their own achievement, they serve to contrast American finance with European, Wall Street with the City. Unlike the City, says our author‚ Wall Street is not internationalminded ; he received from one prominent Wall Street banker a copy of his What I Know About Foreign Securities, in which all the pages were blank. Again unlike the City‚ Wall Street does not esteem “the successful eccentric”; it desires organization men with the “right” connections. At a Lehman Brothers’ lunch‚ everyone talked about what was on his mind; at lunch in London, says Mr. Wechsberg, they talk of everything except that. A London bank man complained that in New York “no one would talk to me without first consulting his lawyers,” and Mr. Wechsberg goes on to sum up the Street: “There are too many partners, too many meetings, too many experts, too many lawyers.”

He might have added “too many bromides.” Lehman Brothers’ senior partner, Robert Lehman, “a cautious-looking banker” whose magnificent picture collection lives alone in an uninhabited house‚ ventures such audacities as “Wall Street is a competitive community.” In all fairness, perhaps bankers’ bromides derive as much from their wanting to sound inane as from their being by nature stuffy; yet, even in an age that has slaughtered privacy and swims with publicity-seeking, the wanting to keep banking facts in safety-deposit vaults seems a bit dubious. At any rate, though Mr. Thomas does not write as well as Mr. Wechsberg, the stuffed pockets he features make livelier reading than Mr. Wechsberg’s stuffed shirts.

The Great Merchants (Harper & Row, $6.95) by Tom Mahoney and Leonard Sloane‚ an enlarged edition of an earlier book by Mr. Mahoney, has nothing vaultlike about it; it tosses you around among shopping centers, bargain hunters, basement buffs; among mergers and mergers of mergers; among department stores like Harrod’s in London that arrange funerals, and Mitsukoshi in Tokyo that perform marriages. Hoisting such statistics as that America’s 1965 retail business came to $283.9 billion, the book gives the dollar sign all the publicity of a sky sign. Since the stories are all by definition success stories‚ they are prize packages of glittering and gratifying facts. But they have small value as success studies; and the book itself is ill titled‚ dealing far more with great businesses than great merchants. This is not important; what is, I think, is the facile handling of the people and projects involved, the authors’ pen proving no better a paintbrush than a scalpel. These fat fortunes often make curiously thin storytelling; the book’s chief virtue is the picturesque useless information it offers, and the envy its statistics can arouse.

Thus the Hudson’s Bay Company, the world’s oldest retailer (1670), long issued its own money and in 1966 took in $370 million of other people’s. General Grant, Theodore Roosevelt, and Woodrow Wilson were inaugurated, and Lincoln was assassinated, in Brooks Brothers clothes. Filene’s in Boston were the first to use the Charga-Plate, and their unrivaled basement once bagged 150,000 bargain hunters in a single day. The A & P buys three billion eggs a year, while Sears Roebuck grosses six billion dollars. Reversing the old trend, Sears today does only 25 percent of its business from catalogues, just as Lane Bryant does only 5 percent with maternity garments.

There are many duller, and sometimes solider, facts and figures in The Great Merchants; the book as a whole suggests a routine blend ol legwork and handouts for which, at precisely its level, there is a waiting audience. Great merchants’ aphorisms are hardly more subversive than great bankers’. “I always believed that the store would grow if it had the right kind of people,” said Lincoln Filene, “and that if it didn’t have the right kind of people, it wouldn’t grow.” “No one,” insisted the A & P’s John Hartford, “can be asked to do better than his best.” Yet here too‚ perhaps, the verbal nonglitter is simply a variation on Silence is Golden; and the complicated, often self-evasive man of action is less easy to penetrate‚ or even evaluate, than he may seem. Against the relatively few ruthless buccaneers, there are all the sincere (because nonconscious) hypocrites serving God and Mammon the same food at separate tables. Still, even old-school merchants and clothiers seem far less sanctimonious than the once fashionable man of the cloth, the Reverend Morgan Dix of New York’s Trinity Church, who at the opening of New York’s new Stock Exchange in 1903 concluded his prayer with: “The silver is thine and the gold is thine, O Lord of Hosts!”

What is disappointing in these chronicles is a lack of real substance‚ not to mention style; except as reading matter, they seldom seem to matter. Is the answer that water cannot rise above its own level and that you can at most achieve two-dimensional portraiture by way of semipromotional prose? Or is the answer, very simply, that “Does Macy’s tell Gimbel’s?” goes for the public as well? No doubt until the “papers” of important businessmen and corporations, like those of writers and statesmen and scientists, come to repose in university libraries, we shall not have such access to their darker thoughts and more complex creative processes as we have in most other fields; nor will there exist the same invitation, or the same incentive, to scholarship. Meanwhile, the intelligent, educated reader at large, while far from spurning piquant details and lively digressions, may hope for something that‚ no more committed to indictment than endorsement, has rather more body to it and reveals just a little more mind.