21-BANK OF NORTH AMERICA

Mayer may have been busy in Frankfurt supervising the construction of Grunenburg Schloss, but American Independence and French aid to America was what foremost on his mind. After the Trenton defection of nearly 900 Hessians in 1776, and especially after the capture of Burgoyne’s army in Saratoga, in 1777, Louis XVI, impressed with Benjamin Franklin as a man and in awe of the American victories, had seized the moment and signed the Treaty of Alliance with the 13 Colonies, thus declaring war on England in the process. As of that moment, thanks to Benjamin Franklin’s diplomatic skills, France had decided to come to America’s aid.

The English High Command retaliated by attacking the French fleet which was in the Caribbean. Clinton, the new commander of the British forces, then sent Cornwallis to re-establish control over the southern colonies. Cornwallis’ army won major victories in Charlestown and Camden, but the English Navy had a bad time of it in the Caribbean. To make matters worse for the English, the American general, Nathaniel Greene, started hit and run tactics against Cornwallis, forcing the latter to chase him throughout the Carolinas. Eventually, Clinton had Cornwallis rest his demoralized army in the ice-free port of Yorktown in Chesapeake Bay. Clinton intended to resupply him as needed, and Cornwallis was to go back on the offensive after a much needed rest. But they hadn’t taken into account General Rochambeau, Commander-in-Chief of the French forces, and a great military strategist.

Rochambeau was a professional soldier trained in the art of warfare, and he singlehandedly coordinated the military operations that would lead to the Yorktown victory. He marched his very well rested and disciplined army out of Newport towards New York City, and as planned, he met up with Washington’s army at Wethersfield, Connecticut, in late May. When Rochambeau saw Washington’s army in tatters, he realized there was mutiny in the air. The troops had had it with Washington’s leadership and his ‘military family’, a group of young aides-de-camp who rode well bred horses with fine saddlery and spent a lot of time feasting with the General. So, Rochambeau proceeded to pay the American troops what was owed them, gave them food, proper uniforms and much needed military supplies. The allies then got ready to attack New York City. But when Rochambeau got word that Admiral de Grasse had defeated the English in the Caribbean, he had a change of plan.

He knew Cornwallis’ army was recovering in Yorktown and realized how vulnerable it was. It was obvious that defeating Cornwallis’ army would be easier and have a greater impact than facing Clinton’s well-entrenched and well-supplied army in New York City. After convincing Washington, he sent word to Admiral de Grasse in the Caribbean and Admiral de Barras in Newport informing them of his change of plans. Luckily for everybody, the two admirals agreed to go along with Rochambeau, and both headed for Chesapeake Bay. Admiral de Grasse got there first and easily defeated the English fleet off the Virginia coast, while Admiral de Barras arrived from Newport and blockaded Cornwallis’ army by positioning his fleet at the mouth of the York River. Having joined forces, the two French fleets easily outnumbered anything the British were able to muster. When Rochambeau and Washington arrived at Yorktown, they had the troops dig a siege line behind Cornwallis’ position, thus entrapping his army. The allies then tightened their stranglehold, digging a second siege line closer to Cornwallis’ army. As the naval and land artillery kept pounding away from both front and rear, Cornwallis didn’t have a chance. The English redoubts were taken one by one, forcing Cornwallis to surrender. When the English Parliamentarians learned they had lost another army, they decided to put an end to the war, but it wasn’t to be made official for another two years.

Meanwhile, in Frankfurt, Mayer was telling Gretel, his only confidante, how Haym had convinced a lot of Hessians to defect while he was under house arrest, and how Haym had later been named broker to the French Consul, and Treasurer of the French Army when he arrived in Philadelphia. Haym had then made sure the French army, as well as Washington’s army, the 13 militias, and the politicians had everything they needed. But now that the politicians were about to take over, Mayer hated to tell Gretel that he had chosen Robert Morris instead of Haym as the one to deal with Congress. Because America was no more ready than Europe to accept Jews in a leadership role, it was Robert Morris, a goy, who would look after Mayer’s finances in 1781. The continental currency that Congress had issued at the start of the war and that had somewhat helped to finance the war had by now completely depreciated. Fortunately for Congress and for Mayer, the ‘Morris Notes’ backed by the French gold had replaced the worthless currency.

When Gretel asked if Mayer has stolen the French gold, Mayer gives her a long homily on the magic of gold. He starts by telling her that it was officially all spent but that it remained stockpiled in his vaults. He continues by saying there are two ways of looking at gold bullion. The first is where the owner uses it to further his personal ambition in order to gain influence, and the second is where it is used to establish a credit system and to build a monetary system like Mayer was doing. The gold provided by France was doing what it was supposed to do. It was helping America win the war like Louis XVI had wanted, but it would do much more than that, it would help create a government, a country and an economy. When gold bullion is used to make more credit available, it becomes the cornerstone of the economic structure, whereas it accomplishes nothing if used as currency. Gold bullion is meant to be gathered in a pile, as huge as possible, and the pile is meant to remain inviolate and observable. The notes and the bills are issued and spent, but the gold stays in a neat pile. The banker who possesses the gold can issue bills of exchange in which everybody has the highest confidence, and as the pile of gold grows, it acts as a starter or mother for more notes and more bills. Confidence in the bills issued is what makes it all possible. Of course, the process of creating credit makes the gold holder richer, but beyond a certain point, getting rich is no longer the point, amassing more bullion and shoring up the monetary system is.

Creating credit is akin to controlling the monetary system, and controlling the monetary system isn’t about increasing the wealth of one individual, for that’s already a given in Mayer’s case, it’s about pointing the economy or the country in the desired direction and creating more credit and more wealth, and buying more gold. Elected individuals can’t possibly control a monetary system, for they are too subjective and think too short-term, and the monetary system is sure to founder under the weight of their greed, corruption and short-sightedness. Only objective private interests totally intent on building thriving market economies can succeed. However, because the privately owned Bank of England was myopic and parochial in nature, contrary to Mayer’s bank that was international in nature, his bank would one day take over the prestigious Bank of England.

He continued by giving a brief account of what had been accomplished so far. The Bank of North America had been created on May 26, 1781 by the Confederation Congress, at which time, Alexander Hamilton had recommended Morris for the position of Superintendent of Finance. The constitution for the Bank of North America had been drafted by Alexander and was modeled after the Bank of England. Morris had then submitted his legislative proposal based on that draft, and that’s how Mayer’s bank became the first private commercial bank in the USA.

When Robert Morris became superintendent of finance the continental currency had ceased to be issued. On April 30, 1781, Alexander Hamilton was advised to tell Morris that the bank’s capital would consist of 1,000 shares priced at $400 each. When Mayer offered Benjamin Franklin, who was still in France, a symbolic share in order to show the great American’s faith in the Federalists and his confidence in the new bank, he readily accepted. Thomas Willing, the original President of the bank of Philadelphia, and William Bingham, were both given shares as well. But Robert Morris held more than 90% of the shares, thanks to the French gold in his possession.

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20-WORKING FOR INDEPENDENCE

Franklin left Philadelphia on the 26th of October, accompanied by his son, William Temple Franklin, and his grandson Benjamin Franklin Bache, son of Sarah. Sarah was the daughter he had with Deborah Read, his common-law wife.

They sailed on board the Continental sloop-of-war Reprisal which carried sixteen guns. He had to be protected, for if Franklin had been captured by the English on the high seas he would have been hanged for treason. The 70-year-old American, widely referred to by the English as ‘chief of the rebels’ or as ‘General Franklin’, was deemed dangerous. The British Ambassador to France expressed his regrets that some English frigate had not met and dispensed with him on the high seas. However, he landed at Auray on the Loire River and made his way to Nantes with great difficulty. From there, the 250-mile trip into Paris was like a triumphal procession. He was wined and dined by scientific and literary notables on the way, and his entry into Paris caused a sensation.

Franklin’s fame was due not only to his scientific reputation, but also to the French rage for what philosopher Rousseau called ‘the natural man’. There was a vogue for things American in France at this time. Many French intellectuals looked to America as a new world, a fresh world, a world where human nature was closer to its natural origins. And Franklin, of course, was more than pleased to cater to French expectations. When he arrived in Paris, he was wearing a little fur cap to keep his bald head warm. To the French, the hat was the embodiment of the rugged American frontiersman and proof that Franklin was a true ‘natural man’. Even though no one knew what exactly he was doing in France, the French welcomed him with open arms, and he became a pop culture icon. Images of Franklin, wearing a fur cap instead of a wig, were depicted in paintings, engravings, medallions, rings, and snuffboxes.

After the Battle of Saratoga and the humiliating defeat of the British army commanded by General Burgoyne, Franklin, in spite of his struggling with the French language, used his charm, wit, and knowledge, to parlay this English defeat at the hands of American militias into a gigantic diplomatic victory. The French foreign minister, Count of Vergennes, wasted no time in officially acknowledging that the United States was an independent country. A formal treaty with France followed in 1778.

When he first arrived in Paris, Benjamin settled in Passy, a very affluent part of the city. It was necessary to seek out the French elite in order to achieve his goal. He had no direct access to the King, but he could influence those around him in order to get financial and military aid for America. He decided to do this in two ways. He would seek out the most select salon he could find, and since he was a freemason, he would frequent a local lodge, where the great men of the day, the enlightened ones, were members.

Upon his arrival he was introduced to the salon of Mme Helvetius in Auteuil. At the relatively late age of 29, Mme Helvetius had married the French philosopher and poet, Claude Adrien Helvétius, who had amassed a fortune as a Farmers General tax collector. The couple settled in the Paris suburb of Auteuil, and Minette, as she was called, opened a salon where she entertained some of the greatest figures of the Age of Enlightenment. Among them were Suzanne Necker, Diderot, Duclos, André Chénier, Condorcet, l’Abbé Sieyès, Buffon, Condillac, d’Alembert, Lavoisier, and such politicians as Malesherbes, Talleyrand, Madame Roland, Mirabeau, just to name a few.

Twenty years into her marriage, her husband died, and in 1776, she and Jérôme de Lalande opened the ‘Loge des Neuf Sœurs’, a masonic lodge that was affiliated to the Grand Orient of France. Freemasonry was incontestably one of the factors of the great changes that were taking place in the west. It was where new ideas were expressed, and from where men influenced the course of events. Of course, Benjamin frequented that French lodge from the very start. Two years later, in 1778, he was initiated as a member, and, in 1779, he was made Worshipful Master. A few weeks before his death, Voltaire was initiated as a member, and Benjamin was greatly impressed with the man. They became good friends, and when asked by Benjamin, he even gave his blessings to his grandson. Needless to say, the lodge was an excellent way for Benjamin to meet great men who had influence in the highest levels of society.

But Benjamin was also a ladies’ man. His wife had died in 1774, and in spite of his age, while in France, he was treated like a rock star, and he couldn’t help being a flirt. One lady whom he considered his equal was Mme Helvetius, and he may have even proposed to her. One thing for sure, he wanted to share her bed. He called her Notre Dame, and in one of his notes to her, he writes: ‘if Notre Dame is pleased to spend her days with Franklin, he would be just as pleased to spend his nights with her; and since he has already given her so many of his days, although he has so few left to give, she seems ungrateful in never giving him one of her nights’.

Franklin frequented the upper classes and the aristocrats, for they were the ones he had to convince in order for them to convince the king. The salon of Mme Helvetius and the Lodge of the Nine Sisters served his purpose well, but that was not his only activity. He was in constant communication with Robert Morris in Philadelphia, because, as arranged by Mayer, he depended on his financial help. There was a four-way communication between Mayer, David Schiff, Robert Morris and Benjamin because arms, clothing and war material shipments to America had to be organized as well. Because Benjamin had so many important contacts in Paris, and because he was such a hit with the French, he had been able to convince Minister Vergennes to replace the outdated arms in France’s numerous arsenals and send them to America. The arms then found their way to Rotterdam from where David shipped them to America through St. Eustatius. So, from 1776 to 1778 ever more arms and powder made their way to America.

Back in NYC, in 1776, after being arrested by the English for helping the Sons of Freedom, Haym had started interpreting for the Hessians. That’s when he befriended Colonel Johann Rall, a Hessian, and by pulling all the right strings, he managed to have him command the Hessian troops sent to hold the Trenton position opposite Philadelphia. Haym had explained to Rall that Philadelphia was a community made up of Germans who had come from the Frankfurt region just like them, and if they were to defect, not only would they feel at home but they would be given large parcels of land and enough money to start a new life. The Trenton Hessian soldier pickup was a total success, more than 900 Hessians crossed the Delaware with Washington’s help. More importantly, it was construed as a major American victory over the English, and it gave quite a boost to American morale.

Later, on July 12th, 1778, when the French Ambassador sailed up the Delaware, Mayer had been forewarned and had sent word to Haym who was in NYC. Haym escaped without too much difficulty, and though the English sentenced him to death in absentia, he arrived safely in Philadelphia ahead of the French Ambassador.

After settling in the counting house run by Bernard Gratz, Washington backed Haym’s candidacy as broker of the French aid package. But the French Ambassador was already looking for Haym, thanks to the recommendations of Benjamin in Paris. That’s how, with Benjamin’s help and the support of influential members of the Continental Congress, Haym was chosen by the anti-Semite French to be their treasurer. Haym was not only named broker to the French Consul, but also Treasurer of the French Army, and Fiscal Agent of the French Minister to the United States. Most important of all, some 500 tons of gold were added to the bullion already in his Philadelphia vault.

However, working within Congress was another matter. Both Haym and Robert worked for Mayer, but Robert Morris was the one chosen to become a member of Congress because he was a goy. Not only that, but he was, as far as the colonials were concerned, a rich merchant who had supplied them arms and ammunitions since 1774. David had sent on the arm shipments to America as directed by Mayer, but it was Morris’ arms importing company that had fronted the operations. Congress and the militias had gotten arms and powder, and they had been too grateful to ask questions. Mayer had total confidence in Robert Morris, and since Americans, like Europeans, were not yet ready to accept Jews in the inner sanctum of political leadership, Robert worked inside Congress, and Haym outside. Mayer was quite satisfied with this arrangement.

18-1st CONTINENTAL CONGRESS

When he arrived in St. Eustatius, Haym introduced himself to Heyliger with a letter of introduction from Mayer. Heyliger said he was most happy to do more to help the American cause. In order to devote all his time to his new occupation and avoid any conflicts of interest, Abraham suggested it would be best if he handed over the post of Commander to his son-in-law at the first opportunity. Haym left a considerable amount of silver specie with him to make absolutely sure any bills of exchange that came his way in St. Eustatius would be honored, although that was quite unlikely. Mayer’s bills were so widely accepted that merchants simply signed them over to second and third parties who would eventually redeem them in the 13 Colonies or in Europe.

When he arrived in Boston harbor, Haym sent a runner to the home of Moses Hayes, a prominent member of the Sephardi community who ran Mayer’s local counting house. Moses had presold most of the cargo and the balance of wine and denim was promised to waiting buyers in New York and Philadelphia.

Haym acquainted Hayes with his plan to help the patriots achieve independence, and asked him for the name of a goy politician won over to the cause, preferably one who was very ambitious. Once he was told what kind of man Mayer was looking for, Hayes mentioned one John Adams, a very motivated lawyer who was willing to espouse any cause for a price. Since he and Adams were practically neighbors, Hayes added he could arrange a meeting at Haym’s convenience.

The next day, Haym was sitting in front of John Adams telling him of his plans to finance a meeting of the patriots in Philadelphia in September. He asked him if he would be interested in attending, and if he would be willing to recruit five members from each of the New England colonies which included Connecticut, Rhode Island, New Hampshire and Massachusetts. Haym told him the 13 Colonies were making him very rich, and the least he could do was finance a meeting to help the colonials gain their independence. When Adams realized how much money was involved, and seeing what was in it for him, he offered to leave everything he was doing and give the matter his full attention, saying the welfare of the colonies was what mattered most. Haym added that Hayes was to take care of expenses and compensation for the men chosen by Adams, and to show how serious he was, he handed him £300 in silver, a small fortune in badly needed specie. Adams was thrilled to be chosen, and the two men shook hands.

Haym sailed on to New York City with the remaining merchandise and the many chests of pennies to be stored in his vault. Once the presold merchandise was unloaded and the specie deposited in a safe place, the empty ship sailed back to Boston to pick up a rum shipment for David in Rotterdam. Haym then went to meet with John Jay who was flattered to be chosen to recruit the New York delegates. Haym told him he would get all the required funding and gave him an advance of £300 in silver like he had done with John Adams.

The next morning, Haym crossed the Hudson River and took a stage coach to Philadelphia. Mayer’s counting house run by Bernard Gratz was doing almost as well as the one in NYC. Before leaving for Williamsburg, Robert Morris assured Haym that he would be very happy to recruit the representatives for the Mid-Atlantic colonies. It was his way of saying that he was grateful for everything that Mayer was doing for him and the Colonies. Haym then asked Bernard to build or buy the best meeting hall possible along with all the necessary housing for the representatives of the 13 Colonies, estimated to be around sixty members in all, and again Morris volunteered to help. Bernard’s superb mansion could accommodate many delegates, but since he was a Jew, it was best to have Morris, a goy, organize the housing arrangements.

He spent the night in Wilmington, and the next day he arrived early at Elk River from where he sailed to Williamsburg on the other side of Chesapeake Bay. The winds were favorable and he reached Williamsburg by nightfall. He had written ahead to Michael Gratz who was waiting for him. Michael showed Haym to his room where he freshened up before sitting down to a very welcome meal.

Haym made plans to meet with Patrick Henry and George Washington separately. Michael told him he had met Patrick Henry on several occasions and had had a good rapport with him. He didn’t think Henry would mind coming to his home, the home of a Jew. Since they would need someone like Henry to recruit delegates in the southern colonies, he thought it best to first invite him and see if he was truly won over to the cause. The next step would be to meet with George Washington. If all went well, he could then have a meeting that would include Haym, Michael, Patrick and George. A meal washed down with fine Burgundy wine brought along for the occasion, and the promise of unlimited funding, would certainly be helpful in forging a solid bond.

Patrick accepted Haym’s invitation and arrived at Michael’s mansion the following evening. It was quite obvious this sharp-witted individual was distraught with the way the English Parliament was behaving. As a matter of fact, since the Boston Massacre, all he could think about was finding a way to have the colonies meet and devise a plan to achieve independence. It was precisely what Haym wanted to hear, agreeing with Patrick that it was the best thing for trade, and necessarily, for the people. Haym was quick to add he was a rich merchant profiting from trade with the colonies and it was to his great advantage to have representatives from the colonies meet and form some kind of government. What the English Parliament allowed or didn’t allow to go in or out of the colonies and the abusive exchange rate they forced upon the merchants was insane. Free and just trade had to be the colonies’ main goal, and credit had to flow if America was to thrive.

Haym continued by saying he was willing to finance such a meeting and that he had already recruited John Adams in Boston, John Jay in New York, and that Robert Morris had volunteered to do the same out of Philadelphia. If Patrick agreed to recruit representatives from Georgia, South and North Carolina and Virginia for a September meeting in Philadelphia, Haym was willing to give him unlimited funding through Michael Gratz. He told him Michael ran his counting house in Williamsburg and was authorized to finance the meeting. He went on to say, if Patrick accepted, he would get all the necessary funding to give him the necessary status and power in order to get the job done. If Patrick needed to expand his mansion in order to accommodate the American leaders when he met with them, Mayer was more than willing to finance such an undertaking. Giving the impression of authority and power was important. Haym added he was quite impressed with Patrick’s initiative to have George Mason draft a complaint intended for the English Government, and that it would be a great idea to present such a document in Philadelphia when the representatives met. Patrick answered he also had a young prodigy working for him by the name of Thomas Jefferson, and together, George and Thomas were bound to come up with an impressive document. Patrick shook Haym’s hand and promised to get the job done. Since Haym was fulfilling his every wish, and since there were no conditions attached, Patrick was indeed motivated.

When George Washington came to meet Haym in Williamsburg a few days later, Haym acquainted him with the offer he had already made Patrick Henry, but added he had something else in mind for him. Saying he was quite impressed with George’s natural leadership qualities, he added he was not only willing to finance his military career as head of the revolutionary army if it came down to that, but also his political career which, if all went well, would likely include his election as head of the new government. In anticipation of the meeting, and in order to make sure he was chosen as Commander-in-Chief, he was to offer to personally finance the confederate army and forego his own salary. He would submit his expense account to Congress after the war was won. Haym would give him unlimited funding and make sure George received everything he needed. Haym was doing it for free trade. What was good for the colonials was good for him.

Since many prestigious residences would be needed to house out-of-state leaders and hold meetings, Haym was allowing as much credit as needed to have them built. If George wanted to expand and renovate his mansion, all he had to do was ask Michael. As a matter of fact, George could immediately hire an architect, and if he wanted, he could even start ordering materials from England through Michael. With the help of his people in Rotterdam and London, building materials and furnishings could easily be ordered and shipped to him in Virginia.

This offer was beyond George’s wildest dreams, but keeping his excitement in check, he simply told Haym he accepted his offer, promising if he ever became leader of the new government, everybody would know where the funding came from. He couldn’t help asking, however, if Haym had a strategy regarding what had to be done next. Haym simply repeated he wanted the Philadelphia meeting to be a success, and was depending on him, Patrick Henry, and Robert Morris to make it happen. Michael and his brother Bernard would supply all the credit needed. Haym would study the maps of the colonies along with English troop and ship movement, and after consulting with General Von Estorff in Germany, he would make the general’s views known to George as soon as possible. Lastly, as the men shook hands, Haym told George that the most important thing he could do for now was make sure the wording of the resolves presently being drafted by George Mason and Thomas Jefferson reflected the mood of the representatives when they met in Philadelphia.

 

Post-scriptum

Carpenter’s Hall in Philadelphia was finished on time and the 1st Continental Congress met there from Sept. 5, 1774 to Oct. 26 1774. There were 56 delegates from 12 of the 13 colonies, Georgia being the exception. John Jay, John and Samuel Adams, Patrick Henry, George Washington were some of the more prominent participants. The Fairfax Resolves whose content is briefly referred to below were used as a template during the meeting.

 

Synopsis of Fairfax Resolves

  1. Resolved that our ancestors, when they left their native land and settled in America, brought with them the form of government of the country they came from and were entitled to all its privileges, immunities and advantages which ought to be as fully enjoyed as if we had still continued within the Realm of England.
  2. Resolved that the most important and valuable part of the British Constitution, upon which its very existence depends, is the fundamental right of the people not to be governed by laws to which they have not given their consent.
  3. Resolved that the inhabitants of the American Colonies are not represented in the British Parliament, and that the legislative power can only be exercised by its own Provincial Assemblies or Parliaments, and that the Colonies should be allowed to trade with countries other than England
  4. Resolved that it is the duty of the Colonies to proportionally contribute to the defense of the British Empire as long as they are treated on an equal footing
  5. Resolved that to extort money from the Colonies without the consent of the people is not only diametrically contrary to the first principles of the Constitution, but is totally incompatible with the privileges of a free people.
  6. Resolved that Taxation and Representation are in their nature inseparable.
  7. Resolved that the powers over the people of America now claimed by the British House of Commons are contrary to the interests of the colonies and are most grievous and intolerable forms of tyranny and oppression.

16-WINE AND DENIM

By the end of June, 1773, David in Rotterdam had received and sold several shipments of tobacco and realized a bigger return than anticipated, Jean-Baptiste Willermoz and François Johannot and their wives had come back from the south of France with interesting information along with several bottles of Burgundy wine and several meters of ‘de Nîmes’ cloth.

After debriefing Jean and François in his Farhgasse office, Mayer decided to give Gretel, his one and only confident, a full account of their trip. They sat down at the kitchen table, and Mayer started relating the great news Jean-Baptiste Willermoz and François Johannot were bringing back from France.

He first showed her a sample of the cloth. It had one weave of blue thread crossed with a weave of white thread, and the double-weave not only made for an interesting design, but gave it extra durability. Gretel thought the indigo colored cloth was beyond belief and wondered if poor people could afford it.

Mayer answered that it would sell for the same price as Indian or English cotton and last many times longer, so people would flock to buy it. And before Gretel had a chance to make a comment, Mayer reached for a bottle of burgundy wine, one of the many samples brought back by François. He picked up a funny curly piece of metal, drove it into the cork with a screwing motion and pulled the cork out of the bottle neck. He took two glasses, half-filled them, and they drank to their growing family.

Gretel thought the wine was too good to be true, but her mouth dropped upon learning how much money the wine and cloth was going to bring in. Mayer started by explaining that Bouchard in Beaune was to receive a letter of exchange in the amount of £2500, or 1 shilling per bottle of wine once delivered in Rotterdam where David would presell it for 1/6 per bottle. David would give the new willing owners a letter of exchange guaranteeing them 3 shillings per bottle if delivered in New York where Haym would presell it for 4 shillings per bottle. 250000 bottles, or half a shipload, would thus generate a profit of £6000 in Rotterdam and another £12500 in New York City.

With regards to cloth, Dollfus was to receive a letter of exchange in the amount of £12000, or £10 per bolt of denim once delivered in Rotterdam where David would presell it for £12 per bolt. David would then give the new willing owners a letter of exchange guaranteeing them £15 per bolt if delivered in America where Haym would presell it for £17 per bolt. 6000 bolts of cotton, or half a shipload, would generate a profit of £12000 in Rotterdam and another £12000 in New York.

He concludes by repeating that since a work outfit made with denim cloth in America will cost less than one made with English or Indian cotton but last ten times longer, everybody will be fighting to buy it. Likewise, since the best wine in the world will only keep getting better in a bottle, all the bourgeois in America and England will want to fill their cellars with it. He then adds that though the profits appear to be huge, the price for these superb new products is well below what people will be willing to pay.

To help Gretel get over her choc, he starts relating the adventures of François’ party to France. They had started off by taking a river coach to Mainz. After spending a delightful night in a well-appointed inn, they set off the next day for Basel. River coaches were much more comfortable and a faster means of transportation, but only when going downriver, the rest of the time it was best to travel by stage coach. It took them five days by stage coach to reach Basel where friends were waiting for them.

After a day’s rest, they travelled by stage coach to Montbeliard , and from there they continued on by river coach to Chalon-sur-Saone, a town south of Beaune. Having made prior arrangements, a local winemaker whom they hadn’t seen in years welcomed them in his beautiful country estate. The next day, their host introduced Jean-Baptiste and François to Joseph Bouchard, a wine merchant from Beaune. They were told the Givors factory on the outskirts of Lyon was making glass using ovens fired by ground coal. And because glass made with coal as a fuel instead of charcoal was much stronger, and because the glassblowers had started using handheld molds, they now made less fragile and more uniformly shaped bottles more quickly. Because the bottle necks were thickened and had a standard diameter, it was now possible to use a one-size-fits-all cork stopper. Bouchard told them there was plenty of wine available, but getting fifty thousand glass bottles at a time might be a problem. He told them it was best to check with Michel Robichon who was the glassmaker in Givors. As for the corks, the cork slabs could be bought in quantity in Arles, transported to Beaune where they could be suitably shaped. All in all, he thought it was quite a feasible operation, and it would be no problem to fill the bottles with the best wine of the region and cork the bottles in a matter of days. Bouchard was already experimenting with the bottles, and he promised to give them wine samples on their return trip home. If Givors supplied bottles in sufficient quantity and at the expected price, he stated he could get the wine to Rotterdam via Basel for around nine pennies a bottle.

Jean-Baptiste and François were quite excited and were anxious to go to Givors to visit the glass factory and interview Michel Robichon, the owner. They left their wives with family in Lyon and continued on to Givors the following day when they reached the glass factory, they acquainted Robichon with Mayer’s idea of financing regular shipments of bottled wine using the services of Joseph Bouchard in Beaune. They told Michel they had talked to Joseph, and that his only concern was having enough bottles. Naturally, they wanted to see if his factory could supply lots of fifty thousand bottles on an ongoing basis.

Jean-Baptiste and François were happy to hear Michel say that he had just put in a second oven and that a third was on the way. Since one oven supplied enough glass to accommodate four glass masters, and since each master could turn out five hundred bottles a day, it meant that the production would soon be six thousand bottles a day, thirty-six thousand a week or some two million a year.

Michel added one cautionary note. The factory was presently getting its high quality ground coal from Rive-de-Gier, a mine situated fifteen kilometers from Givors. The canal that was meant to transport the coal by barge was not yet completed, and the mine owners had to use mules to bring the coal to Givors. They had some twelve hundred mules in all, with two trains of four hundred mules making a daily turnaround while the remainder rested. With each mule carrying eighty kilograms of coal, it averaged out to a daily supply of around sixty tons. But since most of the coal was destined for the south of France, if he was to add extra ovens, he might not be able to get enough coal. However, he would put a little pressure on the coal mine owners by reminding them that his factory was operating under the Royal Seal, and was to be supplied in priority. But that was down the road. For now, there was more than enough coal to fire up the second oven, and it would take less than two weeks to produce the fifty thousand bottles. He could have molds made with logo indentations in order to identify the wine, and before shipping the bottles to Joseph Bouchard in Chalon-sur-Saone, he would package them in fifty bottle capacity wicker baskets.

Jean-Baptiste and François were happy and wasted no time getting back to Lyon where their wives were waiting. They spent a few days visiting family and friends, but they couldn’t wait to carry on downriver to Arles by water coach. It took them only three days to reach Arles under very comfortable conditions, and from there, it was a very short day trip by land coach to Nîmes where they had written ahead to Jean André, the owner of the cloth factory in Genoa, Italy.

When they finally met with Jean, Jean-Baptiste and François were pleasantly surprised to hear that he had every intention of going ahead with the production of the double-weave indigo cloth. They couldn’t believe it when Jean added that he was planning to move the production of this very promising cloth from Genoa to Mulhouse which was not far from Basel on the Rhine. It was a Huguenot city-state bordering France and the thousands of jobs being created were needed to help the growing economy. It didn’t cost much more to bring the raw cotton and indigo from the Americas up the Rhone instead of to Genoa, and because one of the two rivers that ran through Mulhouse had soft water and was perfect for dyeing cloth, the savings would more than offset the added transportation cost.

There were already fifteen cotton factories and more than two thousand cotton workers in Mulhouse, and with the advent of the flying shuttle, the spinning carding frame powered by a water wheel, two recent inventions developed in England, the cost of producing cotton cloth had dropped while the quality and production had increased dramatically. With the added planned production, Mulhouse would become the biggest cotton manufacturing center in continental Europe, and because the city was independent of France, they weren’t affected by the embargo imposed by France on the production of cotton fabrics. Understandably, since the demand for cotton cloth was exploding, the fabric would no doubt attract high prices for years to come.

Jean told them that his cotton mills would be operational within a few months. He had already bought an existing factory on the Mulhouse riverfront, and the equipment being fabricated by local artisans was likely finished by now. Jean told them his director in Mulhouse would soon be able to deliver twelve hundred bolts of the finished indigo double-weave product to Basel on a regular basis for around £10 per bolt. They confirmed that with Jean-Henri Dollfus, the man running the Mulhouse factory, on their way back to Frankfurt. Dollfus had already received several barges of raw cotton from the French West Indies along with indigo.

Before Gretel had a chance to give vent to her unbelief, Mayer sat down at his desk to write to Joseph Bouchard in Beaune and Jean André in Nîmes telling them he was willing to buy as much product as possible at the agreed price. There was no time to lose for the letters had to be translated by François before being sent on. He was telling Joseph Bouchard to deliver all the grand cru Burgundy wine he could bottle. Mayer would give him a letter of exchange redeemable upon delivery in Rotterdam. He then addressed a letter to Jean André asking him if he would agree to the same financial conditions. Just like with the wine, Mayer would buy all the cloth that could be delivered to David in Rotterdam where the letter of exchange would be redeemed.

Soon, it would be possible to redeem Mayer’s bills of exchange, and even use them as currency, in Frankfurt, Rotterdam and the 13 Colonies, not including the counting houses that would soon open in London and Basel. He had contacted Moses Haim Montefiore in Rotterdam, the friend who had helped David Schiff get settled, asking him if he was interested in running a counting house in London. Moses had replied by return mail that he had been thinking of settling permanently in London, and running a counting house for Mayer in that city was more than he could have hoped for.

By the end of 1773, David was receiving tobacco on a regular basis and he had dispatched the first shipments of Burgundy wine and denim cloth. In both Rotterdam and New York, everything always presold at a price better than anticipated, and Mayer’s counting houses were becoming financial institutions of note. He was now ready for his next venture.

He wrote to Haym asking him to come to Frankfurt as soon as possible. Haym was to first go to Williamsburg in Virginia and introduce himself to as many members of the House of Burgesses as possible in order to see what the political climate was in that very important southern colony. Virginia was the most democratic colony, and its leaders had always been stalwart supporters of the Crown. Nonetheless, die-hard loyalists had started being upset with the English Parliament just like in the colonies up north, and Mayer wanted to confirm that. Haym was to identify any leader who stood out in his opposition to the Crown, preferably someone who was imposing, ambitious and vain.

The very powerful Bank of England, by way of the English Parliament, was treating the 13 Colonies as a parent would a child. Although the pound was the official currency, the Bank of England supplied very little sterling in order to facilitate trade. The colonials were reduced to using tobacco, wampum and the like when they couldn’t get their hands on Spanish dollars. The lack of credit, the unjust rate of exchange between the Spanish dollar and the Pound, the lack of representation in decision making, and the unjust taxes forced upon the colonials by the Mother Country was making for an explosive situation.

Mayer was honest and had enough specie to redeem all the paper he was issuing, and because his counting houses on both sides of the Atlantic used the same conversion rates, his paper was in high demand. In all his counting houses one pound was worth 1 oz. of silver or 1 Piece of Eight, and 1oz of gold was worth 15 oz. of silver. And since the British insisted on a colonial conversion rate of 4 Pieces of Eight to the Pound, it gave Mayer’s counting houses a serious edge over the English. Necessarily, all bills originating from the colonies were expressed in Spanish Dollars, whereas all merchandise coming from Rotterdam was valued in Pounds, as this greatly advantaged the American colonials. Since Mayer’s counting houses only accepted gold and silver as payment, and since Haym was instructed to never exchange Dollars for Pounds, the great disparity in the English exchange rate didn’t affect his counting house.

Mayer’s counting houses were gaining in international status, and he had more than he needed to finance a meeting of the 13 Colonies. The colonies’ representatives would not question the help of Haym Salomon, for it was only natural for a rich friend who profited so much from colonial trade to help out. The Americans would surely gain their independence, and they would look upon Mayer’s counting house as an honest, dependable source of credit, and Mayer would take control of the 13 Colonies’ monetary system just like the Bank of England bankers had done with that of England a century before, but he would do it anonymously through Haym Salomon and Robert Morris.

15-INTERNATIONAL TRADE

Mayer didn’t want to scare Gretel by telling her about the huge tract of land he had recently bought on the outskirts of Frankfurt. It was a parcel of around two hundred acres of forest and marshland to the west of the city, well beyond its walls. Now that Haym was more or less confirming what he already knew regarding America, it was obvious he would need more office space. As soon as the landscaping allowed it, he would go ahead with the building of a grandiose manor that would serve as his headquarters. The marshland would be transformed into a vast botanical garden, and he already had a name for the palatial structure to be built at the north end facing south. It would be called Green Castle. Officially, it would be Peter Heinrich von Bethmann’s residence, but unofficially, it’s where Peter would run Mayer’s banking operations, and where Mayer would keep his vaults and accommodate out-of-town business associates and friends. From the terrace of Green Castle there would be a panoramic view of huge stretches of lawn, trees, ponds and many exotic plants and animals, things that were completely foreign to the Judengasse ghetto. It would be a peaceful place where Gretel could go and enjoy the fresh air and the luscious green beauty with the children. He knew Gretel would find this private green paradise hard to resist once she was introduced to it. Above all, this property was subject to the authority of Prince Wilhelm, not that of the Frankfurt Council.

Mayer sat down and wrote Haym that he was to go ahead with the tobacco shipment. He told him he would confirm it with David who would then get the necessary warehouses built in Rotterdam. Haym was to get the best tobacco available, for high quality products attracted higher prices and could be sold more easily.

As for the wine and denim, he told him he was acquainted with two Frenchmen in Frankfurt who were in a position to help. Jean-Baptiste Willermoz had a silk factory in Lyon, France, but spent a lot of time in Frankfurt where another Frenchman, François Johannot, operated a silk factory as well. The high-end silk business wasn’t doing so well and they would certainly welcome a chance to get involved in a more lucrative business. He was certain that Jean-Baptiste, François, and their wives would welcome a chance to have a first class, fully financed voyage to the south of France while inquiring about the availability of bottled wine and denim cloth. The offer to leave winter behind them, visit family and friends in Lyon, and bask in the Mediterranean sun was a powerful enticement.

With the help of Jean-Baptiste and François he was certain he would soon be financing wine and denim shipments to Rotterdam, London and NYC. This would work out extremely well, for wine and denim shipments would go down the Rhine by barge to Rotterdam, and the same barges would come back up the Rhine with arms and military supplies for Prince William along with pre-ordered manufactured goods to cities all along the way. In anticipation, he was arranging to have more of the Roman-type barges constructed in Hanau. So far, his barges on the Rhine were proving to be quite a success, and because they all flew the Prince’s colours, they hadn’t been harassed by the bandit lords and forced to pay tolls. He intended to continue the same modus operandi with the wine and denim shipments.

He finished his letter to Haym, and took it to the Thurn and Taxis office for delivery to America. He came back in time to have supper with Gretel and his precious little Yochana. He told Gretel he was planning to go to Rotterdam to acquaint David with the latest developments, and that he would be gone at most three weeks. When prompted by Gretel, he proceeded to tell her what was on his mind.

He had already told her how the Sephardi Jews had joined up with the Huguenots and created the Bank of England in 1694. He explained that he saw an opportunity to do the same in America. The Americans needed credit, and since the Bank of England bankers wasn’t providing it, he would. Everybody trusted his bills of exchange, and they would soon be widely accepted on both sides of the Atlantic. If he helped the Americans win their independence from England, his bank would then be automatically recognized as the official bank of America when the time came.

For now, he was planning to finance shipments of high quality products in both directions across the Atlantic. When merchants became convinced that his bills could be redeemed for specie and on demand on both sides of the Atlantic, and that his exchange rates for Thalers and Pounds were fixed and fair, he was sure that instead of going through the trouble and cost of redeeming them they would just sign them over to third, fourth, and fifth parties. On the other hand, David and Haym would be instructed to only accept specie for all sales. Specie would accumulate with each shipment, and both counting houses could then issue more bills of exchange. As he waited for the sale of the first shipment of tobacco that would soon be concluded in Rotterdam, he was making plans to send Jean-Baptiste and François to France to look into the wine and denim possibilities.

As Gretel grasped the huge sums of money her husband would be making, she worried about her family and told him this wasn’t what she had expected when she married him. Mayer reassured her. He had no intention of showing his wealth and letting everybody know how rich he was. He told her that his name would never be officially connected to anything he did because he didn’t want to stir up feelings of envy and hatred. He told her he was not interested in flaunting his wealth, and the only thing that mattered was for her to be proud of him.

He explained how he planned to finance the Americans in their fight for independence, and once achieved, how he would create a bank for them without their ever knowing who he was. His financial operations would be international in nature, and that would ensure his success and his anonymity. His counting houses on both sides of the Atlantic would be run by people who don’t officially answer to him, like Haym and David. Because each counting house had to interact with the others, they would be independent, yet firmly part of the whole. Notwithstanding the fact he trusted his agents with his life, the counting houses would be accountable to each other and to Mayer without his ever having to be present.

Mayer intended to surround himself with Ashkenazim who would become an extended family network, and he would use goys only when he had to. Haym may have been a Sephardi, but he was like a brother. He respected and trusted David and Haym, and by giving them everything they could possibly want, he was sure of their respect and loyalty, and this allowed Mayer to work in total anonymity. Maintaining anonymity, making astounding amounts of money and being magnanimous and honest in all transactions at all times was the key for lasting success.

Gretel loved this man, and as he picked up Yochana and started singing from the Torah, she was the happiest woman in the world. She didn’t want to lose that. But she also knew that if Mayer didn’t follow his dream, he would cease to be the man he was, and she could not bear that.

The next morning, before leaving to meet with Jean-Baptiste and François, Mayer told her how important that meeting was. French wine was the best in the world, and there was talk that the Burgundy wine could be bottled in uniform-sized bottles. The other product had to do with cloth. The Huguenots, in wanting to have a country of their own, had emigrated to the Prince-Bishopric of Basel where they were weaving cotton cloth which was in great demand, but which was forbidden in France proper. They grew cotton in the Caribbean islands and were shipping it up the Rhone-Saone-Doubs river system to Montbéliard and then by land to Mulhouse, the industrial center near Basel.

Mayer wanted Jean-Baptiste and François to look into those two products. If it turned out as he expected, he would consult with Haym, authorize the shipments, and then help the Americans gain their independence. He would start by financing a meeting of the thirteen colonies with the aim of creating some kind of government. He would find and finance leaders who were opposed to English rule, and since Virginia was the most sophisticated politically, that’s where he planned to concentrate his efforts. But for now, he had to accumulate as much bullion and specie as he could, and the only way to do that was to be a businessman.

14-LETTER FROM NYC 1772

Dear Mayer,

I’m writing from New York City. If I didn’t write sooner, it’s because the sea voyage really weakened me, and because I wanted to have a better understanding of the city before putting pen to paper.

Let me start by saying that I arrived in Rotterdam as planned after an uneventful five-day coach ride. Since you had sent the five chests of pennies ahead with Thurn and Taxis, I didn’t have anything to worry about, and it allowed me to better enjoy the company of the people I met in the relay inns. Upon reaching Rotterdam, I went directly to David and Hannah’s place, and it was a moment of great conviviality. I’d missed them, they’d missed me, and I wanted to know everything about them, and they wanted to know everything about me. I can only say that I’m very impressed with what they’ve done. They have a beautiful home, the counting house is well-appointed, and they seem to have contacted everyone worth knowing with Montefiore’s help, a truly great gentleman. There’s no doubt in my mind that your decision to send David to Rotterdam was the right one, and I can only hope to do as well for you in New York

I left Rotterdam, and I crossed the channel to London where I waited for a ship that took on passengers for New York. I soon found what I was looking for, and I booked passage on a good looking ship about to lift anchor. The ocean crossing took more than three months and was very unpleasant. The captain told us it was the worst weather he’d seen in years. I spent a lot of time turning green and wondering if life was worth living, and when it got too bad, I stayed in my hammock, and that, I’m sure, was what saved my life.

I did, however, have a few days of relief during which time I managed to get my hands on some moldy dry bread and barely drinkable water laced with rum, and having digested this doubtful ration, I was able to observe the world around me with some degree of lucidity. Most of the crew members were of the unrefined variety, but they were competent and helpful. There were several gentlemen who were going to the colonies to strike it rich, but my most interesting encounter was with a fellow named Ephraim Hart. He was especially interesting because he was returning to New York to resume his business activities, and he provided me with much information concerning the ins and outs of life in the colonies. When we arrived, I was in a pitiful state, and Ephraim was kind enough to introduce me to that fine landlady with the big house who has a fireplace in each bedroom, the same one I had fantasized about, remember? Well, it isn’t quite so, but it is a fine house. And Gretel, you’ll be happy to know she’s Ashkenazi and feeds me schmaltzy food, American style, and my ribs are no longer showing.

It’s been two weeks since I’ve arrived, and it’s the first day I feel disposed to write. On the day of my arrival, I managed to get my personal affairs transported to the boarding house, and you’ll be happy to know the five chests containing the thousand pounds of pennies are safe and sound. New York is a garrison town like Hanau, and there are hundreds of English soldiers and sailors roaming the wide avenues. Therefore, you need not worry about me or the money.

There are around fifteen thousand people living here. The city is located on the tip of an island that’s hidden behind a much bigger one that protects it completely from the onslaught of the ocean. The military installations are on the southern tip of the island, and the port facilities are built along the Hudson River on the west side and the East River on the other. One couldn’t dream of a more accessible and well-protected deep-sea water port.

The city is traversed north and south by a main artery called Broadway that runs from the Battery, the British military fortifications at the southern tip, to a fresh water reservoir called Collect Pond, and is approximately one mile long in English units. The city covers an area approximately one mile by one half mile. There are three main streets, Broad, William and Queen, running in a north-south direction. All streets run north-south and east-west, and are therefore perpendicular to each other. Most streets are pebbled and have paved walkways on either side, so one can easily access all parts of the city on foot or on horseback. Community life revolves around houses of worship, and there are many, including an imposing synagogue on Mill Street not far from Broad Street.

On my first outing, I walked to Collect Pond and I was encouraged to follow Boston Road north because of the beautiful colors of autumn. There’s a native tree called the maple that turns all colors this time of year, and it makes for a most spectacular sight. However, as I walked the streets, I couldn’t help but notice that people leave much of their waste on the roadways. They even leave dead horses to rot, and although pigs and wild animals act as scavengers, they only clean up so much. There are pigs, cows and many other animals roaming about because as the city expanded northward from Wall Street, many people used their large plots of land to grow food and raise animals.

Another downside is that one can smell human waste just about everywhere one goes. It would seem that the more responsible home owners dig a hole in the back of their house and build what is called an outhouse, and when the hole is filled, they cover it with earth, dig another hole and move the outhouse accordingly. Others use a simple pail toilet and empty it in out of the way places when people aren’t looking. There are many stories concerning chamber pots and how carelessly they’re emptied. For instance, I’m told it’s wise to hug the walls of buildings when walking in the city at night, for one never knows what can fall from the heavens.

Since there is so much waste being added to the soil, much of the water from the privately dug surface wells tastes bad and smells. A proud Philadelphian once wrote that here in New York ‘people drink a proportion of their own evacuations, as well as that of their horses, cows, pigs, dogs, cats, and other putrid liquids so plentifully dispensed.’ In all fairness, in comparing the two cities, that gentleman didn’t take in consideration the fact that Philadelphia has two rivers bringing it plenty of fresh drinking water, giving it a decided advantage. As for waste disposal in Philadelphia, I’m told it’s not much better than it is here. Its narrow unpaved streets crammed with poorly built houses are strewn with dejections, and the large deep wells dug in strategic parts of the city to accommodate waste produce a pervasive foul odor.

As a way of combating the scarcity of good drinking water, just about everybody, young and old, drinks beer. From the very first days of the colony, the Dutch drank beer and the English followed suite by bringing their brewers and beer making equipment with them. Everybody lives by an old European adage that says one doesn’t get sick if one drinks ale. However, many of the more fortunate English families tend to drink tea and buy their water from water peddlers who go door-to-door with horse drawn wagons laden with huge wooden casks. Obviously, these solutions are out of reach for the working poor. When all is said and done, as a community, New York doesn’t seem to consider having good drinking water to be a priority. When one compares the conditions here with the Judengasse ghetto and its superb sewers and abundant pristine drinking water, one can only wonder.

New York has a great middle class, composed chiefly of tradesmen and merchants. They are all housed in splendid residences, and most, including lawyers and doctors, have built their mansions on William, Broad and Queen Streets. On the other hand, the more humble folk who work for these prosperous citizens are parked along the East River in an area called the flats. It consists of an agglomeration of shacks and lean-to’s built on either side of a street appropriately called Water Street, and even though they can throw their waste directly into the East River, these poor people don’t have access to clean drinking water and don’t always have the pennies needed to buy beer. Their lot isn’t at all enviable.

The mansions and office buildings are built of stone or brick, and the Governor’s House, Trinity Church, St. Paul’s Church, Columbia College and the hospital are all within one block of Broadway. There’s a lot of wealth generated here irrespective of the sanitary conditions that I’ve described, and, not surprisingly, the population is said to double every ten years or so. For the time being, my boarding house located on Broad Street just south of Wall Street will serve me well, for I have access to all manner of businesses in the financial and port districts. It’ll be very easy to rent or buy office space, and you’ll be glad to know, that everything costs a fraction of what it does in Frankfurt. For instance, you can build a large two-story stone building on Broad Street for slightly more than five hundred pounds. According to Ephraim, you could have a five hundred ton capacity ocean-going vessel, all rigged and made of oak that can withstand thirty years of rot, built right here in New York for about the same price. This got me thinking as a banker, and I’m sure you’ll be interested in the suggestions I make further on in this letter.

First, let me tell you more about Philadelphia. It’s bigger than New York and it lies far up the Delaware River. A religious group from England called Quakers, a people known for their peaceful ways and tolerance, settled there. Since they were not tolerated in England, they’re not as loyal to the English crown as their counterparts in New York, and this could be worth remembering as the political storm builds over what is considered unfair taxation by the Mother Country. A large population of Swedes and many Germans from Frankfurt have settled there as well. However, because the tolerant Quakers are intolerant when it comes to language and want everybody to learn English, the three groups tend to stand apart.

The Delaware River being a more modest river than the Hudson, and Philadelphia being far upstream, the English have naturally built the bulk of their military facilities in New York City where they have ocean access to the whole coast. Another noteworthy fact is that Philadelphia though a long distance from New York City by sea is quite close by land. After crossing the Hudson River from New York City by ferry, it’s a mere two-day stagecoach ride to Philadelphia, and the service has been in operation for years. This situation is unique in the colonies, for all the other capitals remain quite isolated from each other.

Both the Delaware and Hudson River basins are very fertile and have been developed along the same pattern. Following the early Dutch East India Company guidelines, both valleys developed using the patroon system. The idea probably came from the Huguenot refugees who first settled in Rotterdam and later in New Rotterdam. In wanting to encourage settlements, the Dutch granted patroonships that spanned 16 miles in length on one side of the river, or 8 miles if spanning both sides. Later the plot sizes were cut in half in order to accommodate more Dutch Americans in good standing. The title of patroon derived from the word patron and meaning boss in French, grants powers and privileges just like they do to our princes in Europe. The patroon creates civil and criminal courts, appoints local officials, and holds land in perpetuity. In return, he is commissioned by the Governor to establish a settlement of at least fifty families within four years. As tenants working for the patroon, the settlers don’t pay public taxes for the first ten years, but they do compensate the patroon in money, goods, or services as agreed to by all parties. The patroon lives in a luxurious, well-built house of brick or stone, has a retinue of servants, large barns, orchards and gardens, and broad pasture lands. A patroonship has its own village infrastructure that includes a church which records births, baptisms, and marriages. On the one hand, the English encourage this system because the large tracts of land are very productive. On the other hand, they forbid the patroons from manufacturing goods for resale. As can be expected, the patroons disregard the interdiction, and continue to operate their foundries and other small industries that produce iron goods, furniture, and cloth. They then float all their excess production, along with all the furs they can get from the natives, downriver to New York where they sell the lot to the citizens and merchants totally disregarding the English interdictions.

The patroons and the merchants have developed a bartering system. They exchange local goods for manufactured goods coming from England, and keep track of how much one owes the other. No matter, there’s a real money problem here, and it lies in the fact there isn’t much silver specie to buy and sell the little things that ordinary people need in everyday life. When Ephraim told me that the Bank of England completely ignored the needs of colonials by refusing to inject silver specie in the colonies, I didn’t quite believe him, but it’s even worse than that. Not only do colonials have little sterling, but the English refuse to accept the plentiful Spanish dollars at par with the Pound, in spite of the fact they both contain the same amount of silver. By establishing an exchange rate of 4 to 1 in favor of the Pound, they are strangling the local economy. That combined with the fact that they ban the importation of non-English goods and discourage the locals from manufacturing their own very much foments ill feelings towards the Mother Country. This doesn’t make for a healthy political situation, and there’s even a growing dissident movement called Sons of Liberty that’s present throughout the colonies, especially in Boston where the English have massacred a number of their sympathizers last year. The Boston Massacre, as it’s decried on the street, has even enflamed the very loyalist Southern Colonies.

I’m sure I’ll have a lot more to say about these tensions at a future date, but for now, here are some of my views regarding facilitating trade with Europe. I’ve talked to Ephraim about this, and he thinks that our services are highly needed here in the colonies because although trade is increasing at a rapid rate, credit is hard to get, there’s very little specie and England is maintaining very unjust exchange rates in favor of the pound. But if we were disposed to finance a shipment of tobacco to Rotterdam, here’s how it could be done. I would ask a fellow I met, Robert Morris, or someone of his stature, to buy and deliver a load of tobacco consisting of a thousand hogsheads to Rotterdam. A hogshead contains a thousand pounds of tobacco worth a penny per pound and costs around £4. Morris would receive a bill of exchange reflecting a guaranteed price of, let’s say, five pennies per pound payable to him when David took possession of the tobacco in Rotterdam. Morris would then issue his own bill of exchange to the producer in Williamsburg payable when the tobacco is delivered in Rotterdam, and he would also give him written proof that taxes are paid and that the cargo is fully insured. In this scenario the seller in Williamsburg is guaranteed a full penny per pound for his tobacco payable in six months’ time with interest if required, and the merchant Robert Morris is guaranteed five pennies per pound when the shipment arrives in Rotterdam. David in Rotterdam will have by then sold the tobacco well below its market price if need be, let’s say, ten pennies per pound. In a worst case scenario, the producer gets £4000, the shipper makes £16000 (£20000 less £4000), minus expenses, and our counting house make £20000 (£40000 less £20000), minus expenses. All parties make a handsome profit, and since we have such a huge profit margin to play with, since tobacco is in such high demand, and since it would be sold ahead of time, it could be said there’s no risk at all.

If you wanted to finance shipments going from Rotterdam to New York or London, I have two suggestions, and they have to do with two French products. As you know, before I met you I had been travelling in France, and that’s when I became aware of them. I’m talking about two products the English in England, and especially in the colonies, aren’t familiar with. It has to do with a cloth from Nimes in the south, and an extraordinary wine from the Burgundy area further north.

If Burgundy wines became known, the demand for them would explode, I’m sure. The English are already very fond of Bordeaux clarets, and once they taste these delightful wines from Bourgogne, they’ll surely be overwhelmed. I personally tasted them and know how good they are. But here’s why I think they’re worth investigating further. I’ve heard that wines can now be shipped in bottles instead of casks, an innovation that not only guarantees the original quality of the wines, but allows them to age to their sublime potential before they reach the palates of connoisseurs. In a word, if we found a way to have Burgundy wine bottled, corked and packaged before sending a shipment of it to Rotterdam and London, it would surely become an overnight sensation, and its price would increase exponentially.

As for the cloth, it’s an ingeniously woven cotton fabric manufactured in Genoa, Italy. The cloth got its French name when a Huguenot silk manufacturer from Nîmes bought the Genoa business during the religious persecutions. The cloth had been used for making sails, but in wanting to expand the business, the Frenchman thought of selling the fabric for the making of work clothes. There was much talk about this white-blue ‘de Nîmes’ cloth when I was in Lyon. In spite of cotton being outlawed by the King, people kept asking for it, claiming it could outlast Indian cotton ten to one. Judging from that experience, I can say with assurance that if you financed a shipment of that fabric to America you would make a mindboggling profit. The cost of working clothes is so high and disproportionate to income in the Colonies that the demand for a cheap, attractive and tough cloth would surely be overwhelming.

Unfortunately, I have no way of looking into those products at this end. It would be necessary for someone to go to France and see about their availability. As far as I know, there are three key cities involved: Nîmes for the cloth and information regarding the bottle corks, Lyon for the bottles, and Beaune for the wine. The three cities are in a north-south axis along the Rhone-Saone River corridor. The corks, the bottles and the wine would come together in Beaune, and from there, the ‘de Nîmes’ cloth and the now-bottled wine would be transported over an excellent old Roman road that goes from Beaune to Basel on the Rhine, and from there the merchandise could be shipped down the Rhine River to Rotterdam or anywhere in between.

I hope you don’t think I’m being bold in making these suggestions. I’m just trying to give you useful information. There are many other possibilities, and I’m sure you’ll advise me. But I’m convinced that indigo, rum and tobacco from the Americas, Burgundy wine and ‘de Nîmes’ cloth from France, and colorful cotton fabrics from England are the sort of exotic merchandises that would generate extremely high profits.

There’s something else I have to tell you, and it has to do with a discovery that I’ll refer to as the Atlantic ‘stream’. Don’t fret if you’ve never heard of it, hardly anyone has. It’s an ocean phenomenon that’s been confirmed by a very ingenious fellow called Benjamin Franklin, a Philadelphian who has become the Colonies’ emissary to England. For some time now, merchants have been wondering why it takes longer to sail to New York than it does to the southern colonies even though they’re much farther, and this fellow Benjamin figured it out by paying attention to the New England whalers. The whalers kept saying that in order to catch more whales they followed what seemed to be a big river of warm water that flowed right through the Atlantic Ocean. This river was full of plankton, whale food for the uninitiated, and it flowed in an easterly direction. If they followed this river, they were sure to bring back all the whale oil their ships could hold.

Benjamin was paying attention, and on one of his trips to Europe, he got the captain to agree to zigzag his way across the ocean, thus going in and out of the alleged river of warm water. As he did so, he recorded water temperatures and latitudes, and the result was very convincing. He was able to chart this ‘stream’ of warm water and show that it flowed at a speed of around four knots. He published his findings in England, but since mighty English captains have nothing to learn from lowly colonial whalers, this discovery is still not being exploited by the English. But the fact remains, if one were to sail north or south of it on the westward leg, one could shorten the journey by as much as two weeks, and if one were to sail in it on the eastward leg, there would be much time gained as well. I thought you might find this information useful because I remember you telling me in your tongue-in-cheek way that having a good communications network and knowing things ahead of everybody else could be very profitable.

In closing, let me say that I intend to proceed with the rental of office space on Broad Street. I also took the liberty of having a small quantity of bills of exchange printed. I’m enclosing a sample for your perusal.

As I await your answer which will probably arrive in four or five months from now, I’ll get acquainted with merchants and find out what merchandises are the most profitable to finance. I’ll also make a point of going to Philadelphia and meet with a fellow called Bernard Kratz who’s trying hard to have a synagogue built over there. I’m sure I’ll find out everything there is to know about Philadelphia through him. As I await your reply, regardless of the financial activity I pursue, it won’t involve big sums. When I get your letter, if you’ve decided to go with tobacco, I’ll be ready. Needless to say, a four or five month correspondence delay doesn’t simplify matters, but once I know exactly how you want to proceed, things will get sorted out. Rest assured that I don’t see any major impediments at this end, at this time.

 

Regards,

 

Haym

13-HAYM SALOMON

America kept popping up in Mayer’s mind because he saw the New World as a place offering a fantastic banking opportunity. Mayer knew the English were having trouble over there because he had learned through General von Estorff that they were seriously thinking about sending Hessian soldiers to the colonies. It seemed the colonials weren’t happy because the mother country wasn’t providing enough credit while gauging them with taxes. He just had to find a way to get firsthand information on what was really going on over there.

Mayer automatically thought of Haym Salomon who was presently working for him in Hanau. He invited him to Judengasse for a good schmaltzy dinner because he wanted to know what his wife Gretel thought of him before asking him to go to America. Haym was an extraordinary young man whom Mayer had befriended in Hanover. He was a Sephardi whose family had fled Portugal and settled in Poland. He had left what family he had in Poland, traveled through Europe, and had learned eight languages. While helping Mayer in Hanau, he had learned all there was to know about how to buy and sell bills of exchange, and was getting ready to move on.

As they approached the north gate of Judengasse, they dismounted and left their horses at the blacksmith’s barn where Mayer kept his mounts and carriage. The guard at the gate recognized Mayer readily and saluted the two men as they entered. When they entered the ghetto, Haym couldn’t help but notice a crude drawing depicting Jews doing unnatural things to a sow, which included eating her excrement. Haym, a Sephardi, was taken aback, and he couldn’t help thinking that Ashkenazim must be spineless to let goys treat them that way.

Mayer knew what he was thinking, and told him there was no use spending energy fighting such vulgarities. Since the Frankfurt Council turned a blind eye on such abuses, and thereby encouraged the lowlifes that perpetrated hate crimes, wiping the wall clean would only make things worse. He continued by saying that the age of enlightenment would soon reach the Hesse region, and the walls would come down. Mayer preferred becoming rich and powerful, and taking down the walls stone by stone with his bare hands when the time came. One engaged in battle only when one was sure of victory.

As they went down Judengasse, Haym wondered how people could live in such crammed conditions, with so much noise, so little light, and so many strange odors, while Mayer saluted everybody, addressing most of them by name, inquiring about their families, and wishing them well.

They reached the tall narrow house where Mayer lived, and where his wife was waiting for them. They sat down for dinner, and Mayer started the conversation by asking Haym what he thought of America. Haym answered that there seemed to be a lot of fertile land to be had, that the winters were harsh, and that there was a well-established Sephardi community in New York City. He had also heard that it was a good place for an ambitious young man who wanted to get rich. Mayer replied that he was getting a good feeling for the colonies from the newspapers he read, but that he’d really like to have first-hand knowledge. Then he asked directly if Haym would be interested in going to America. Mayer was willing to pay his passage and set him up as a shipping broker in New York City. Haym was to open a New York counting house that would work with the Rotterdam one run by David. The Sephardi community in New York would surely welcome him, and since Haym was a smart good-looking young man, he would have no problem finding a wife.

Mayer continued by saying Haym could count on his unqualified support, and that he would have all the money he needed. In the first instance, all he had to do was keep Mayer informed. If everything turned out to be like Mayer expected, Haym would then come back to Frankfurt to be debriefed, and they’d both decide what to do next. If Haym disliked New York City to the point of wanting to come back to Europe early, Mayer would not hold a grudge. All he asked was for Haym to give him fair warning if he so decided.

When Haym asked when Mayer expected him to leave, Mayer answered that winter crossings were very rough, and that it would be wise to leave as soon as possible. He hoped that Haym didn’t suffer from seasickness, for a westward crossing could take anywhere from three to four months.

Haym said he was more worried about New York’s cold winter, and that all he hoped for was to find a rich widow who had a well-built boarding house with a fireplace in each room.