33-NATHAN IN THE CITY

When he arrived in England in 1798, other than wanting to do a good job and making his father proud, Nathan had a pressing personal matter. In 1795, on a trip to America with his father and brothers, they had stopped over in London, and he had been introduced to two families. Though Moses Elias Montefiore’s family was the one meant to welcome him when he moved to England, Nathan developed closer ties to the Levy-Barent Cohen family, for ever since 1795 when Nathan met Hannah Cohen, who was 12 at the time, that adorable little girl had been constantly on his mind.

Nathan started off by going undercover to Manchester. He had left the Judengasse ghetto as a penniless young man in 1798, and in the space of 8 years, he supposedly became the wealthiest man in the world. After achieving this feat dealing in the cloth business, he went to London. Other than wanting to see Hannah Cohen in London, being the man that he was, he must have been also champing at the bit to take over from the Goldsmids in the City. In 1806, he married Hannah Cohen, in 1808 Lionel was born, and in 1809 he moved to St. Swithin’s Lane in New Court. In 1810, after replacing the Goldsmid Brothers, he proceeded to create a bank in his own name, N M Rothschild & Sons, and overnight, he was recognized as the most powerful banker in the City, and hence, the world.

However, in taking over from the Goldsmid Bros., he had been helped by destiny. Benjamin Goldsmid committed suicide in 1808 just prior to Nathan’s moving to Swithin’s Lane. It was said that Benjamin had been depressed for some time. When his 19-year old son converted to Anglicanism, it had shaken him up, and when his wife and daughters followed suite, it appeared to do him in. At that time, he had expressed the thought that he was saddened by the thought of being the last Jew in his family, and no doubt, that had led him to be further depressed, enough to take his life. One morning, he was found in his bedroom dangling at the end of his bathrobe chord.

Abraham was troubled by his brother’s suicide, and doubly so because he was now alone in facing his firm’s business obligations. The brothers had bought £14,000,000 of Government Consoles, and in order to do so they had contracted a sizeable loan with the East India Company in Amsterdam. In 1810, for reasons unknown, the East India Company called in Abraham’s loan. That of course forced him to sell the Consoles at below market, thus making him suffer a huge loss that resulted in the insolvency of the firm. Abraham, a respected and honorable business man, used the whole of his personal assets to pay back what he owed, and that left him penniless. He committed suicide in 1810. A handgun was found near his body lying in a wooded area not far from his home.

In that same year, at age 33, Nathan opened his bank in the City. Miraculously, he was instantly recognized as the most powerful banker in the City. He probably had taken possession of his father’s gold in the Goldsmids coffers, almost half the gold ever produced in the world, some 5 thousand tons. Consequently, his bank immediately started fixing the daily price of gold for the whole world, and continues to do so to this day. If Nathan opened the bank in his own name it was because Mayer wanted to make sure Nathan’s bank didn’t have any official ties with himself. In doing so, all possible ties to a father who lived in a ghetto, to his bank, the First Bank of the United States, and to the gold accumulated during the French real estate scam, vanished. Nobody would ever know where all that power and gold enjoyed by Nathan came from. Anonymity was the key to success.

1810 was also a time to decide Napoleon’s fate. That year, Napoleon was tidying up his personal life. He had wanted a male heir, and since Josephine couldn’t give him one, he divorced her very solemnly and publicly. He married Marie-Louise of Austria later that year, and his son, the King of Rome, was born in 1811. Nathan thought that Napoleon had served his purpose. After shoring up Barras who put an end to the Terror, after serving as a catalyst for the demise of the French Navy, after politically transforming France into the centralist state that it is to this day, and after dismantling the Holy Roman Empire on both sides of the Rhine, Emperor Napoleon and his Imperial Army were no longer needed. However, there was one more thing Napoleon could do before he was given the coup de grace, he could go to Russia and force the Tsar to let private companies mine for gold in the Urals.

 

27-MANIFEST DESTINY

Mayer went to meet with Benjamin who had just arrived in Philadelphia. Though Mayer was much younger, they had become the best of friends, and they greeted each other enthusiastically. They had enjoyed the time spent together before Benjamin left for France, and again when they had met in Paris. They couldn’t wait to have a tête-à-tête which they arranged to have the day after the official welcoming ceremonies that were planned for Benjamin.

Benjamin’s german hadn’t improved much, but Mayer had since picked up an English word here and there, and they managed to communicate quite well. Mayer congratulated Benjamin on his masterful use of Morris Notes sent to him in Paris in order to pay for the French arms supplied by Vergennes and sent to Schiff in Rotterdam. Thanks to him, David had channelled vast quantities of surplus French arms to the Colonies. In other words, Mayer wanted to let Franklin know that without him, the victory at Yorktown, the founding of the Bank of North America and the about-to-be-signed Constitution would have been impossible.

Benjamin thanked him for his kind words, but he was more interested in knowing how Robert Morris had used the French gold to capitalize the Bank of North America. So, Mayer started by saying that the French gold was intact and had been used to back up the Morris notes. Morris had become the Bank of North America’s main shareholder, and the bank was on the verge of obtaining a 20-year charter from Congress. Mayer admitted that he now controlled America’s monetary system and that it was making him very rich but was quick to add that past a certain point being rich is of no consequence. The only thing that mattered was accumulating more gold bullion in order to create more credit and strengthen the burgeoning economy. There were, however, two main concerns. Getting more gold out of the ground was limited by current technology, and it was hard to maintain anonymity while controlling the monetary system. When Benjamin learned that Mayer had financed the creation of the recently-opened École des Mines in Paris with gold extraction in mind, he was in full of admiration of the man.

The subject then turned to France. Benjamin had much to say, and Mayer was all ears. Benjamin felt that France was a kettle ready to boil over. Masonic Lodges were mushrooming throughout France since the Congress of Wilhelmsbad, for members no longer had to swear on the Catholic bible in order to become freemasons. The change had opened the door to the Huguenots who were infiltrating France from England, Holland and Germany. Somebody was pushing for change in France, and that initiative seemed to be originating in the City, in London. Benjamin was quite sure the English bankers were out to destroy the Ancien Regime of France. People like Mirabeau and many others were already talking about France having a Constitutional Monarchy like that of England.

It seemed that Versailles was creating a problem. The King was completely isolated and surrounded by his aristocratic cronies in a lush setting while a starving Paris grumbled. Benjamin had personally felt this unrest in Paris in spite of the fact that Versailles was now occupied by Louis XVI and his young wife, a rather congenial couple.

The news was no surprise to Mayer. It was now his turn to give Benjamin some bad news concerning the Treaty of Alliance of 1778 that had unofficially made France America’s major trading partner. Since then, America’s economy had grown tremendously and now needed a stronger trading partner. Because of turmoil in France, Mayer thought that a formal trade agreement with England had to supersede the treaty that Benjamin had ratified in Paris in 1778. He knew that the French and the American citizenry would be very upset with what they would deem treachery, which, in fact, it was. Nonetheless, Mayer wondered if Benjamin could accept to work with him if such a trade agreement were signed. Mayer saw it as an urgent matter as well as a logical thing to do. America was mainly English-speaking and Protestant just like England, and the merchants in both countries were familiar with each other’s ways, for they had been trading with each other for a long time.

Benjamin was truly taken aback by this suggestion and remained quiet for the longest time. His natural inclination was to mistrust any man who dealt in betrayal. But because he knew Mayer was right in that they had no control over what was happening in France, and because he truly admired this man, he dismissed his gut reaction. He knew that Mayer felt the same way he did about France, and that he felt very bad about not honoring the Treaty of Alliance, even though it hadn’t been an official trade agreement. Reluctantly, he agreed with Mayer. Mayer added that he would make it up to France by always giving it top consideration in all future economic and cultural matters and would do everything in his power to give France a Constitutional Monarchy like that of England.

In the meantime, if Congress was to be receptive to the idea, Mayer told Benjamin his help was sorely needed. Although he was thinking of retirement, he urged him to accept the seat he was being offered in the Senate. With him sitting in the Senate, and Alexander Hamilton controlling finances under Morris’ leadership, they could easily steer the ship of state. It was the only way to successfully address the pressing matters facing the 13 Colonies. Getting the constitution signed, a President elected, permanent residences built for both the President and Congress, and a trade agreement signed with England would require all their attention.

So far, Hamilton had written newspaper articles that had led to the ratification of the Declaration of Independence by New York, and he was now in the process of drafting the constitution with Madison. With regards to the ceded lands by England, since the individual Colonies had claims on them, Mayer had asked Robert Morris to forgive their war debts on condition that they sign over their rights to Congress, and it seemed to be working. There wasn’t much doubt that all would accept, and in so doing, they would be accepting the authority of Congress. That in turn would open the door to their accepting a residence for both the President and Congress up the Potomac River, and thus, a federal state.

Because Mayer thought things were going well and in the right direction, he added that it was probably now time to start thinking about the territorial boundaries of this great nation in the making. After the signing of the Paris Treaty in 1763, when the French had repatriated their administration and military leaving America to the English, and the signing of the Paris Treaty of 1783, when the English had left the 13 Colonies to the Americans, it was now time to start thinking of expansion westward.

Mayer was thinking of a way to repay France for coming to America’s aid in 1778. America would buy its vast land possessions that stretched from New Orleans to Hudson Bay and to the west right up to and including the great prairies for a substantial amount of money. His bank would advance the money, and the loan would be added to the federal debt. For France, the windfall would be a compensation for aiding America in 1768, as well as for its loss regarding the upcoming trade agreement with England. Mayer would find a way to arrange a mindboggling deal that both France and Congress would be only too happy to agree to. Then, a huge buffer zone north of the 49th parallel could be created, and the USA would be free to expand westward in an orderly fashion along that parallel. Once the West was opened, the Spanish-Mexican problem to the south would be addressed. Congress would first help Mexico gain its independence from Spain, and down the road, offer to purchase the Mexican lands north of the Rio Grande. The Rio Grande would then become the southern boundary line. The American states west of the Mississippi would be incorporated as warranted by population growth, and the USA would become a coast-to-coast nation, with Canada to the north and Mexico to the south. Unlike Europe, the USA would be a coast-to-coast homogeneous country, with a mainly white, English-speaking, Protestant population. It was the ‘manifest destiny’ of the USA to become the greatest country the world had ever seen.

The Jew and the goy looked at each other in total agreement and embraced. In that instant, they took full measure of the situation, and the long silence that followed, steeped in humility and mutual respect, spoke volumes about what they had and would accomplish.

17-LETTER FROM NYC

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 two 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 Gutle, 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 humbler 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-tos 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 as 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 marketing 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 listening 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 supposed 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

12-GLORIOUS REVOLUTION

The word revolution is a banker’s term. It was used by the owners of the East India Company when they launched their first revolution, in England, in 1688. It was called the Glorious Revolution. A revolution is a well-planned, well-financed affair that succeeds and is permanent in nature. It is always part of a bigger plan for a better world. The Glorious, Industrial, American and French revolutions are all interrelated, and they opened the door to the great world we live in today. A war, an uprising, a rebellion, a revolt, or a military coup can only be called a revolution if it succeeds and is permanent in nature, in other words, if it has the international financiers’ approval.

When the owners of the East India Company decided to finance the construction of the chateau de Versailles, it was with the aim of destroying the Holy Roman Empire. Naturally, they started with the most obvious target, France, its crown jewel. The construction of the chateau was the first step in a long series of events that would lead to the French Revolution. Construction of the chateau began in 1661, and by 1678, it looked like the chateau we know today. Once things were well under way in France, the owners of the East India Company turned their full attention to the upcoming Glorious Revolution. In 1688, that revolution would give England a constitutional monarchy, and the world a new form of government called democracy.

After his father’s execution in 1649, Charles II of England had fled to the Netherlands where he had lived in exile until he had been invited back in 1660 after Cromwell’s demise. He subsequently wore the English crown from 1660 until his death in 1685. As the shareholders of the East India Company had expected, much of England grumbled under his rule because he was for letting Catholics sit in parliament, and because he had befriended King Louis XIV of France. The shareholders of the East India Company, who effectively ran the Netherlands, did their best to encourage the antipapist feelings, hoping to have him deposed and replaced with a constitutional monarch. When, in 1672, king Charles asked Louis XIV to do him a favor and declare war on the Netherlands, it was time to act and figure out a plan.

Since Charles II had no legitimate heir, his younger brother, James II, a catholic, was next in line. They would wait for Charles’ term to run out, while continuing to stoke anti-royalist feelings among English parliamentarians. Then, since James II had a daughter who was being raised as an Anglican, arranging a marriage between her and William III seemed to be a good long-term goal. As a Catholic, James II would be easy to overthrow, and when the time came, the crown would be handed to Mary who was next in line.

In 1677, the marriage between Mary II of England and William III of Orange was celebrated in St. James Palace, and it wasn’t a happy affair. At fifteen, an arranged marriage with a much older and repulsive William was not meant to make Mary happy, and she cried throughout the whole ceremony. She had a very unhappy life, especially while in the Netherlands, where she lived for the first eleven years of their marriage. William was a homosexual who spent most of his time leading a double life away from home, and Mary spent all that time in a castle on the outskirts of The Hague. She returned to England in 1688 after the “Immortal Seven” invited her and her husband to come to England and wear the crown. William landed in England with a small army, and he marched on London without hardly firing a shot. James II took off for France, and parliament subsequently declared the crown vacant. William and Mary were then both offered the crown after signing the Bill of Rights which precluded that they submit to parliament’s authority and have no catholic descendants. That series of events is known in the history books as the Glorious Revolution.

However, that was only half of what was to be democracy, England now needed a financial institution. And as it so happened, not about to throw in the towel, and wanting James II to reclaim the crown of England, the Pope gave the financiers the perfect opportunity to create the Bank of England. The French king’s powerful navy gave the English navy a good drubbing as it went about invading England by way of Ireland. Naturally, the English parliament was asked by King William to retaliate and build a strong navy. But since no public funds were available, and since the credit of William III’s government was non-existent, it was impossible for parliament to borrow the huge sums needed. The East India Company shareholders were waiting for just that moment. They readily offered to become private subscribers providing they be incorporated into a company that would be known as the Bank of England. The bank was to be given exclusive lending rights to the government, and it was to be the only entity allowed to issue bank notes or coin money. Once the conditions were accepted, the necessary funds were raised in a matter of days, and the private financial institution known to this day as the Bank of England was created

For the first time in the history of mankind, the bankers were sure of being repaid in an orderly and just fashion. Parliament got rid of the antiquated Farmers’ General tax collection system inherited from France and proceeded to develop the country’s infrastructure in order to be better able to collect taxes. The shareholders of the East India Company had wanted an autonomous parliament because they were banking on a human foible whereby the people’s representatives, once their political campaigns, elections and salaries properly funded, would want to prove their worth and do things before taxes were collected. Since the Bank of England’s shareholders, now established in the City and in control of the English monetary system, could accept or refuse to finance the parliamentarians’ projects, they indirectly controlled all important developments in the country. That was democracy then, just as it today, and it’s the owners of the East India Company who created the concept. Democracy can only work if the concerned country is indebted, and a democracy is always indebted.

If democracy has proven itself to be the best political system in the world, it’s because people representation and monetary control are separate. The people’s representatives manage things while the bankers decide what’s to be managed by increasing or decreasing the flow of credit. If the one who prints the money is the same as the one who spends it, that is, if the parliamentarians do the printing and the spending, the system can only implode.

10-EAST INDIA COMPANY

 

In the Netherlands, William the Silent, also known as William of Nassau and Prince of Orange, was a robust champion of Protestantism who encouraged thousands of Jews, new Christians as he called them, and Huguenots, Christian Protestants from France, to migrate to Amsterdam. Thanks to this influx, Amsterdam became the trading capital of the world and the Dutch ruled the oceans for much of the 17th century.

Sephardim were money men while Huguenots were entrepreneurs, and together, they formed a formidable team. They created the East India Company in 1600, in London. but in 1602 they decided to move their headquarters to Amsterdam. Even though Jews and Protestants had been free to enter England, a development that had started under Henry VIII, the people were still very much brainwashed by the old ideas of the Roman Church. So, because the Marranos weren’t free to practise their religion, and because Protestants were still viewed as enemies, the company shareholders decided to set up their headquarters in Amsterdam.

Once established in Amsterdam, they got right down to business. In order to protect the North American fur trade, the company shareholders built a fort at the tip of Manhattan in 1609 which would become New Amsterdam in 1624, and later, New York. In 1652, they expanded and created a colony on the Cape of Good Hope in South Africa, in order to protect the spice trade with Asia. The Dutch East India Company ruled the waves, and its founders, Jews and Huguenots, became so rich and powerful, that they could start planning the demise of the Holy Roman Empire.

But they hadn’t given up on re-establishing the company’s headquarters in London, for England was across the channel from France and its economy had much more potential. However, before they could return, they would have to find a way to get rid of the papist kings and get a king that would accept parliamentary rule. As it so happened, there were strong anti-royalist feelings in the English parliament, and the word Catholic was starting to be used to distinguish the papist followers from the Anglicans. Because Charles I, a Catholic, had just been crowned after marrying the Catholic Bourbon Princess Henrietta, it wouldn’t be too difficult to finance an army that would answer to an anti-royalist parliament, defeat the catholic king, and force him to accept parliamentary rule. The country was ripe for civil war.

Oliver Cromwell came to the financiers’ attention in 1642, when he joined the roundheads, the pro-parliamentarians. At the outset of what became known as the English civil war, he distinguished himself militarily and was subsequently promoted to commander of the New Model Army. Over the next few years, the royalist forces were defeated, and when Charles 1, the divine right king, was captured following a battle in Scotland in 1645, he was handed over to the English parliament which was under the protection of Oliver Cromwell’s New Model Army. However, Charles refused to accept a constitutional monarchy and escaped. In 1647, he was recaptured, and in 1648, he was tried, convicted and executed. Cromwell then dominated the Rump Parliament created in 1649.

But Oliver Cromwell was a puritan fanatic who had been extremely aggressive towards Ireland and Scotland, both catholic strongholds. Not able or not wanting to work with the Irish and Scottish parliamentarians, he simply dissolved parliament. After assuming the title of Lord Protector of England, Wales, Ireland and Scotland, he turned the powerful English navy against the very financiers that had financed it, the shareholders of the Dutch East India Company. He wanted England to take charge of the Atlantic trade. Of course, that was not to be, and Cromwell was doomed.

When Cromwell died from natural causes in 1658, his inept son couldn’t hold the Protectorate together, and the Convention Parliament decided to recall the Catholic kings. During the Restoration period (1660-1688), two kings of divine right, the two sons of Charles I, James II and Charles II, ruled in turn and fought the East India Company for trade supremacy.

The Jews and Huguenots both in Amsterdam and in London had to find a way to put a stop to the fratricidal naval wars and especially to the rule of papist kings in England. An arranged marriage between William of the House of Orange and Mary of the House of Stuart would be a very good way to do just that. In the interim, the financiers turned their attention to France.

9-HUGUENOTS

The Christian Church was intolerant and sanguinary from the very beginning and it fostered much hate throughout the Holy Roman Empire. The absolute kings of divine right, anointed by the Pope, ruled over the different parts of the empire and not only persecuted the Jews, the ‘Christ killers’, but all those who refused to follow the Roman Church’s liturgy as well. For instance, the Pope would suggest the need for a crusade, and the kings and nobles fearing excommunication, or wanting to earn their passage into heaven, would be quick to raise an army, France leading the way. The first crusade was against the Muslims in 1099. After slaughtering the Muslims in Jerusalem, the French conquered Palestine and established the Kingdom of Jerusalem which lasted until 1291. In 1209, Pope Innocent III asked the French king to carry out a crusade against his own people, the Cathars, and it lasted from 1209 to 1229. The Cathars were completely annihilated down to the last ‘good man’ who was executed in 1231, more than a million in all. All this because the peaceful Cathars refused to accept the Roman Church’s liturgy.

The Church committed so many atrocities and was so inflexible that opposition to it could only grow. So, when Gutenberg’s printing press came along in 1440, it slowly paved the way for the Protestant Reformation that was to come. At first, printing had a very limited impact, for it was used mainly to print the Bible and such. The Church controlled what was being printed, the language used was Latin, only a few scholars could read, and fewer still could write.

In Germany, in 1517, the pamphlet was first used by the leaders of the protestant movement to inflame popular opinion more efficiently against the Pope and the Church. Martin Luther was one of the earliest and most effective pamphleteers. The coarseness and violence of the pamphlets on both sides and the public disorder attributed to their distribution led to their prohibition. Many scholars, disgusted by the abuses and barbarism of the Church, rallied to Luther’s side, and started reading the contents of the pamphlets to the masses. The Protestant Reformation was not about to go away.

By 1520, Luther’s ideas had spread in France, and as early as 1521, at the initiative of the Sorbonne, the condemnations of the Protestant heretics began. Fines and prison sentences were imposed on lowly infidels, while heretical monks and priests were condemned to the stake.

Then came along Jean Calvin, a follower of Luther, who would do something Luther hadn’t considered doing. Luther had mainly been a reformer trying to change the Church from within, but Calvin, a French humanist, wanted much more, he wanted to lay down the rules for a new religion. He had great success among the French bourgeoisie, which comprised the greatest entrepreneurs of the day. Wanting to make up for lost time after the Hundred Years’ War, these businessmen wanted the backwards and cruel Roman Church out of the way. They of course used pamphlets to make their views known, and after the ‘Affaire des Placards’ in 1534, King François I, having lost patience with them, had several of their leaders hanged or sent to the stake. Following these events, Jean Calvin left France and settled in Geneva. Other French Calvinists started emigrating to Hanau, Amsterdam and London.

While Latin continued to be the language of the Roman Church, French became that of the Calvinists in France and French-speaking Switzerland. As of 1570, the printing houses in Geneva and Amsterdam became major centers for the dissemination of French, and consequently of Calvinism. The French nobility had massively adhered to Calvinism as early as 1555. The French Roman Christians, feeling threatened by the Calvinists, perpetrated the Wassy massacre in 1562, when several hundred innocent Huguenots, as Calvinists began to be called, were slaughtered like animals. Then, in 1572, with printing becoming widespread in France, the Huguenots were on the verge of tipping French political power in their favor, and King Charles IX, no doubt with papal approval, engineered the massacre of St. Bartholomew. On the night of August 24, 1572, more than 10,000 noble and notable Huguenots were killed, in Paris and in the provinces.

Because of the Placards Affair in 1534, the massacre of St. Bartholomew in 1572, the siege of La Rochelle in 1627, and the dragonnades under Louis XIV in 1681, hundreds of thousands of Huguenots migrated to more clement lands, and it was the biggest brain drain in the history of any country. That’s why, when Henry VIII was forced to open the door to those with financial and business skills in 1534, many Huguenots had ended up in England where French was still widely spoken among aristocrats.

But in 1573, when William of Nassau-Orange converted to Calvinism, and later, in 1579, when the Treaty of Union was signed in Utrecht, making the Netherlands independent from Spain, Amsterdam became a Huguenot haven and many Calvinists were encouraged to join up with their brothers who were already established there. More importantly, when the Marranos started arriving after their expulsion from Portugal, they joined forces with the Huguenots in both London and Amsterdam, and their union changed the face of the earth

7-HOLY ROMAN EMPIRE

From 481 to 751, the Merovingians converted the Arian populations to Christianity with great success, and since conversion implied conquest, France became the greatest power within the Holy Roman Empire.

In 771, after the suspicious death of his brother Carloman I, Charlemagne ousted his two young nephews, legitimate heirs of their father, and took possession of the kingdom. The nephews took refuge in Italy among the Lombards with their mother. Charlemagne pursued them and captured them in Verona where they vanished without a trace, probably having been imprisoned in a convent.

After conquering the Lombards, Charlemagne spent several years subduing the Saxons to the north and conquering the Muslims to the south. Charlemagne became extremely powerful, and before France engulfed the Holy Roman Empire altogether, the Pope reacted. He decided to consecrate Charlemagne emperor of the Holy Roman Empire in Rome on December 25 of the year 800. Feeling more important as emperor of the Holy Roman Empire than as king of France, Charlemagne accepted, and without realizing it, restored the authority of Rome over France.

Europe being entirely converted, and the faithful being obliged to pay tithes, it resulted in considerable revenue for the empire. In addition, many of the faithful were willing to pay to have their sins redeemed, and many others bequeathed their property to the Church in order to secure a place in heaven after death. The Holy Roman Empire thus became not only a gigantic financial power, but also a power that tolerated no competition.

In a position of strength, the Bishop of Rome undertook to convert the populations of England, Scotland and Ireland. He chose to send William the Conqueror, Duke of Normandy, across the Channel in order to make him King of England. But in doing so, the Pope made a major mistake, because when William the Conqueror was crowned King of England, he continued to be Duke of Normandy, and that didn’t bode well for future relations between France and England. When, in 1152, William’s great-grandson, Henri Plantagenet, married Aliénor of Aquitaine, ex-wife of Louis VII, king of France, the kingdom of France and that of England became seriously entangled. In fact, when the third son of Eleanor and Henry II, Richard the Lionheart, became King of England in 1189, he was Duke of Normandy, Duke of Aquitaine, Count of Poitiers, Count of Maine and Earl of Anjou. Fortunately, during his reign, which only lasted from 1189 until his death in 1199, he spent barely a few months in England, and thus, there was no war between France and England during that period. The first war took place in 1202 when Philippe Auguste, king of France, seized the Duchy of Normandy which had been passed down to Jean sans Terre, Richard’s youngest brother. The Hundred Years’ War between French Kings of England and French Kings of France was to officially start in 1337. That’s when Edward III, king of England, and direct descendant of the king of France on his mother’s side, declared himself to be king of France. The battle for the crown of France remained a bloody family affair for over a century.

Nonetheless, when the Pope sent William the Conqueror to England in 1066, Rome’s cruel ways didn’t lessen in other parts of the empire, and the historical period that followed was extremely violent. In 1095, Pope Innocent III launched the first crusade in order to liberate the holy places of Jerusalem from the Muslims who forbade their access to Christians. In 1099 the Franks managed to seize the city of Jerusalem. After two hundred years of rule, the Frank kingdom known as the Kingdom of Jerusalem collapsed in 1291 following the defeat of the Franks in Saint-Jean-D’Acre.

In France, the crusade against the Albigensians began in 1209 with the Béziers sack where the whole population was massacred, and officially ended in 1321 when the last of the Good Men, Guillem Bélibaste, was burned at the stake. But in fact, the last group of Cathars, 510 strong, died in a cave in Lombrives in 1328 after the crusader, Simon de Montfort, walled the entrance to the cave and left them to die. For many centuries, countless infidels, whether Cathars, Muslims or Jews, were tortured, killed and sent to the stake by the Bishop of Rome’s henchmen, and this heretic cleansing lasted long after the death of Joan of Arc in 1404. In 1484, Pope Innocent VIII preached an inquisition against witchcraft, an attack directed against women where many were condemned to the stake. Later, this religious barbarism was even adopted by the Protestants, as exemplified by the Salem trials in America in 1692, where dozens of women were hanged for witchcraft.

With regards to the fratricidal wars between England and France, when Edward I of England was crowned king in 1272 following his return from the ninth crusade, he declared he had legitimate rights over France because he held title to all the fiefs of western France, from Flanders to Aquitaine. And Philip IV, known as Philip the Fair, who reigned from 1285 to 1314, didn’t help to pacify things. During his reign, he transferred the Holy See of Rome to Avignon, and because the kings of the Holy Roman Empire were not disposed to submit to the authority of a Pope who answered to the King of France, the transfer was short-lived. However, when he officially declared that Aquitaine belonged to France, that decision was to lead to a fratricidal war that would last more than one hundred years.

Philippe the Fair having died in 1314, in 1337, Edward III of England not only declared that Aquitaine belonged to him, but that he was the legitimate heir to the throne of France on his mother’s side. His mother was Isabelle of France, daughter of Philip the Fair. Not surprisingly, the Plantagenets and the Valois clashed on the battlefield many times over the next hundred years, until Louis XI, king of France, took definite possession of Aquitaine in 1453.

The atrocities committed against the “heretics” by the Bishop of Rome with the help of his absolute kings of divine right over so many centuries, were unspeakable. And they continued after the 100 Years War with Inquisitions against the Jews in the Iberic Peninsula. However, when the Church started to persecute the Protestants within France’s borders, it signed its death warrant. The Protestants, also called Calvinists or Huguenots, were business entrepreneurs with great know-how, and they wanted to make up for lost time following 116 years of senseless war. But because the idea of making a profit went against the Roman Church’s doctrine, the Bishop of Rome decided to apply his well-tried persecution tactics with the help of his French kings.

The French Protestants would become the Church’s mortal enemy, and would eventually join forces with the Jews in Amsterdam. The two persecuted groups would go on to create the East India Company in 1600, an institution that would eventually replace the Holy Roman Empire as a financial and political power. However, the Bishop of Rome had seen the threat developing in early 16th century, and had anointed Charles-Quint Emperor of the Holy Germanic Empire in 1520. But the latter failed in his mission to counter French power, as well as in his attempt to put an end to the Protestant Reformation, and his reign was not only ineffective but a serious setback for the Holy Roman Empire.