I wrote a few weeks ago about Mayer Amschel Rothschild, the progenitor of the banking dynasty. A wily operator, he ensured that the empire he founded would have a future, by sending each of his five sons to open a branch of the business in a different European capital. I thought it might be interesting to carry on the story, writing periodically about how the various sons fared.
The first young man to leave the family nest in the Frankfurt ghetto, and arguably the most entrepreneurial of them all, was Nathan Mayer Rothschild. Born in 1777, the third of the five sons, he was in his early twenties when Napoleon began his march across Europe, destroying lives and devastating economies. British manufacturers, whose economy was relatively unscathed, tried to take advantage of the turmoil in the European markets and Nathan Mayer spotted an opportunity. He persuaded his father to send him to Manchester, the world’s first modern industrial city and the centre of Britain’s burgeoning textile trade.
Nathan’s plan was to set up as a textile trader and cut out the middle man. He would sell printed fabrics directly from Manchester to his father’s extensive network of clients in Europe, and to the British army, which was gearing up for war. He arrived with £20,000 in his pocket, a considerable sum of money for those days, and without knowing a word of English. He was shrewd, buying fabric from small cotton spinners who were willing to accept lower prices than the major manufacturers and using local printers rather than the large, expensive firms in Glasgow and London. It allowed him to boast that he could sell his goods cheaper than anyone. He also ran several sidelines, selling raw cotton and dyestuffs and dealing in coffee, wine and sugar.
After about five years he headed for London, where he hoped to be accepted by the city’s very small circle of wealthy Jewish merchants and bankers. It was not easy for him, the four or five families at the centre of the circle prided themselves on their refined English ways and quasi-aristocratic bearing. As rich as he was, Nathan Mayer had not yet shaken off his origins in the Frankfurt ghetto, where his parents had always been obliged to live. He had developed a reputation in Manchester as something of a sharp dealer, a brusque and offhand entrepreneur who paid little attention to his physical appearance. He did not come across as the sort of person who would be an asset to London’s suave and snobbish Jewish families, striving to be accepted as full members of upper class English society.
Nathan Mayer did not care; he was persuasive, even if insensitive. He intended to marry well and asked Levi Barent Cohen, a prosperous city trader for the hand of his daughter Hannah. Barent Cohen did not jump at the idea but Hannah had her own mind and when she and Nathan eventually married she brought a £10,000 dowry with her.
The marriage gave Nathan Mayer access to an influential network of traders on the London Exchange, the forerunner of the Stock Market. He still had his business in Manchester, where he and Hannah lived initially, but as the war against Napoleon began to dominate affairs they spent more and more time in London. His father’s client, Prince William of Hesse was shifting his money into English securities; Nathan handled the deals in London and, since he received money several days before he was obliged to send it on, was able to build up a running supply of short term capital. He used it to buy gold for the British government, who needed it to pay the wages of their forces in Europe.
On one occasion he bought an entire shipload of gold, worth £800,000, from the East India Company, selling it on to the government for a tidy profit just a few hours later. He told a dinner companion “I went to the sale, and bought it all. I knew the Duke of Wellington must have it. I had bought a great many of his bills at a discount. The government sent for me, and said they must have it. When they had got it, they did not know how to get it to Portugal. I undertook all that, and I sent it through France; and that was the best business I ever did.”
By 1814 Nathan Mayer was handling all the government’s transfers of gold to Wellington’s armies in Europe. It was no easy matter; the bullion had to be smuggled past Napoleon’s forces and it was because Nathan Mayer had the most creative ways of moving the metal that the government chose to use him. Sometimes his 19 year old brother James dressed up as a woman, carrying the gold through the French lines in his clothes. At other times Nathan used a network of Mediterranean banks, beyond Napoleon’s reach, to cash bills of exchange, with the money then being transferred to the English forces. Everybody involved in these complex transactions did well, Nathan Mayer Rothschild more than most.
Nathan Mayer was now a household name in moneyed circles. Legends and rumours began to circulate about him. One of the most frequently repeated was about the fortune he is said to have made as a result of Wellington’s victory over Napoleon at the battle of Waterloo. According to one version of the story Nathan had been present at Waterloo when the battle was won, another version has it that he received the news by carrier pigeon. Either way, he dashed to the Stock Exchange and sold his entire holding of shares, forcing prices down. He then bought everything back at rock bottom while he was waiting for the news of the victory to reach London. When the victory was announced, prices shot up again and Nathan made himself even wealthier.
There may be some truth in the story but it is not as dramatic as the rumour suggests. Nathan did hear of the victory, through one of his agents in Dunkirk. He hurried to give the news to the Prime Minister, Lord Liverpool. The Prime Minister said that he would wait until receiving official confirmation from the army’s commander before making an announcement. 30 hours later, when the news came through the official channels, Nathan Mayer was sitting on as many shares as he could buy, selling them shortly afterwards at a huge profit.
Nathan Mayer Rothschild could still not speak English well, but the richer he became the more this was seen as part of his charm, rather than as a disadvantage. He and Hannah had seven children, all of whom, bar one, married members of London’s small, upper-class Jewish elite. The daughter who did not marry into the London circle was Hannah; she married in church, becoming the first Rothschild to leave the Jewish faith. (Over the next couple of centuries almost the entire dynasty would do the same.)
For all his business acumen and success, Nathan Mayer could never shake off his image of the uncouth, greedy miser. In some ways he played up to it, he told the German composer Louis Spohr that he didn’t care for concerts, that the jingle of money in his pockets was his kind of music. He told his brothers, “After dinner I have nothing to do. I do not read books, I do not play cards, I do not go to the theatre, my only pleasure is business.”
He was vilified by those who were jealous of his success. Cartoonists caricatured him, showing him overweight, bulbous nosed and puffy lipped. One contemporary wrote, “His mind was as capable of contracting a loan for millions, as of calculating the lowest possible amount on which a clerk could exist. Like too many great merchants, whose profits were counted by thousands, he paid his assistants the smallest amount for which he could procure them.” He resented such attitudes, complaining that one of his business partners “shakes me by the hand in the City but he can never see me in Piccadilly when he is walking with a duke.”
The attention he continually received made him nervous. He received several death threats. Once two strangers came into his office. When he saw them move their hands towards their pockets he hurled a large ledger at them and yelled for help. He thought they were about to reach for their guns. They had been trying to hand him their letters of introduction.
In June 1836 Nathan travelled to Frankfurt for the wedding of his son Lionel. The ceremony was held in Frankfurt so that his elderly mother could attend. He was not well, he got through the wedding ceremony without mishap but then took to his bed. The German doctors could do nothing for him and in her alarm Hannah brought over their own doctor from England.
It was too late. Nathan Mayer Rothschild died on July 28th, 1836. He was 59 years old. The baton was passed to his son Lionel. He, in turn, would become the first Jew to sit in the English parliament.
The bank Nathan Mayer Rothschild founded 200 years ago, N.M. Rothschild and Sons, still trades. Although no longer a Jewish bank, it still pays homage to its Jewish founder. Bread is not served in its dining room on Passover.