Every Man a Speculator: A History of Wall Street in American Life

by Steve Fraser

Overview

Americans have experienced a love-hate relationship with Wall Street for two hundred years. Long an object of suspicion, fear, and even revulsion, the Street eventually came to be seen as an alluring pathway to wealth and freedom. Steve Fraser tells the story of this remarkable transformation in a brilliant, masterfully written narrative filled with colorful tales of confidence men and aristocrats, Napoleonic financiers and reckless adventurers, master builders and roguish destroyers. Penetrating and engrossing, this is an extraordinary work of history that illuminates the values and the character of our nation.

Product Details

ISBN-13:	9780066620497
Publisher:	HarperCollins
Publication date:	02/07/2006
Series:	P.S. Series
Edition description:	REPRINT
Pages:	768
Product dimensions:	5.31(w) x 8.00(h) x 1.23(d)

About the Author

Steve Fraser is the author of Labor Will Rule: Sidney Hillman and the Rise of American Labor, which won the Philip Taft Prize for the best book in labor history. He is also the co-editor of The Rise and Fall of the New Deal Order. He received his Ph.D. in American history from Rutgers University, and his work has appeared in the Los Angeles Times, the Nation, the American Prospect, Raritan, and Dissent. He lives in New York City.

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Every Man a Speculator
A History of Wall Street in American Life

Chapter One

Revolution and Counterrevolution

One of the strangest documents ever authored by a public official appeared in 1797. Soon to become known as the "Reynolds Pamphlet," its formal title, so typical of eighteenth-century literature, amounted to a miniature essay in its own right: "Observations on Certain Documents Contained in #s 5&6 of 'The History of the United States for the Year 1796' in which Charges of Speculation Against Alexander Hamilton, Late Secretary of the Treasury, Is Fully Refuted by Himself." An accusation of financial malfeasance in office is, in itself, hardly an extraordinary occurrence, even when, as in this case, directed against a founding father. What makes the "Reynolds Pamphlet" at the same moment so titillating and so somber is the unimaginably bizarre combination of circumstances that gave rise to its publication. Those circumstances touched on the most intimate affairs and affairs of international gravity. Charges of financial impropriety notwithstanding, what was really at issue in the "Reynolds Pamphlet" was illicit sex on the one hand and global revolution and counterrevolution on the other.

Alexander Hamilton's refutation is first of all a deeply humiliating public confession. He acknowledges not any financial wrongdoing, but rather that he engaged in an adulterous affair some years before, during his tenure as secretary of the treasury, with the wife of one James Reynolds. This adultery, he further reveals, was carried on, perhaps from the very beginning and certainly after a decisive turning point in the affair, with the full connivance of Mr. Reynolds. That odd moment arrived, according to the secretary, when James Reynolds confronted him with his knowledge of the relationship and a demand for $1,000. When Hamilton paid the money, Reynolds made it clear the adultery could continue, presumably in return for future installments. The secretary concludes the confessional part of his pamphlet by apologizing to his loving wife for these inexcusable transgressions. And he explains, only his sense of honor, the need to clear his name of the graver charge of official misconduct, could have driven him to expose his wife to this embarrassing and shameful ordeal.

Most of the "Reynolds Pamphlet," however, runs in a very different direction. The whole ugly business is not, Hamilton contends, really about sex or even about financial hanky-panky. Instead he blames it all on the riotous spirit of Jacobinism loose in the world. Regicides and terrorists in Hamilton's eyes, French revolutionaries had formed an infernal brotherhood with the noisome rabble gathered around Thomas Jefferson, his bitter political rival. Conscienceless foes, these American Jacobins will resort to any kind of calumny, will even exploit Hamilton's moment of sexual weakness, to perpetrate monstrous lies not only about him but about all men of "upright principles."

Hamilton is determined to defeat this "conspiracy of vice against virtue." His pecuniary reputation remains "unblemished," he avers, since during his whole term as secretary of the treasury he was indifferent to the acquisition of property. Yet his Jacobin enemies are so bottomlessly unscrupulous as to accuse him of sacrificing "his duty and honor to the sinister accumulation of wealth," and of promoting "a stock-jobbing interest of myself and friends." These charges, he notes, first surfaced in the earliest years of the new government, back in 1791, and when they did it was he, Hamilton, who demanded a formal congressional inquiry. That investigation, conducted by a committee whose majority consisted of his political opponents, showed that rumors of public monies being made "subservient to loans, discounts, and accommodations" for Hamilton and his friends were groundless. Yet, despite this complete exoneration, these slanders are being recirculated by those infected with the Jacobin conta-gion, including such distinguished statesmen as Senator James Monroe, not to mention Hamilton's one-time corevolutionists and now inveterate enemies, Thomas Jefferson and James Madison.

And what then might be the connection between Jacobinism and the secretary's sexual adventure? It turns out, according to Hamilton, that it was James Reynolds, the cuckold, and an otherwise obscure, frustrated place seeker, who first alleged that Hamilton had confided in him about a conspiracy to speculate in government bonds. It was that rumored conspiracy, purportedly conceived and captained by Hamilton, taking advantage of his unique position as the fledgling nation's chief financial officer, which made the disreputable Reynolds and his wife tools of the Jacobin menace. People like Madison and Jefferson were scarcely concerned with Hamilton's marital infidelities. Moreover, no matter how much they otherwise distrusted his motives, given the secretary's impeccable reputation for integrity, it is doubtful they ever took seriously the charge that he was lining his own pockets. What they feared and truly believed was rather that Hamilton was the evil genius responsible for implanting at the heart of the virgin republic a system of finance that not only bred precisely the kind of conspiracy of speculators he was rumored to belong to, but, more fatally, a system of speculation that would raise to power a "moneyed aristocracy" intent on undoing the great democratic accomplishments of the Revolution. Not sex, not peculation, but the specter of counterrevolution turned Hamilton's tryst into an affair of state.

How could they have come to feel this way? At least part of the answer lies in a vital detail of James Reynolds's concoction. Hamilton's chief coconspirator, so Reynolds claimed, was one William Duer. And it is in the career of William Duer that one can first glimpse how Wall Street found itself at the core of a great, life-and-death controversy over the fate of the American Revolution.

Every Man a Speculator
A History of Wall Street in American Life. Copyright © by Steve Fraser. Reprinted by permission of HarperCollins Publishers, Inc. All rights reserved. Available now wherever books are sold.

Table of Contents

	Preface	xi
	Introduction	xv
Part 1	Buccaneers and Confidence Men on the Financial Frontier
1	Revolution and Counterrevolution	3
2	Monsters, Aristocrats, and Confidence Men	30
3	From Confidence Man to Colossus	70
4	Wall Street in Coventry	106
Part 2	The Imperial Age
5	The Engine Room of Corporate Capitalism	155
6	The Great Satan	193
7	Wall Street and the Decline of Western Civilization	225
8	Wall Street Is Dead! Long Live Wall Street!	247
9	Other People's Money	281
10	War and Peace on Wall Street	330
11	A Season in Utopia	362
Part 3	The Age of Ignominy
12	Who's Afraid of the Big Bad Wolf?	411
13	Evicted from the Temple	440
14	The Long Good-bye	472
Part 4	The World Turned Upside Down
15	The Return of the Repressed	525
16	Shareholder Nation	573
	Notes	617
	Index	685

What People are Saying About This

David Nasaw

“Should be widely read by scholars, students, and anyone interested in America’s ambivalent relationship with big business and big finance.”

Walter A. McDougall

“Big, boisterous, biting, and brilliant. . . . both page-turner and scholarly tour de force.”

Sean Wilentz

“Remarkable. . . . Fraser tells the tale in high style.”

Eric Foner

“Written with verve and passion. . . . offers a remarkable array of insights into the history of American capitalism.”

Editorial Reviews

Written with verve and passion. . . . offers a remarkable array of insights into the history of American capitalism.” — Eric Foner, DeWitt Clinton Professor of History, Columbia University

“Big, boisterous, biting, and brilliant. . . . both page-turner and scholarly tour de force.” — Walter A. McDougall, Pulitzer Prize-winning author of Freedom Just Around the Corner

“Remarkable. . . . Fraser tells the tale in high style.” — Sean Wilentz, Dayton-Stockton Professor of History, Princeton University

“Should be widely read by scholars, students, and anyone interested in America’s ambivalent relationship with big business and big finance.” — David Nasaw, author of The Chief

“Comprehensive, considered, and literate: a real accomplishment.” — Kirkus Reviews (starred review)

“Fraser gives a thorough analysis of this scandal-ridden menagerie as reflected in books, movies, and the political arena.” — Booklist (starred review)

From the Publisher

Should be widely read by scholars, students, and anyone interested in America’s ambivalent relationship with big business and big finance.

David Nasaw

Big, boisterous, biting, and brilliant. . . . both page-turner and scholarly tour de force.

Walter A. McDougall

Fraser gives a thorough analysis of this scandal-ridden menagerie as reflected in books, movies, and the political arena.

Booklist (starred review)

Remarkable. . . . Fraser tells the tale in high style.

Sean Wilentz

Written with verve and passion. . . . offers a remarkable array of insights into the history of American capitalism.

Eric Foner

"Fraser gives a thorough analysis of this scandal-ridden menagerie as reflected in books, movies, and the political arena."

Booklist

This is not so much a financial as a cultural history. Fraser's ambition is to examine ''how Wall Street has entered into the lives of generations long passed and those alive today . . . the way the character of America has changed.'' He recognizes the dubiousness of fixing a unitary character on a polymorphous people, but argues that if you distill all the histories, all the satiric cartoons, the brimstone sermons, the exposes, the Horatio Alger storybooks -- all the Wall Streets of the mind -- Wall Street becomes ''a window into the souls of Americans.''
— The New York Times

Sir Harold Evans

The result is an illuminating tour of how the United States has perceived its financial center over two centuries through the eyes of its political leaders, novelists, moviemakers, preachers, cartoonists, ordinary citizens and a host of others. This exercise "is both a probe into the American character and an inquiry into the way the character of America has changed," Fraser writes. In the process of telling this sprawling tale, he sometimes goes on too long, and his attempt to draw sweeping conclusions about America's changed character is strained. But his prose is elegant, and his eye for historical detail is keen, carrying the reader through the many sagas that he entertainingly recounts.
— The Washington Post

Paul Blustein

Tracking the changing-and often conflicting-public attitudes toward Wall Street through myriad forms of American popular culture, Fraser (Labor Will Rule) renders two centuries' worth of opinions, and shows how the country's orientation toward "the street that runs from a river to a graveyard" has affected the nation's politics, its fashion and its morality. Fraser uses a wealth of primary and secondary sources (from the Constitution of the New York Stock Exchange and Walt Whitman to Kevin Phillips's Wealth and Democracy) to detail the first hundred years, from the Buttonwood Tree trading of 1792 (where 24 men gathered near 68 Wall Street) to J.P. Morgan. His selections from the last quarter-century result in a narrow and not very coherent opinion piece on the tech boom; the strength of the book is the period from 1890 to 1980. Fraser draws on cartoons, popular songs, promotional literature as well as more conventional material to sketch hundreds of stories detailing the image of Wall Street as it rises and falls in the public imagination. Almost every page contains wildly mixed metaphors and other excesses of enthusiasm over clarity, but Fraser tells a monumental story with real energy: moral disapproval of usury, gambling and single-minded moneymaking fade as bankers come to embody the hope and threat of the future. Careful consideration of subtle changes in popular notions makes good sense of the transformation from Gilded Age to Information Age, and of the complex conflicts many people still feel. (Feb. 1) Copyright 2005 Reed Business Information.

Publishers Weekly

Writer, historian, and book editor Fraser (The Bell Curve Wars) presents a monumental cultural history of speculation in the United States as played out on the stages of Wall Street. Informing this rich chronicle are authentic newspaper reports, magazine pieces, letters, movies, novels, plays, transcripts, and other eyewitness accounts dating from Dutch Colonial times to the present. Fraser's painstaking research reveals much about the major players of Wall Street, from Cornelius Vanderbilt to Michael Milken while shedding light on minor characters (e.g., Hetty Green, a.k.a., "The Witch of Wall Street") and historical events like the 1929 stock market crash and the Great Depression. Given how speculative the early Colonists were, the invention of Wall Street was certainly no accident; the author suggests its growth paralleled that of America itself with a similar "manifest destiny." This scholarly and entertaining encyclopedic history documents an important part of U.S. business history, which makes it an essential purchase for all libraries.-Richard Drezen, Washington Post/New York City Bureau Copyright 2005 Reed Business Information.

Library Journal

Main currents in American thought about money and Wall Street, traced by journalist Fraser (Labor Will Rule, 1991, etc.) in an expansive social history. The same attraction and greed that brought colonial traders together in the Street's coffeehouses or under its fabled buttonwood tree (fictional, debunks Fraser) continue to gather hustlers in myriad Starbucks or under trees everywhere in the world. The Wall Street of the American mind contains capital markets, commodities exchanges, mighty banking institutions, bucket shops, lenders, borrowers, buyers, sellers, owners, workers, debtors, creditors, confidence men, dupes, builders, thieves, entrepreneurs, swindlers, billionaires, tricksters, bulls, bears, and pigs. Fraser's grand, often incisive, survey begins with the Founders (Hamilton in particular) and the first IPO (the Bank of the US in 1791). We meet moguls and miscreants, including Gilded Age titans like Cornelius Vanderbilt, August Belmont, and evil Jay Gould. The author depicts Populists, muckrakers, Liberty Bonds, the Jazz Age, the Crash, Andrew Mellon, and Jay Gatsby. He neglects nothing of social significance, from Ponzi and the New Deal to Milken, the Long Term Capital Management fiasco, and WorldCom. He analyzes books, music and art as meaningful signals, paying heed to Melville, Dreiser, Dos Passos, Auchincloss, and Tom Wolfe, among others. He considers such cultural phenomena as agitprop, Thomas Nast, Eddie Cantor, Gordon Gekko, the Depression's Big Bad Wolf, and J.P. Morgan's nose. He bemoans the repeal of Glass-Steagall, the statute that once kept banks from being brokers. And he discerns a recurrent theme rarely noted by other surveyors of the Street: anti-Semitism,which prompted implausible accusations of Jewish manipulations from the likes of Father Coughlin and Henry Ford. Certainly, "Wall Street" is a synecdoche for much of our commercial culture. Will attentive readers be quite ready to privatize some of their Social Security funds after this visit to the lair of the plutocrats?Comprehensive, considered, and literate: a real accomplishment. Agent: Sandra Dijkstra/Sandra Dijkstra Literary Agency

Kirkus Reviews