wall street a history sep 1997

[...]... diverse place and a land of unparalleled opportunity The existing merchant class, mostly British and Dutch by origin, had already carved out lucrative careers as merchant traders They made their livings in countless ways, but most revolved around trading essential commodities that Europeans coveted, such as furs, natural resources, and tobacco Land speculation was another area that drew attention because... much capital abroad, in hope of reaping profits from overseas ventures This was possible, and necessary, because both had excess domestic capacity and money and were anxious to find new areas of profit And many years before the American Revolution, both had already had their share of financial scandal, the South Sea bubble and tulip speculation being two of the more noteworthy These early scandals had... specie payments were not required they could achieve significant financial control over the states that chartered them What the second bank lacked in investor confidence was quickly erased by a landmark judicial decision The new bank was aided immeasurably by Chief Justice John Marshall in the landmark 1819 Supreme Court case McCulloch v Maryland Maryland had attempted to tax all banks and bank branches... leverage was not well accepted Borrowing money to become successful in business was becoming popular because it was recognized as the only way that capitalism could be practiced in some cases But the practice was still not socially acceptable and also had a weak institutional underpinning Between independence and the Civil War, land played the pivotal role in American investments and dreams The vast areas... industry and, with it, Wall Street The great industrialists and bankers emerged during this time to create the leviathan industrial trusts that dominated economic life for nearly half a century Although the oldest Wall Street firms were only about fifty years old at the turn of the century, they were treated as aristocracy The great banking houses of Morgan, Lazard, and Belmont were relatively young but came... advantage of others have been replaced with investor protections and a bevy of securities laws designed to keep the poachers out of the henhouse, where they had comfortably resided for almost 150 years Bull markets and bear markets are the stuff that Wall Street is made of The boom and bust cycle began early, when the Street was just an outdoor market in lower Manhattan The first major trauma that... branches in that state that were not chartered by the state legislature This policy was aimed directly at the Bank of the United States, which had a branch in Baltimore McCulloch, the chief cashier of 24 WALL STREET the bank, failed to pay a $15,000 annual fee required by the state, resulting in the lawsuit The Maryland courts had ruled against McCulloch, and the case eventually found its way to the Supreme... attention because the Americans had an abundance of land and the Europeans desired it probably more than any other type of property In these endeavors the great American fortunes—those of Girard, Astor, Biddle, and others—would be made, and occasionally broken Most of America's riches were based upon an abundance of land The New World provided more than just space for the land-starved Europeans The millions... original orders of business was to establish the Bank of the United States, which was incorporated in 1791 The Early Years 15 The main office was located in Philadelphia, with branch offices in New York and other major East Coast cities Unlike many of the chartered commercial banks of the period, the central bank was provided with branches in other states, a practice that annoyed many state bankers,... central bankers would argue that this practice was necessary to prevent inflation and debasement of currencies, the state banks saw it as poaching on their ability to make, and indeed manufacture, money Their opposition to the second bank in a sense underlined the reason so many merchants were turning to banking after the War of 1812 State banks were capable of coining their own money, and as long as . York Athens Bangkok Buenos Aires Cape Town Chennai Dar es Salaam Delhi Hong Kong Istanbul Karachi Kolkata Kuala Lumpur Madrid Melbourne Mexico City Mumbai Nairobi Sao Paulo Shanghai Taipei. theme of Wall Street& apos;s history. CHAPTER ONE The Early Years (1790-1840) Remember, time is money. Benjamin Franklin America in 1790 was a diverse place and a land of unparalleled. trading essential com- modities that Europeans coveted, such as furs, natural resources, and to- bacco. Land speculation was another area that drew attention because the Americans