The Jews in America Trilogy (15 page)

One thing was noticed that had not been apparent before: the two brothers looked almost exactly alike, with bright eyes, full beards, and high foreheads. The effect of twinship created the impression of one Lehman being several places at once, and their attitudes of bounce, ebullience, and good nature soon earned them the quaint nickname of “the Cheeryble Brothers.” (In their portraits which hang in the partners' room at Lehman Brothers, they do not look very Cheeryble; they look properly bankerly and stern, but doubtless being together after a long separation made them Cheeryble in 1868. At Lehman Brothers the bearded faces in the partners' room are called “the Smith Brothers,” since there is a certain resemblance to the cough drop pair.)

But appearances can be deceptive. Temperamentally, the brothers were quite different, Emanuel the “inside” money man, Mayer the outgoing contact-maker. Emanuel was conservative and cautious, Mayer speculative and bold. Members of the family have said that Emanuel would study the financial picture and say, “It's a good time to sell.” Mayer would look at the same evidence and say, “It's a good time to buy.” Once, at the height of a panic on the Cotton Exchange, Mayer was seen striding out of his office in silk hat, frock coat, and striped trousers, with his heavy gold watch fob swinging at his waist,
wielding his gold-handled stick and wearing a smile on his face and a general air of confidence. A young associate ran up to him and said, “Mr. Lehman, aren't you
worried?
” Mayer replied, “My dear young man, I see you have had no experience with a falling market,” and strode on. Others in the family summed up their differences, saying, “Mayer makes the money and Emanuel conserves it.” (In the portraits, one notices that Emanuel wears a dark and sober cravat; optimistic Mayer wears a jaunty, Cheeryble bow tie.)

Nor were the Seligmans and Lehmans the only immigrants in New York who were making the great transition from peddling and store-keeping in the provinces to banking in the big city. Now, in 1867, the downtown financial district noticed a new firm called Kuhn, Loeb & Company, and its top-hatted little proprietor, Solomon Loeb. At his wife's insistence, Loeb had moved from Cincinnati—the “Porkopolis” she hated—had bought a brownstone in East Thirty-eighth Street (though he was warned that it was “too far uptown” and was “sure to be a bad investment”), and had opened his private banking offices in Nassau Street. The firm had a starting capital of $500,000, and the original Kuhn, Loeb partners were listed as “A. Kuhn, J. Netter, S. Kuhn, S. Loeb, S. Wolff”—all relatives. (Loeb's original partner in the Cincinnati clothing business, Abraham Kuhn, soon retired from the firm and returned permanently to Germany.)

Marcus Goldman, another cloak-and-suiter, also yielded to his wife, and removed her from the city
she
disliked so much, which was Philadelphia. In New York, Goldman hung out a shingle in Pine Street announcing that he was now “Marcus Goldman, Banker and Broker.” The Goldmans entered the brownstone world of Murray Hill, and joined the group of families whose spiritual center was Temple Emanu-El, and whose acknowledged social leaders were named Seligman.

Marcus Goldman's downtown “office,” like those of most fledgling bankers of the day, was in sharp contrast to the way he lived uptown (around the corner from the Astors) and the way he dressed. Sumptuous downtown offices were still a long way off, and Marcus' was a cellar room next to a coal chute. In these dim quarters he installed a stool, a desk, and a wizened part-time bookkeeper (who worked afternoons for a funeral parlor).

In what was the standard banker's uniform—tall silk hat and Prince Albert frock coat—Marcus Goldman started off each morning to visit his friends and acquaintances among the wholesale jewelers in Maiden Lane, and in the “Swamp,” where the hide and leather merchants were
located. Marcus carried his business in his hat. He knew a merchant's chief need: cash. Since rates on loans from commercial banks were high, one means New York's small merchants had of obtaining cash was to sell their promissory notes or commercial paper
*
to men like Marcus at a discount. Commercial paper was then being discounted at 8 to 9 percent, and Marcus purchased these notes in amounts ranging from $2,500 to $5,000 and tucked the valuable bits of paper inside the inner band of his hat for safekeeping. As his morning progressed, his hat sat higher and higher above his forehead.

Then, in the afternoon, he would head uptown to the commercial banks. He would call on the Commercial Bank in Chambers Street, the Importers & Traders in Warren Street, or the National Park Bank in John Street. He would see the cashier, or perhaps the president, deferentially remove his hat, and they would begin to dicker.

Marcus was doing what Solomon Loeb was doing, what the Lehmans were doing with their cotton bills, and what the Seligmans were doing on a somewhat grander scale with their bonds (which in essence are simply government, or industry, promises to pay). Marcus, however, didn't seem to need partners. From the very beginning, he was able to sell as much as five million dollars' worth of commercial paper a year.

Bertha Goldman was able to afford, in 1869, one of the “sumptuous turnouts with liveried servants” described by Mr. Strong to take her on her morning rounds of shopping and errands. But Marcus chose to walk. So did Solomon Loeb. So did the Lehmans and the Seligmans. “Trading on the Street” meant just that. As the pedestrian bankers met each other, they bowed to each other solemnly. On their daily tours they appraised the altitudes of each other's hats.

Walking was becoming a tradition among the Jewish bankers. They all had wives who believed in feeding their husbands hearty breakfasts, enormous midday meals, and Lucullan dinners. Walking countered some of the effects of these. There was a point of dignity, too. Carriages were for lazy men and men of little consequence. The splendor of the conveyance could dim the splendor of the passenger folded up within. Walking toughened the physical and moral fiber, but it
was also a social form of locomotion. Walking, a man could meet his friends. Afoot, he could keep abreast of what the competition was doing. One did business while one walked, and one walked even when one sailed. In a few years' time, Jacob Schiff—who would tower above every financial figure in Wall Street—would be able to boast that he had made a million dollars while doing his morning constitutional about the deck of the
Berengeria
. (The Jewish bankers were remarkable among nineteenth-century travelers because they
talked
to people; gentile society of the period was antisocial when it traveled, afraid of strangers, foreigners, parvenus, and other dangerous shipboard alliances.)

Of course it also may have been true that the bankers walked out of habit. The grandiose phrase for men like Marcus Goldman, Solomon Loeb, and the Seligmans was “merchant bankers.” But they were, in many ways, still peddlers covering their routes, only now they were peddling IOU's.

*
Mr. Strong himself, however, owned ten thousand shares of Kenzula Petroleum.

*
Unless, of course, a persistent bit of gossip one still hears in New York is true–that the Astors themselves were originally Jewish. There is also a little band of old New York families who make the same assertion about the Vanderbilts.

*
One way to visualize a piece of “commercial paper” is to think of a post-dated check. If, today, you drew a check for $100 dated six months from now, based on funds you expected to have by then, you would find few people who would give you a full $100 for that piece of paper. But you might find someone willing to pay you $90, and that person, in turn, might find a more affluent source willing to buy it from him for $95. It is illegal to trade personal checks this way, but commercially it is quite a legal operation.

12

THE “OUR DEAR BABETTE” SYNDROME

By the war's end Joseph Seligman's wife had presented him with a total of nine children, five boys and four girls. Joseph's brothers and sisters, and their wives and husbands, were following Joseph's prolific example, and having seven, eight, nine, even thirteen children apiece. From the original eleven immigrant Seligmans, the combined Seligman family—husbands, wives, and children—had swollen to number 104, or, as Joseph reminded his brothers, a profit in people of 845 percent.

Dynastic Joseph mother-henned all the pregnancies in the family, which was quite a job since there were often several at once. Naturally he preferred male children to female, and he seems very nearly to have gotten his way. Of eighty-two Seligman children, forty-four were boys. The Seligman children also defied infant-mortality rates of the period. Of the four score plus who composed the second generation, only two did not live to maturity. This healthy and numerous
tribe would, one might think, provide personnel to staff an operation of almost any size.

There was only one trouble, one which affects all dynasties, and one which New York German Jewish families, who drew an equation between the family and the business, would all encounter. Joseph encountered it early, long before he was required to tackle the job of fitting sons, sons-in-law, nephews, and nephews-in-law into the slots he had ordained for them. No sooner had he got his transatlantic and transcontinental table of organization set up, with each brother-in-law and brother in his appointed place, than he discovered he had men who were unhappy at, or unequal to, their duties. There was Max Stettheimer, for instance, Joseph's sister Babette's husband.

The position of a Seligman sister was a difficult one to begin with. She was totally dependent on her brothers for money, and though they were generous, it was in a high-handed way which left the girls in the dark as to how wealthy the family really was. Monetary matters were considered damaging to a woman's brain, and so the Seligman brothers spared their womenfolk all financial details that they believed were beyond their grasp. Whenever business went badly, the women's allowances would be cut, but never with an explanation. The women resented this, but there was nothing they could do. The men were making the money, and were their benefactors.

Babette's position was particularly unhappy. Max Stettheimer was a stolid but colorless man, moody and uncommunicative, and such life as they had together was passed in a kind of upholstered silence. Max, apparently, was fond of sitting. In letters of the time, whenever reference is made to Max—and there are very few—it is with the comment, “Max sat there.” There is a possibility that he was not very bright. Max and his father were importers by training and tradition. Buying and selling goods was a process Max understood. But the intricacies of finance—factoring, bond-selling, moneylending—eluded him. Early in his marriage to Babette, Joseph had placed Max in the St. Louis store, where he had worked with William. But now, nearly twenty years later, when Joseph was ready to abandon storekeeping altogether and go into international banking, Max dug in his heels. Joseph's plan was to send Max to Paris with William. But Max did not want to go to Paris, or into banking, or to work with William.

Taking Max's side was Max's father, Jacob Stettheimer, who had joined the Seligman enterprises when his son married into the clan, and adding her support to the Stettheimer faction was Jacob Stettheimer's wife. The senior Mrs. Stettheimer was jealous of the
Seligmans, and disapproved of the way Babette was raising her children. And so Joseph tried to move forward with his grand design, while all the Stettheimers lined up against all the Seligmans.

The situation grew stickier daily. At home Max complained to Babette that her brother was “against” him, was trying to “lord it” over him, and “wants to push me around.” Babette tried to intercede with Joseph on her husband's behalf, and Joseph explained to Babette that if she had any loyalty to her family she would get Max—and Max's father—to do as they were told. “After all, we have made Max a rich man,” he reminded his sister.

Unwisely, Babette carried this message back to Max, who thereupon presented Joseph with an ultimatum. If he and his father were not allowed to continue their importing business unhampered by Joseph, they would leave Joseph's organization altogether. Max then told Babette that if he and the Seligmans parted company he would never permit her to see any of her brothers and sisters—who were her whole life—again. In desperation, Joseph turned to William for help, writing:

Max insists that we go into importing again. And if we do not enter into it as largely as of old he will get other partners. Nothing would please me more, were it not for our dear Babette who says as soon as Max ceases business connections with us, she will face a life more insupportable than hitherto, and begs of me to try to keep him in. If only for her sake I deem it my duty, provided I cannot place him in Paris or Frankfurt as I would prefer, to commence importing again.

William had a practical suggestion. The dispute, he hinted, might be settled in some other area—specifically the money area. Sure enough, Max had his price, and so did Jacob. A sum was given to Jacob—enough to establish him in an importing business of his own. Another sum, in the form of a larger share of the business, went to Max, who, in turn, agreed to join Henry in Frankfurt. As another concession to Max, and to please Babette, Joseph agreed to change the name of the Frankfurt house to Seligman & Stettheimer and to let Max engage in importing and exporting on the side. It would not be true, of course, to say that this made everybody happy. It was a makeshift arrangement, costly to Joseph and one which Max had accepted only grumblingly.

At the same time, Joseph was trying to cope with a different family problem in San Francisco. He had long realized that artistic Leopold needed a firm hand to guide him. He had assumed that in the West Coast office Abraham would provide this. But it soon turned out that
this was not to be the case. Neither Abraham nor Leopold seemed to know what he was doing. While Leopold daydreamed over his sketch pad, Abraham—who at least undertook every project with great enthusiasm—embarked upon a long series of bungling, lightheaded, and expensive mistakes. An incompetent brother-in-law was bad enough, but to have two blood brothers who were no good at banking was inconceivable.