Chapter XLI: The Stock Exchange (1)

The Kingdom of Change Alley--A William III. Reuter--Stock Exchange
Tricks--Bulls and Bears--Thomas Guy, the Hospital Founder--Sir John
Barnard, the "Great Commoner"--Sampson Gideon, the famous Jew
Broker--Alexander Fordyce--A cruel Quaker Criticism--Stockbrokers
and Longevity--The Stock Exchange in 1795--The Money Articles in the
London Papers--The Case of Benjamin Walsh, M.P.--The De Berenger
Conspiracy--Lord Cochrane unjustly accused--"Ticket
Pocketing"--System of Business at the Stock Exchange--"Popgun
John"--Nathan Rothschild--Secrecy of his Operations--Rothschild
outdone by Stratagem--Grotesque Sketch of Rothschild--Abraham
Goldsmid--Vicissitudes of the Stock Exchange--The Spanish Panic of
1835--The Railway Mania--Ricardo's Golden Rules--A Clerical Intruder
in Capel Court--Amusements of Stockbrokers--Laws of the Stock
Exchange--The Pigeon Express--The "Alley Man"--Purchase of
Stock--Eminent Members of the Stock Exchange.

The Royal Exchange, in the reign of William III., being found vexatiously thronged, the money-dealers, in 1698, betook themselves to Change Alley, then an unappropriated area. A writer of the period says:--"The centre of jobbing is in the kingdom of 'Change Alley. You may go over its limits in about a minute and a half. Stepping out of Jonathan's into the Alley, you turn your face full south; moving on a few paces, and then turning to the east, you advance to Garraway's; from thence, going out at the other door, you go on, still east, into Birchin Lane; and then, halting at the Sword-blade Bank, you immediately face to the north, enter Cornhill, visit two or three petty provinces there on your way to the west; and thus, having boxed your compass, and sailed round the stock-jobbing globe, you turn into Jonathan's again."

Sir Henry Furnese, a Bank director, was the Reuter of those times. He paid for constant despatches from Holland, Flanders, France, and Germany. His early intelligence of every battle, and especially of the fall of Namur, swelled his profits amazingly. King William gave him a diamond ring as a reward for early information; yet he condescended to fabricate news, and his plans for influencing the funds were probably the types of similar modern tricks. If Furnese wished to buy, his brokers looked gloomy; and, the alarm spread, completed their bargains. In this manner prices were lowered four or five per cent. in a few hours. The Jew Medina, we are assured, granted Marlborough an annuity of L6,000 for permission to attend his campaigns, and amply repaid himself by the use of the early intelligence he obtained.

When, in 1715, says "Aleph," the Pretender landed in Scotland, after the dispersion of his forces, a carriage and six was seen in the road near Perth, apparently destined for London. Letters reached the metropolis announcing the capture of the discomfited Stuart; the funds rose, and a large profit was realised by the trick. Stock-jobbers must have been highly prosperous at that period, as a Quaker, named Quare, a watchmaker of celebrity, who had made a large fortune by money speculations, had for his guests at his daughter's wedding-feast the famous Duchess of Marlborough and the Princess of Wales, who attended with 300 quality visitors.

During the struggle between the old and new East India Companies, boroughs were sold openly in the Alley to their respective partisans; and in 1720 Parliamentary seats came to market there as commonly as lottery tickets. Towards the close of Anne's reign, a well-dressed horseman rode furiously down the Queen's Road, loudly proclaiming her Majesty's demise. The hoax answered, the funds falling with ominous alacrity; but it was observed, that while the Christian jobbers kept aloof, Sir Manasseh Lopez and the Hebrew brokers bought readily at the reduced rate.

The following extracts from Cibber's play of _The Refusal; or, the Ladies' Philosophy_, produced in 1720, show the antiquity of the terms "bull" and "bear." This comedy abounds in allusions to the doings in 'Change Alley, and one of the characters, Sir Gilbert Wrangle, is a South Sea director:--

_Granger_ (_to Witling, who has been boasting of his gain_): And all
this out of 'Change Alley?

_Witling:_ Every shilling, sir; all out of stocks, puts, bulls,
shams, bears and bubbles.

And again:--

There (in the Alley) you'll see a duke dangling after a director;
here a peer and a 'prentice haggling for an eighth; there a Jew and
a parson making up differences; there a young woman of quality
buying bears of a Quaker; and there an old one selling refusals to a
lieutenant of grenadiers.

The following is from an old paper, dated July 15th, 1773: "Yesterday the brokers and others at 'New Jonathan's' came to a resolution, that instead of its being called 'New Jonathan's,' it should be called 'The Stock Exchange,' which is to be wrote over the door. The brokers then collected sixpence each, and christened the House with punch."

One of the great stockbrokers of Queen Anne's reign was Thomas Guy, the founder of one of the noblest hospitals in the world, who died in 1724. He was the son of a lighterman, and for many years stood behind a counter and sold books. Acquiring a small amount of ready cash, he was tempted to employ it in Change Alley; it turned to excellent account, and soon led him to a far more profitable traffic in those tickets with which, from the time of Charles II., our seamen were remunerated. They were paid in paper, not readily convertible, and were forced to part with their wages at any discount which it pleased the money-lenders to fix. Guy made large purchases in these tickets at an immense reduction, and by such not very creditable means, with some windfalls during the South Sea agitation, he realised a fortune of L500,000. Half a million was then almost a fabulous sum, and it was constantly increasing, owing to his penurious habits. He died at the age of eighty-one, leaving by will L240,000 to the hospital which bears his name. His body lay in state at Mercers' Chapel, and was interred in the asylum he raised, where, ten years after his death, a statue was erected to his memory.

Sir John Barnard, a great opponent of stockbrokers, proposed, in 1737, to reduce the interest on the National Debt from four to three per cent., the public being at liberty to receive their principal in full if they preferred. This anticipation of a modern financial change was not adopted. At this period, L10,000,000 were held by foreigners in British funds. In 1750, the reduction from four to three per cent. interest on the funded debt was effected, and though much clamour followed, no reasonable ground for complaint was alleged, as the measure was very cautiously carried out. Sir John Barnard, the Peel of a bygone age, was commonly denominated the "great commoner." Of the stock-jobbers he always spoke with supreme contempt; in return, they hated him most cordially. On the money market it was not unusual to hear the merchants inquire, "What does Sir John say to this? What is Sir John's opinion?" He refused the post of Chancellor of the Exchequer in 1746, and from the moment his statue was set up in Gresham's Exchange he would never enter the building, but carried on his monetary affairs outside. The Barnard blood still warms the veins of some of our wealthiest commercial magnates, since his son married the daughter of a capitalist, known in the City as "the great banker, Sir John Hankey."

Sampson Gideon, the famous Jew broker, died in 1762. Some of his shrewd sayings are preserved. Take a specimen: "Never grant a life annuity to an old woman; they wither, but they never die." If the proposed annuitant coughed, Gideon called out, "Ay, ay, you may cough, but it shan't save you six months' purchase!" In one of his dealings with Snow, a banker alluded to by Dean Swift, Snow lent Gideon L20,000. The "Forty-five" followed, and the banker forwarded a whining epistle to him speaking of stoppage, bankruptcy, and concluding the letter with a passionate request for his money. Gideon procured 21,000 bank-notes, rolled them round a phial of hartshorn, and thus mockingly repaid the loan. Gideon's fortune was made by the advance of the rebels towards London. Stocks fell awfully, but hastening to "Jonathan's," he bought all in the market, spending all his cash, and pledging his name for more. The Pretender retreated, and the sagacious Hebrew became a millionaire. Mr. Gideon had a sovereign contempt for fine clothes; an essayist of the day writes, "Neither Guy nor Gideon ever regarded dress." He educated his children in the Christian faith; "but," said he, "I'm too old to change." "Gideon is dead," says one of his biographers, "worth more than the whole land of Canaan. He has left the reversion of all his milk and honey--after his son and daughter, and their children--to the Duke of Devonshire, without insisting on his assuming his name, or being circumcised!" His views must have been liberal, for he left a legacy of L2,000 to the Sons of the Clergy, and of L1,000 to the London Hospital. He also gave L1,000 to the synagogue, on condition of having his remains interred in the Jewish burying-place.

In 1772, the occurrence of some Scotch failures led to a Change-Alley panic, and the downfall of Alexander Fordyce, who, for years, had been the most thriving jobber in London. He was a hosier in Aberdeen, but came to London to improve his fortunes. The money game was in his favour. He was soon able to purchase a large estate. He built a church at his private cost, and spent thousands in trying to obtain a seat in Parliament. Marrying a lady of title, on whom he made a liberal settlement, he bought several Scotch lairdships, endowed an hospital, and founded several charities. But the lease of his property was short. His speculations suddenly grew desperate; hopeless ruin ensued; and a great number of capitalists were involved in his fall. The consternation was extreme, nor can we wonder, since his bills, to the amount of L4,000,000, were in circulation. He earnestly sought, but in vain, for pecuniary aid. The Bank refused it, and when he applied for help to a wealthy Quaker, "Friend Fordyce," was the answer, "I have known many men ruined by _two dice_, but I will not be ruined by _Four-dice_."

In 1785, a stockbroker, named Atkinson, probably from the "North Countree," speculated enormously, but skilfully, we must suppose, for he realised a fortune of L500,000. His habits were eccentric. At a friend's dinner party he abruptly turned to a lady who occupied the next chair, saying, "If you, madam, will entrust me with L1,000 for three years, I will employ it advantageously." The speaker was well known, and his offer accepted; and at the end of the three years, to the very day, Atkinson called on the lady with L10,000, to which, by his adroit management, her deposit had increased.

In general (says "Aleph," in the _City Press_), a stock-jobber's pursuits tend to shorten life; violent excitement, and the constant alternation of hope and fear, wear out the brain, and soon lead to disease or death. Yet instances of great longevity occur in this class: John Rive, after many active years in the Alley, retired to the Continent, and died at the age of 118.

The author of "The Bank Mirror" (circa 1795) gives a graphic description of the Stock Exchange of that period. "The scene opens," he says, "about twelve, with the call of the prices of stock, the shouting out of names, the recital of news, &c., much in the following manner:--'A mail come in--What news? what news?--Steady, steady--Consols for to-morrow--Here, Consols!--You old Timber-toe, have you got any scrip?--Private advices from--A wicked old peer in disguise sold--What do you do?--Here, Consols! Consols!--Letters from--A great house has stopt--Payment of the Five per Cents commences--Across the Rhine--The Austrians routed--The French pursuing!--Four per Cents for the opening!--Four per Cents--Sir Sydney Smith exchanged for--Short Annuities--Shorts! Shorts! Shorts!--A messenger extraordinary sent to--Gibraltar fortifying against--A Spanish fleet seen in--Reduced Annuities for to-morrow--I'm a seller of--Lame ducks waddling--Under a cloud hanging over--The Cape of Good Hope retaken by--Lottery tickets!--Here, tickets! tickets! tickets!--The Archduke Charles of Austria fled into--India Stock!--Clear the way, there, Moses!--Reduced Annuities for money!--I'm a buyer--Reduced! Reduced! (_Rattles spring._) What a d----d noise you make there with the rattles!--Five per Cents!--I'm a seller!--Five per Cents! Five per Cents!--The French in full march for--The Pope on his knees--following the direction of his native meekness into--Consols! Consols!--Smoke the old girl in silk shoes there! Madam, do you want a broker?--Four per Cents--The Dutch fleet skulked into--Short Annuities!--The French army retreating!--The Austrians pursuing!--Consols! Consols! Bravo!--Who's afraid?--Up they go! up they go!--'De Empress de Russia dead!'--You lie, Mordecai! I'll stuff your mouth with pork, you dog!--Long Annuities! Long Annuities! Knock that fellow's hat off, there!--He'll waddle, to-morrow--Here, Long Annuities! Short Annuities--Longs and Shorts!--The Prince of Conde fled!--Consols!--The French bombarding Frankfort!--Reduced Annuities--Down they go! down they go!--You, Levi, you're a thief, and I'm a gentleman--Step to Garraway's, and bid Isaacs come here--Bank Stock!--Consols!--Give me thy hand, Solomon!--Didst thou not hear the guns fire?--Noble news! great news!--Here, Consols! St. Lucia taken!--St. Vincent taken!--French fleets blocked up! English fleets triumphant! Bravo! Up we go! up, up, up!--Imperial Annuities! Imperial! Imperial!--Get out of my sunshine, Moses, you d--d little Israelite!--Consols! Consols! &c.' ... The noise of the screech-owl, the howling of the wolf, the barking of the mastiff, the grunting of the hog, the braying of the ass, the nocturnal wooing of the cat, the hissing of the snake, the croaking of toads, frogs, and grasshoppers--all these in unison could not be more hideous than the noise which these beings make in the Stock Exchange. And as several of them get into the Bank, the beadles are provided with rattles, which they occasionally spring, to drown their noise and give the fair purchaser or seller room and opportunity to transact their business; for that part of the Rotunda to which the avenue from Bartholomew Lane leads is often so crowded with them that people cannot enter."

About 1799, the shares of this old Stock Exchange having fallen into few hands, they boldly attempted, instead of a sixpenny diurnal admission to every person presenting himself at the bar, to make it a close subscription-room of ten guineas per annum for each member, and thereby to shut out all petty or irregular traffickers, to increase the revenues of this their monopolised market. A violent democracy revolted at this imposition and invasion of the rights, privileges, and immunities of a public market for the public stock. They proposed to raise 263 shares of L50 each, creating a fund of L13,150 wherewith to build a new, uninfluenced, unaristocraticised, free, open market. Those shares were never, as in the old conventicle, to condense into a few hands, for fear of a dread aristocracy returning. Mendoza's boxing-room, the debating-forum up Capel Court, and buildings contiguous with the freehold site, were purchased, and the foundation-stone was laid for this temple, to be, when completed, consecrated to free, open traffic.

In 1805 Ambrose Charles, a Bank clerk, publicly charged the Earl of Moira, a cabinet minister, with using official intelligence to aid him in speculating in the funds. The Premier was compelled to investigate the charge, but no truthful evidence could be adduced, and the falsehood of his allegations was made apparent.

Mark Sprat, a remarkable speculator, died in 1808. He came to London with small means, but getting an introduction to the Stock Exchange, was wonderfully successful. In 1799 he contracted for the Lottery; and in 1800 and the three following years he was foremost among those who contracted for the loans. During Lord Melville's trial, he was asked whether he did not act as banker for members of both houses. "I never do business with privileged persons!" was his reply, which might have referred to the following fact:--A broker came to Sprat in great distress. He had acted largely for a principal who, the prices going against him, refused to make up his losses. "Who was the scoundrel?" "A nobleman of immense property." Sprat volunteered to go with him to his dishonest debtor. The great man coolly answered, it was not convenient to pay. The broker declared that unless the account was settled by a fixed hour next day, his lordship would be posted as a defaulter. Long before the time appointed the matter was arranged, and Sprat's friend rescued from ruin.

The history of the money articles in the London papers is thus given by the author of "The City." In 1809 and 1810 (says the writer), the papers had commenced regularly to publish the prices of Consols and the other securities then in the market, but the list was merely furnished by a stockbroker, who was allowed, as a privilege for his services, to append his name and address, thereby receiving the advantages of an advertisement without having to pay for it. A further improvement was effected by inserting small paragraphs, giving an outline of events occurring in relation to City matters, but these occupied no acknowledged position, and only existed as ordinary intelligence. However, from 1810 up to 1817, considerable changes took place in the arrangements of the several daily journals; and a new era almost commenced in City life with the numerous companies started on the joint-stock principle at the more advanced period, and then it was that this department appears to have received serious attention from the heads of the leading journals.

The description of matter comprised in City articles has not been known in its present form more than fifty years. There seems a doubt whether they first originated with the _Times_ or the _Herald_. Opinion is by some parties given in favour of the last-mentioned paper. Whichever establishment may be entitled to the praise for commencing so useful a compendium of City news, one thing appears very certain--viz., that no sooner was it adopted by the one paper, than the other followed closely in the line chalked out. The regular City article appears only to have had existence since 1824-25, when the first effect of that over-speculating period was felt in the insolvency of public companies, and the breakage of banks. Contributions of this description had been made and published, as already noticed, in separate paragraphs throughout the papers as early as 1811 and 1812; but these took no very prominent position till the more important period of the close of the war, and the declaration of peace with Europe.

In 1811, the case of Benjamin Walsh, M.P., a member of the Stock Exchange, occasioned a prodigious sensation. Sir Thomas Plomer employed him as his broker, and, buying an estate, found it necessary to sell stock. Walsh advised him not to sell directly, as the funds were rising; the deeds were not prepared, and the advice was accepted. Soon after, Walsh said the time to sell was come, for the funds would quickly fall. The money being realised, Walsh recommended the purchase of exchequer bills as a good investment. Till the cash was wanted, Sir Thomas gave a cheque for L22,000 to Walsh, who undertook to lodge the notes at Gosling's. In the evening he brought an acknowledgment for L6,000, promising to make up the amount next day. Sir Thomas called at his bankers, and found that a cheque for L16,000 had been sent, but too late for presentation, and in the morning the cheque was refused. In fact, Walsh had disposed of the whole; giving L1,000 to his broker, purchasing L11,000 of American stock, and buying L5,000 worth of Portuguese doubloons. He was tried and declared guilty; but certain legal difficulties were interposed; the judges gave a favourable decision; he was released from Newgate, and formally expelled from the House of Commons. Such crimes seem almost incredible, for such culprits can have no chance of escape; as, even when the verdict of a jury is favourable, their character and position must be absolutely and hopelessly lost.

In these comparatively steady-going times, the funds often remain for months with little or no variation; but during the last years of the French war, a difference of eight or even ten per cent. might happen in an hour, and scripholders might realise eighteen or twenty per cent. by the change in the loans they so eagerly sought. From what a fearful load of ever-increasing expenditure the nation was relieved by the peace resulting from the battle of Waterloo, may be judged from the fact that the decrease of Government charges was at once declared to exceed L2,000,000 per month.

One of the most extraordinary Stock Exchange conspiracies ever devised was that carried out by De Berenger and Cochrane Johnstone in 1814. It was a time when Bonaparte's military operations against the allies had depressed the funds, and great national anxiety prevailed. The conspiracy was dramatically carried out. On the 21st of February, 1824, about one a.m., a violent knocking was heard at the door of the "Ship Inn," then the principal hotel of Dover. On the door being opened, a person in richly embroidered scarlet uniform, wet with spray, announced himself as Lieutenant-Colonel De Bourg, aide-de-camp of Lord Cathcart. He had a star and silver medals on his breast, and wore a dark fur travelling cap, banded with gold. He said he had been brought over by a French vessel from Calais, the master of which, afraid of touching at Dover, had landed him about two miles off, along the coast. He was the bearer of important news--the allies had gained a great victory and had entered Paris. Bonaparte had been overtaken by a detachment of Sachen's Cossacks, who had slain and cut him into a thousand pieces. General Platoff had saved Paris from being reduced to ashes. The white cockade was worn everywhere, and an immediate peace was now certain. He immediately ordered out a post-chaise and four, but first wrote the news to Admiral Foley, the port-admiral at Deal. The letter reached the admiral about four a.m., but the morning proving foggy, the telegraph would not work. Off dashed De Bourg (really De Berenger, an adventurer, afterwards a livery-stable keeper), throwing napoleons to the post-boys every time he changed horses. At Bexley Heath, finding the telegraph could not have worked, he moderated his pace and spread the news of the Cossacks fighting for Napoleon's body. At the Marsh Gate, Lambeth, he entered a hackney coach, telling the post-boys to spread the news on their return. By a little after ten, the rumours reached the Stock Exchange, and the funds rose; but on its being found that the Lord Mayor had had no intelligence, they soon went down again.

In the meantime other artful confederates were at work. The same day, about an hour before daylight, two men, dressed as foreigners, landed from a six-oar galley, and called on a gentleman of Northfleet, and handed him a letter from an old friend, begging him to take the bearers to London, as they had great public news to communicate; they were accordingly taken. About twelve or one the same afternoon, three persons (two of whom were dressed as French officers) drove slowly over London Bridge in a post-chaise, the horses of which were bedecked with laurel. The officers scattered billets to the crowd, announcing the death of Napoleon and the fall of Paris. They then paraded through Cheapside and Fleet Street, passed over Blackfriars Bridge, drove rapidly to the Marsh Gate, Lambeth, got out, changed their cocked hats for round ones, and disappeared as De Bourg had done.

The funds once more rose, and long bargains were made; but still some doubt was felt by the less sanguine, as the ministers as yet denied all knowledge of the news. Hour after hour passed by, and the certainty of the falsity of the news gradually developed itself. "To these scenes of joy," says a witness, "and of greedy expectations of gain, succeeded, in a few hours, disappointment and shame at having been gulled, the clenching of fists, the grinding of teeth, the tearing of hair, all the outward and visible signs of those inward commotions of disappointed avarice in some, consciousness of ruin in others, and in all boiling revenge." A committee was appointed by the Stock Exchange to track out the conspiracy, as on the two days before Consols and Omnium, to the amount of L826,000, had been purchased by persons implicated. Because one of the gang had for a blind called on the celebrated Lord Cochrane, and because a relation of his engaged in the affair had purchased Consols for him, that he might unconsciously benefit by the fraud, the Tories, eager to destroy a bitter political enemy, concentrated all their rage on as high-minded, pure, and chivalrous a man as ever trod a frigate's deck. He was tried June 21, 1817, at the Court of Queen's Bench, fined L1,000, and sentenced ignominiously to stand one hour in the pillory. This latter part of his sentence the Government was, however, afraid to carry out, as Sir Francis Burdett had declared that if it was done, he would stand beside his friend on the scaffold of shame. To crown all, Cochrane's political enemies had him stripped of his knighthood, and the escutcheon of his order disgracefully kicked down the steps of the chapel in Westminster Abbey. For some years this true successor of Nelson remained a branded exile, devoting his courage to the cause of universal liberty, lost to the country which he loved so much. In his old age tardy justice restored to him his unsoiled coronet, and finally awarded him a grave among her heroes.

The ticket pocketing of 1821 is thus described by the author of "An Expose of the Mysteries of the Stock Exchange:"--"Of all the tricks," he says, "practised against Goldschmidt, the ticket pocketing scheme was, perhaps, the most iniquitous: it was to prevent the buying in on a settling day the balance of the account, and to defeat the consequent rise, thereby making the real bear a fictitious bull account. To give the reader a conception of this, and of the practices as well as the interior of the Stock Exchange, the following attempted delineation is submitted:--The doors open before ten, and at the minute of ten the spirit-stirring rattle grates to action. Consols are, suppose, 69 to 69-1/8--that is, buyers at the lower and sellers at the higher price. Trifling manoeuvres and puffing up till twelve, as neither party wish the Government broker to buy under the highest price; the sinking-fund purchaser being the point of diurnal altitude, as the period before a loan is the annually depressed point of price, when the Stock Exchange have the orbit of these revolutions under their own control.

"At twelve the broker mounts the rostrum and opens: 'Gentlemen, I am a buyer of L60,000 Consols for Government, at 69.' 'At 1/8th, sir,' the jobbers resound; 'ten thousand of me--five of me--two of me,' holding up as many fingers. Nathan, Goldschmidt's agent, says, 'You may have them all of me at your own bidding, 69.' In ten minutes this commission is earned from the public, and this state sinking-fund joint stock jobbed. Nathan is hustled, his hat and wig thrown upon the commissioner's sounding-board, and he must stand bareheaded until the porter can bring a ladder to get it down. Out squalls a ticket-carrier, 'Done at 7/8;' again, 'At 3/4, all a-going;' and the contractors must go, too; they have served the commissioners at 69, when the market was full one-eighth. All must come to market before next omnium payment; they cannot keep it up (yet this operation might have suited the positions of the market). Nathan cries out, 'Where done at 3/4ths?' 'Here--there, there, there!' Mr. Doubleface, going out at the door, meets Mr. Ambush, a brother bear, with a wink, 'Sir, they are 3/4ths, I believe, sellers; you may have L2,000 thereat, and L10,000 at 5/8ths.' This is called fiddling: it is allowable to jobbers thus to bring the turn to 1/16th, or a 32nd, but not to brokers, as thereby the public would not be fleeced 1/8th, to the house benefit. 'Sir, I would not take them at 1/4th,' replies Mr. Ambush. 'Offered at 3/4ths and 5/8ths,' bawls out an urchin scout, holding up his face to the ceiling, that by the re-echo his spot may not be discovered."

The system of business at the Stock Exchange is thus described by an accomplished writer on the subject: "Bargains are made in the presence of a third person. The terms are simply entered in a pocket-book, but are checked the next day; and the jobber's clerk (also a member of the house) pays or receives the money, and sees that the securities are correct. There are but three or four dealers in Exchequer bills. Most members of the Stock Exchange keep their money in convertible securities, so that it can be changed from hand to hand almost at a moment's notice. The brokers execute the orders of bankers, merchants, and private individuals; and the jobbers are the persons with whom they deal. When the broker appears in the market, he is at once surrounded by eager jobbers. One of the cries of the Stock Exchange is, 'Borrow money? borrow money?'--a singular cry to general apprehension, but it of course implies that the credit of the borrower must be first-rate, or his security of the most satisfactory nature, and that it is not the principal who goes into the market, but only the principal's broker. 'Have you money to lend to-day?' is a startling question often asked with perfect _nonchalance_ in the Stock Exchange. If the answer is 'Yes,' the borrower says, 'I want L10,000 or L20,000.'--'At what security?' is the vital question that soon follows.

"Another mode of doing business is to conceal the object of the borrower or lender, who asks, 'What are Exchequer?' The answer may be, 'Forty and forty-two.' That is, the party addressed will buy L1,000 at 40 shillings, and sell L1,000 at 42 shillings. The jobbers cluster round the broker, who perhaps says, 'I must have a price in L5,000.' If it suits them, they will say, 'Five with me,' 'Five with me,' 'Five with me,' making fifteen; or they will say, 'Ten with me;' and it is the broker's business to get these parties pledged to buy of him at 40, or to sell to him at 42, they not knowing whether he is a buyer or a seller. The broker then declares his purpose, saying, for example, 'Gentlemen, I sell to you L20,000 at 40;' and the sum is then apportioned among them. If the money were wanted only for a month, and the Exchequer market remained the same during the time, the buyer would have to give 42 in the market for what he sold at 40, being the difference between the buying and the selling price, besides which he would have to pay the broker 1s. per cent. commission on the sale, and 1s. per cent. on the purchase, again on the bills, which would make altogether 4s. per cent. If the object of the broker be to buy Consols, the jobber offers to buy his L10,000 at 96, or to sell him that amount at 96-1/8, without being at all aware which he is engaging himself to do. The same person may not know on any particular day whether he will be a borrower or a lender. If he has sold stock, and has not re-purchased about one or two o'clock in the day, he would be a lender of money; but if he has bought stock, and not sold, he would be a borrower. Immense sums are lent on condition of being recalled on the short notice of a few hours."

The uninitiated wonder that any man should borrow L10,000 or L20,000 for a day, or at most a fortnight, when it is liable to be called for at the shortest notice. The directors of a railway company, instead of locking up their money, send the L12,000 or L14,000 a week to a broker, to be lent on proper securities. Persons who pay large duties to Government at fixed periods, lend the sums for a week or two. A person intending to lay out his capital in mortgage or real property, lends out the sum till he meets with a suitable offer. The great bankers lend their surplus cash on the Stock Exchange. A jobber, at the close of the day, will lend his money at 1 per cent., rather than not employ it at all. The extraordinary fluctuations in the rate of interest even in a single day are a great temptation to the money-lender to resort to the Stock Exchange. "Instances have occurred," says our authority, "when in the morning everybody has been anxious to lend money at 4 per cent., when about two o'clock money has become so scarce that it could with difficulty be borrowed at 10 per cent. If the price of Consols be low, persons who are desirous of raising money will give a high rate of interest rather than sell stock."

The famous Pop-gun Plot was generally supposed to have been a Stock Exchange trick. A writer on stockbroking says: "The Pop-gun Plot, in Palace Yard, on a memorable occasion of the King going to the Parliament House, was never understood or traced home. It is said to have originated in a Stock Exchange hoax. 'Popgun John' was at the time a low republican in the Stock Exchange, and had a house in or near Palace Yard, from which a missile had been projected. He subsequently grew rich."

The journals of that day described the hot pursuit by the myrmidons being cooled by a well-got-up story that the fugitive suspected had been unfortunately drowned; and in proof, a hat picked up by a waterman at the Nore was brought wet to the police office, and proved to have belonged to the person pursued. The plotter disappeared after this "drowning" for some months, while the hush-money and sinister manoeuvres were baffling the pursuers. Afterwards, the affair dying away, he reappeared, resuscitated, in the Stock Exchange, making very little secret of this extraordinary affair, and would relate it in ordinary conversation on the Stock Exchange benches, as a philosophical experiment, not intended to endanger the king's life, but certainly planned to frighten the public, so as to effect a fall, and realise a profitable bear account; if sufficient to trip up the contractors, the better.

While the dupes of the Cato Street conspiracy were dangling before the "debtor's door," the surviving adept of the former plot, from his villa not ten miles from London, was mounting his carriage to drive to the Stock Exchange, to operate upon the effect this example might produce in the public mind, and, consequently, realising his now large portion of funded property.

"If there are any members now of that standing in the Stock Exchange, they must remember how artlessly the tale of this philosophical experiment used to be told by the contriver of it in a year or two afterwards, in reliance upon Stock Exchange men's honour and confidence.

In the year 1798, Nathan, the third son of Meyer Anselm Rothschild, of Frankfort, intimated to his father that he would go to England, and there commence business. The father knew the intrepidity of Nathan, and had great confidence in his financial skill: he interposed, therefore, no difficulties. The plan was proposed on Tuesday, and on Thursday it was put into execution.

Nathan was entrusted with L20,000, and though perfectly ignorant of the English language, he commenced a most gigantic career, so that in a brief period the above sum increased to the amount of L60,000. Manchester was his starting-point. He took a comprehensive survey of its products, and observed that by proper management a treble harvest might be reaped from them. He secured the three profitable trades in his grasp--viz., the raw material, the dyeing, and the manufacturing--and was consequently able to sell goods cheaper than any one else. His profits were immense, and Manchester soon became too little for his speculative mind. Nevertheless, he would not have left it were it not a private pique against one of his co-religionists, which originated by the dishonouring of a bill which was made payable to him, disgusted him with the Manchester community. In 1800, therefore, he quitted Manchester for the metropolis. With giant strides he progressed in his prosperity. The confused and insecure state of the Continent added to his fortune, and contributed to his fame.

The Prince of Hesse Cassel, in flying from the approach of the republican armies, desired, as he passed through Frankfort, to store a vast amount of wealth, in such a manner as might leave him a chance of recovery after the storm had passed by. He sought out Meyer Anselm Rothschild, and confided all his worldly possessions to the keeping of the Hebrew banker. Meyer Anselm, either from fear of loss or hope of gain, sent the money to his son Nathan, settled in London, and the latter thus alluded to this circumstance: "The Prince of Hesse Cassel gave my father his money; there was no time to be lost; he sent it to me. I had L600,000 arrive by post unexpectedly; and I put it to so good use, that the prince made me a present of all his wine and linen."

"When the late Mr. Rothschild was alive, if business," says the author of "The City," "ever became flat and unprofitable in the Stock Exchange, the brokers and jobbers generally complained, and threw the blame upon this leviathan of the money market. Whatever was wrong, was always alleged to be the effects of Mr. Rothschild's operations, and, according to the views of these parties, he was either bolstering up, or unnecessarily depressing prices for his own object. An anecdote is related of this great speculator, that hearing on one occasion that a broker had given very strong expression to his feelings in the open market on this subject, dealing out the most deadly anathemas against the Jews, and consigning them to the most horrible torments, he sent the broker, through the medium of another party, an order to sell L600,000 Consols, saying, 'As he always so abuses me, they will never suspect he is _bearing_ the market on my account.' Mr. Rothschild employed several brokers to do his business, and hence there was no ascertaining what in reality was the tendency of his operations. While perchance one broker was buying a certain quantity of stock on the order of his principal in the market, another at the same moment would be instructed to sell; so that it was only in the breast of the principal to know the probable result. It is said that Mrs. Rothschild tried her hand in speculating, and endeavoured by all her influence to get at the secret of her husband's dealings. She, however, failed, and was therefore not very successful in her ventures. Long before Mr. Rothschild's death, it was prophesied by many of the brokers that, when the event occurred, the public would be less alarmed at the influence of the firm, and come forward more boldly to engage in stock business. They have, notwithstanding, been very much mistaken."

The chronicler of the "Stock Exchange" says: "One cause of Rothschild's success, was the secrecy with which he shrouded all his transactions, and the tortuous policy with which he misled those the most who watched him the keenest. If he possessed news calculated to make the funds rise, he would commission the broker who acted on his behalf to sell half a million. The shoal of men who usually follow the movements of others, sold with him. The news soon passed through Capel Court that Rothschild was bearing the market, and the funds fell. Men looked doubtingly at one another; a general panic spread; bad news was looked for; and these united agencies sunk the price two or three per cent. This was the result expected; other brokers, not usually employed by him, bought all they could at the reduced rate. By the time this was accomplished the good news had arrived; the pressure ceased, the funds arose instantly, and Mr. Rothschild reaped his reward."

It sometimes happened that notwithstanding Rothschild's profound secrecy, he was overcome by stratagem. The following circumstance, which was related to Mr. Margoliouth by a person who knew Rothschild well, will illustrate the above statement. When the Hebrew financier lived at Stamford Hill, there resided opposite to him another very wealthy dealer in the Stock Exchange, Lucas by name. The latter returning home one night at a late hour from a convivial party, observed a carriage and four standing before Rothschild's gate, upon which he ordered his own carriage out of the way, and commanded his coachman to await in readiness his return. Lucas went stealthily and watched, unobserved, the movements at Rothschild's gate. He did not lie long in ambush before he heard some one leaving the Hebrew millionaire's mansion, and going towards the carriage. He saw Rothschild, accompanied by two muffled figures, step into the carriage, and heard the word of command, "To the City." He followed Rothschild's carriage very closely, but when he reached the top of the street in which Rothschild's office was situated, Lucas ordered his carriage to stop, from which he stepped out, and proceeded, reeling to and fro through the street, feigning to be mortally drunk. He made his way in the same mood as far as Rothschild's office, and _sans ceremonie_ opened the door, to the great consternation and terror of the housekeeper, uttering sundry ejaculations in the broken accents of Bacchus' votaries. Heedless of the affrighted housekeeper's remonstrances, he opened Rothschild's private office, in the same staggering attitude, and fell down flat on the floor.

Rothschild and his friends became very much alarmed. Efforts were made to restore and remove the would-be drunkard, but Lucas was too good an actor, and was therefore in such a fit as to be unable to be moved hither or thither. "Should a physician be sent for?" asked Rothschild. But the housekeeper threw some cold water into Lucas's face, and the patient began to breathe a little more naturally, and fell into a sound snoring sleep. He was covered over, and Rothschild and the strangers proceeded unsuspectingly to business. The strangers brought the good intelligence that the affairs in Spain were all right, respecting which the members of the Exchange were, for a few days previous, very apprehensive, and the funds were therefore in a rapidly sinking condition. The good news could not, however, in the common course of despatch, be publicly known for another day. Rothschild therefore planned to order his brokers to buy up, cautiously, all the stock that should be in the market by twelve o'clock the following day. He sent for his principal broker thus early, in order to entrust him with the important instruction.

The broker was rather tardier than Rothschild's patience could brook; he therefore determined to go himself. As soon as Rothschild was gone, Lucas began to recover, and by degrees was able to get up, though distracted, as he said, "with a violent headache," and insisted, in spite of the housekeeper's expostulations, upon going home. But Lucas went to his broker, and instructed him to buy up all the stock he could get by ten o'clock the following morning. About eleven o'clock Lucas met Rothschild, and inquired satirically how he, Rothschild, was off for stock. Lucas won the day, and Rothschild is said never to have forgiven "the base, dishonest, and nefarious stratagem."

Yet, with all his hoardings, says Mr. Margoliouth, Rothschild was by no means a happy man. Dangers and assassinations seemed to haunt his imagination by day and by night, and not without grounds. Many a time, as he himself said, just before he sat down to dinner, a note would be put into his hand, running thus:--"If you do not send me immediately the sum of five hundred pounds, I will blow your brains out." He affected to despise such threats; they, nevertheless, exercised a direful effect upon the millionaire. He loaded his pistols every night before he went to bed, and put them beside him. He did not think himself more secure in his country house than he did in his bed. One day, while busily engaged in his golden occupation, two foreign gentlemen were announced as desirous to see Baron Rothschild _in propria persona_. The strangers had not the foresight to have the letters of introduction in readiness. They stood, therefore, before the Baron in the ludicrous attitude of having their eyes fixed upon the Hebrew Croesus, and with their hands rummaging in large European coat-pockets. The fervid and excited imagination of the Baron conjured up a multitudinous array of conspiracies. Fancy eclipsed his reason, and, in a fit of excitement, he seized a huge ledger, which he aimed and hurled at the mustachioed strangers, calling out, at the same time, for additional physical force. The astonished Italians, however, were not long, after that, in finding the important documents they looked for, which explained all. The Baron begged the strangers' pardon for the unintentional insult, and was heard to articulate to himself, "Poor unhappy me! a victim to nervousness and fancy's terrors! and all because of my money!"

Rothschild's mode of doing business when engaging in large transactions (says Mr. Grant) was this. Supposing he possessed exclusively, which he often did, a day or two before it could be generally known, intelligence of some event, which had occurred in any part of the Continent, sufficiently important to cause a rise in the French funds, and through them on the English funds, he would empower the brokers he usually employed to sell out stock, say to the amount of L500,000. The news spread in a moment that Rothschild was selling out, and a general alarm followed. Every one apprehended that he had received intelligence from some foreign part of some important event which would produce a fall in prices. As might, under such circumstances, be expected, all became sellers at once. This, of necessity, caused the funds, to use Stock Exchange phraseology, "to tumble down at a fearful rate." Next day, when they had fallen, perhaps, one or two per cent., he would make purchases, say to the amount of L1,500,000, taking care, however, to employ a number of brokers whom he was not in the habit of employing, and commissioning each to purchase to a certain extent, and giving all of them strict orders to preserve secrecy in the matter. Each of the persons so employed was, by this means, ignorant of the commission given to the others. Had it been known the purchases were made by him, there would have been as great and sudden a rise in the prices as there had been in the fall, so that he could not purchase to the intended extent on such advantageous terms. On the third day, perhaps, the intelligence which had been expected by the jobbers to be unfavourable arrived, and, instead of being so, turned out to be highly favourable. Prices instantaneously rise again, and possibly they may get one and a-half or even two per cent. higher than they were when he sold out his L500,000. He now sells out, at the advanced price, the entire L1,500,000 he had purchased at the reduced prices. The gains by such extensive transactions, when so skilfully managed, will be at once seen to be enormous. By the supposed transaction, assuming the rise to be two per cent., the gain would be L35,000. But this is not the greatest gain which the late leviathian of modern capitalists made by such transactions. He, on more than one occasion, made upwards of L100,000 on one account.

But though no person during the last twelve or fifteen years of Rothschild's life (says Grant) was ever able, for any length of time, to compete with him in the money market, he on several occasions was, in single transactions, outwitted by the superior tactics of others. The gentleman to whom I allude was then and is now the head of one of the largest private banking establishments in town. Abraham Montefiore, Rothschild's brother-in-law, was the principal broker to the great capitalist, and in that capacity was commissioned by the latter to negotiate with Mr. ---- a loan of L1,500,000. The security offered by Rothschild was a proportionate amount of stock in Consols, which were at that time 84. This stock was, of course, to be transferred to the name of the party advancing the money, Rothschild's object being to raise the price of Consols by carrying so large a quantity out of the market. The money was lent, and the conditions of the loan were these--that the interest on the sum advanced should be at the rate of 4-1/2 per cent., and that if the price of Consols should chance to go down to 74, Mr. ---- should have the right of claiming the stock at 70. The Jew, no doubt, laughed at what he conceived his own commercial dexterity in the transaction; but, ere long, he had abundant reason to laugh on the wrong side of his mouth; for, no sooner was the stock poured into the hand of the banker, than the latter sold it, along with an immensely large sum which had been previously standing in his name, amounting altogether to little short of L3,000,000. But even this was not all. Mr. ---- also held powers of attorney from several of the leading Scotch and English banks, as well as from various private individuals, who had large property in the funds, to sell stock on their account. On these powers of attorney he acted, and at the same time advised his friends to follow his example. They at once did so, and the consequence was that the aggregate amount of stock sold by himself and his friends conjointly exceeded L10,000,000. So unusual an extent of sales, all effected in the shortest possible time, necessarily drove down the prices. In an incredibly short time they fell to 74; immediately on which, Mr. ---- claimed of Rothschild his stock at 70. The Jew could not refuse: it was in the bond. This climax being reached, the banker bought in again all the stock he had previously sold out, and advised his friends to re-purchase also. They did so; and the result was, that in a few weeks Consols reached 84 again, their original price, and from that to 86. Rothschild's losses were very great by this transaction; but they were by no means equal to the banker's gains, which could not have been less than L300,000 or L400,000.

The following grotesque sketch of the great Rothschild is from the pen of a clever anonymous writer:--"The thing before you," says the author quoted, "stands cold, motionless, and apparently speculationless, as the pillar of salt into which the avaricious spouse of the patriarch was turned; and while you start with wonder at what it can be or mean, you pursue the association, and think upon the fire and brimstone that were rained down. It is a human being of no very Apollo-like form or face: short, squat, with its shoulders drawn up to its ears, and its hands delved into its breeches'-pockets. The hue of its face is a mixture of brick-dust and saffron; and the texture seems that of the skin of a dead frog. There is a rigidity and tension in the features, too, which would make you fancy, if you did not see that that were not the fact, that some one from behind was pinching it with a pair of hot tongs, and that it were either afraid or ashamed to tell. Eyes are usually denominated the windows of the soul; but here you would conclude that the windows are false ones, or that there is no soul to look out at them. There comes not one pencil of light from the interior, neither is there one scintillation of that which comes from without reflected in any direction. The whole puts you in mind of 'a skin to let;' and you wonder why it stands upright without at least something within. By-and-by another figure comes up to it. It then steps two paces aside, and the most inquisitive glance that ever you saw, and a glance more inquisitive than you would ever have thought of, is drawn out of the erewhile fixed and leaden eye, as if one were drawing a sword from a scabbard. The visiting figure, which has the appearance of coming by accident, and not by design, stops but a second or two, in the course of which looks are exchanged which, though you cannot translate, you feel must be of most important meaning. After these, the eyes are sheathed up again, and the figure resumes its stony posture. During the morning numbers of visitors come, all of whom meet with a similar reception, and vanish in a similar manner; and last of all the figure itself vanishes, leaving you utterly at a loss as to what can be its nature and functions."

Abraham Goldsmid, a liberal and honourable man, who almost rivalled Rothschild as a speculator, was ruined at last by a conspiracy. Goldsmid, in conjunction with a banking establishment, had taken a large Government loan. The leaguers contrived to produce from the collectors and receivers of the revenue so large an amount of floating securities--Exchequer Bills and India Bonds--that the omnium fell to 18 discount. The result was Goldsmid's failure, and eventually his suicide. The conspirators purchased omnium when at its greatest discount, and on the following day it went up to 3 premium, being then a profit of about L2,000,000.