The City of London Vol.1: A World of Its Own 1850-1890

248 Pages·1994·18.462 MB·English

by  David Kynaston

THE CITY OF
BY THE SAME AUTHOR
LONDON
King Labour: The British Working Class, r850-r9r4
The Secretary of State
The Chancellor of the Exchequer
Bobby Abel, Professional Batsman
Volume I
Archie's Last Stand: MCC in New Zealand, r922-23
The Financial Times: A Centenary History
A World of Its Own
WG's Birthday Party
Cazenave & Co: A History
1815-1890
DAVID KYNASTON
CHATTO & WINDUS
LONDON
First published in I994 This book is dedicated to Laurie and George
1 3 5 7 9 10 8 6 4 2
©David Kynaston 1994
David Kynaston has asserted his right under the Copyright,
Designs and Patents Act, I988 to be identified as the author of this work
First published
in Great Britain in 1994 by
Chatto & Windus Limited
Random House, 10 Vauxhall Bridge Road, London SWrV 1SA
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Contents
Part One Prologue
In l7II the essayist Richard Steele introduced the members of the l Outsiders 2
Spectator Club. One was Sir Andrew Freeport, 'a Merchant of great 2 The Whole Earth Emporium 9
3 Vanity Fair 28
Eminence in the City of London', a man 'acquainted with Commerce
in all its Parts' who, as a favourite jest, 'calls the Sea the British
PartTwo 1815-44
Common'. Over the next two centuries Freeport and successive genera
tions of merchants, bankers and others built the City of London into 4 Icons in the Making 3 6
the pivot of the world's entire commercial system, as sterling reigned 5 Parcels of Stock-Jobbers 44
supreme and Britain exported capital to all quarters of the industrial 6 Curst be the Bubbles 6 5
ising globe. A World of its Own tells that story. It is also a collective 7 Il est Mort 73
biography of the people behind it, the clerks at the high sloping desks 8 No Luck about the House IO?
9 Nuova Vita lJI
as well as their superiors who made such enviable fortunes. Ultimately,
this book confronts Steele's proposition that 'a General Trader of good
Part Three 1844-66
Sense, is pleasanter Company than a general Scholar', Sir Andrew
'having a natural unaffected Eloquence, the Perspecuity of his Dis IO City ofDis 138
course gives the same Pleasure that Wit would in another man'. By l l Horrid, Horrid Panic l 5 l
their own words and deeds these practical men are to be judged. 12 From Turds to Dibs 165
13 The Fatal Day 199
14 Change Alley 244
Part Four 1866-90
15 Economical Power, Economical Delicacy 250
16 An Imaginative Faculty 264
17 The Ties that Bind 287
18 Playing the Game 330
19 Gentlemen of Property 368
20 Honest Guinness Stout 396
21 A Friend in Need 42.2.
Notes 439
Acknowledgements 467
Index 469
PART ONE
Prologue
At the corner of Wood Street, when daylight appears,
Hangs a Thrush that sings loud, it has sung for three years:
Poor Susan has passed by the spot, and has heard
In the silence of morning the song of the Bird.
'Tis a note of enchantment; what ails her? She sees
A mountain ascending, a vision of trees;
Bright volumes of vapour through Lothbury glide,
And a river flows on through the vale of Cheapside.
WILLIAM WORDSWORTH, The Reverie of Poor Susan (1800)
Prologue
Coffee-house in Lloyd's, though not among those with whom you deal,
who have very little capital?' His reply was unanswerable: 'I suppose
this may be the fact, but I cannot say; I go into the Coffee-house to do
CHAPTER ONE
my business with those I have business to do with .. .'1
Outsiders
William Hancock also found the streets of London paved with the
right stuff. The son of a Berkshire innkeeper, he entered in 1773 the
service of Smith, Payne & Smiths, a leading bank in Lombard Street,
and speedily rose to be confidential clerk. From 1780 he became a.
compulsive defalcator, robbing his trusting employers of enormous
Picture the prosperous underwriter at home: sums of money, until just before Christmas 1798, expecting at last to
be uncovered at the annual balancing of books, he wrote them an
We dined at 6 oClock. The dinner consisted of two Courses. viz: a Fine almost boastfully wretched letter of confession:
Turbot at the top, A Sirloin of Beef at the bottom & vermicelli Soup in the
middle, with small dishes making a figure of dishes. The remove roast I shudder when I behold the enormity of my guilt but it would be a
ducks at the top & a very fine roast Poulet at the bottom, macaroni, mockery of too detestable a nature to affect remorse while I have con
tartlets &c &c. afterwards Parmesan & other Cheese & Caviare with tinued almost to the present moment to follow up a principle of such
toast. - Champaigne & Madeira were served round during dinner ... I dishonourable conduct ... I anticipate the inevitable necessity of self
observed that Mr. Angerstein drank very little wine after dinner. - While murder which guilt will force me to because altho' I have been base
the Conversation went on He for some time slept, - after He awoke He enough to turn your confidence to the most dishonourable purposes I
eat an orange with Sugar. - He appears to consider His Health but looks cannot endure to meet you when you know me guilty, much less can I
very full and well. stand the infamy of a public stigma ... Before this reaches you, the hand
which dictates these lines will be lifeless and happy would it have been for
The appreciative guest was the diarist Joseph Farington, his host John those connected with me that I had many years since died.
Julius Angerstein, in his late sixties in 1804 but still the best-known
man at Lloyd's. 'When his name appeared on a policy, it was a But Hancock's crimes were not discovered, the letter was not sent, and
sufficient recommendation for the rest to follow where he led without over the next eight years there took place an annual ritual of more
further examination.' From uncertain beginnings, Angerstein's life had defalcations, the remorseful missive composed and the losses not no
charted an exemplary course. He was born in St Petersburg in 17 3 5, ticed. By l 80 5 he was expressing a wish to retire, which prompted a
nominally into a well-known Hanoverian family recently settled there, letter between partners: 'Mr Hancock's abilities, fidelity, long services
though it is at least possible that he was the natural son of the Empress & zeal are so great that in my opinion it will be very injudicious to
Anna of Russia and the merchant Andrew Poulett Thomson. Either suffer him to quit us. He hinted that he knew the Banking business was
way, Angerstein was in Thomson's counting house in the City of not so productive as formerly & that since our attention had been
London by the age of fifteen; he was soon making his way as a marine turned to the expences he had not presumed nor should he ever again
insurance broker and underwriter; and in 1774 he had a handsome give any orders which might incur expence.' At last, in January 1807,
country villa built for him in Blackheath. There, at Woodlands, he was Hancock's nerve cracked. One Tuesday, instead of going to work, he
not only a munificent and particular host but also such an acute travelled to Brighton, from where he sent the senior partner the key to
collector of pictures that after his death in 1823 the collection formed his desk and an accompanying letter: 'When you open the desk,
the nucleus for the National Gallery. Yet always, requiring even less summon all your fortitude and self-command to prevent those who
sentiment of judgement, there was Lloyd's, and in 1810 we hear the may be near to you suspecting the infernal confessions which the
authentic, dispassionate voice of Angerstein giving evidence to a par papers in the packet will place before you. It is beyond all of the worst
liamentary committee. The question was nervous enough: 'Do not you systems of private treachery ever known. When this reaches your hand,
believe, in point of fact, that there are a great many Underwriters in the mine will be lifeless.' So it was, and it transpired from Hancock's
3
2
Prologue
A World of Its Own
every thing else? Is it really true, that such an event put business nearly at
meticulously kept red leather pocket book that since 1780 his defalca
a stand? Is it really true, that it produced an effect equal to peace or war
tions had amounted to £87,800, worth at least £4m in present-day
suddenly made? And is it true; is there truth in the shameful fact, that a
values. No one knew what had become of the money or why he had Jew Merchant's shooting himself produced alarm and dismay in the
done it.2 capital of England, which is also called, and not very improperly, per
Hancock's death caused few ripples in the wider world, but perhaps haps, the emporium of the world?
the Goldsmid brothers, being of broad sympathies, nodded mutely.
Benjamin and Abraham Goldsmid were the youngest sons of a Dutch There may have been truth in these dreadful impeachments, but for
merchant who had settled in London shortly before their birth in the Abraham and his brother, both interred in the Jews burial ground at
1750s; and after going into business together in 1776 they achieved an Mile End, it hardly mattered.3
astonishing ascent, so that by the beginning of the nineteenth century Altogether more robust was the next great Jewish financier. The
they were the dominant figures in the City. Their firm did all sorts of brewer Sir Thomas Buxton encountered him - a short, heavy figure
business - bill broking, money dealing, loan contracting, dealing in the with protruding lips and bulbous eyes - at a dinner party in 18 3 4, and
funds, merchanting, virtually the lot - and to each they brought dex fragments of a life story spilled out:
terity, resource and attention to detail. Their fame grew, so did their
fortune, and inevitably they acquired country houses. Abraham's was There was not room enough for all of us in Frankfurt. I dealt in English
goods. One great trader came there who had the market to himself. He
Morden Hall, while Benjamin built his own resplendent mansion at
was quite the great man, and did us a favour if he sold us goods.
Roehampton, fervently described by a contemporary biographer:
Somehow I offended him, and he refused to show me his patterns. This
'Every thing is here on a scale of magnificence and beauty equal to any
was on Tuesday. I said to my father, 'I will go to England'. I could speak
Nobleman's country seat. Drawing, Music and Dancing Rooms fur nothing but German. On the Thursday I started. The nearer I got to
nished with the highest taste and latest fashions ... Ice houses, hot England, the cheaper goods were. As soon as I got to Manchester, I laid
houses, the whole forming an accommodation fit for the reception of out all my money, things were so cheap, and I made good profit ...
a Prince.' Both men were also prominent philanthropists, Benjamin When I was settled in London, the East India Company had £800,000
worth of gold to sell. I went to the sale, and bought it all. I knew the Duke
being the founder of the Royal Naval Asylum, and both were friendly
of Wellington must have it. I had bought a great many of his bills at a
with the royal family. Yet the end came with remarkable suddenness.
discount. The Government sent for me, and said rhey must have it. When
Benjamin had become fat, gout-ridden and melancholic; and in 1808
they had got it, they did not know how to get it to Portugal. I undertook
he hanged himself, by the silk cord that he normally used for levering all that, and I sent it through France; and that was the best business I
himself out of bed. It was a huge blow to Abraham, the gentler, less ever did.
socially ambitious of the two. He seemed to recover, but in 8 ro a loan
l
for which he had contracted began to go badly wrong, an over-driven The monologue was only briefly interrupted when someone at the
ox knocked him down in Lombard Street, and by the last Thursday in dinner table expressed the hope that his children were not too fond of
September he was in a strangely savage mood on the Royal Exchange, money and business:
talking of revenge against his enemies in the money market. That
evening at Morden Hall he played a distracted hand of cards and early I wish them to give mind, and soul, and heart, and body, and everything
the next morning he shot himself, in the part of his grounds called the to business; that is the way to be happy. It requires a great deal of
boldness, and a great deal of caution, to make a great fortune; and when
Wilderness, given over to a rookery. News of his death caused intense
you have got it, it requires ten times as much wit to keep it. If I were to
consternation in the City, to the outrage of William Cobbett, who
iisten to all the projects proposed to me, I should ruin myself very soon.
issued a characteristic blast in his Weekly Political Register:
The speaker was Nathan Mayer Rothschild, a nonpareil figure in
All this for the death of a Jew merchant! The king and the heir apparent
the City's entire history, and for once the recollections late in life of
to be informed of it by a royal Messenger! And, is it really true, that this
a successful self-made man bear some relation to historical fact.
man's having shot himself made the citizens of London forget almost
5
4
A World of Its Own Prologue
Rothschild was born in 1777 the third son of a Frankfurt merchant, was The situation of this house is truly disastrous ... You can have no idea
of the Extravagance of both nay all the partners. They are :nen of the
based in Manchester from 1799 and prospered as a textile merchant,
most generous, easy disposition imaginable - but all their friends are
and in l 8 o 8 opened a permanent office in the City, at first in Great disgusted with their ridiculous stile which has resembled that of Princes
St Helen's Street but moving to New Court in St Swithin's Lane shortly
more than Merchants. These things must have an end - a variety of
after. During the latter stages of the Napoleonic Wars he made his unfortunate, ill contrived, ill advised, Speculations carried off in the last
fortune through the audacious conduct of crucial bullion operations two years £50,000, a great property say £140,000 lies in Jamaica unsa
on behalf of the British Government, in the course of which he was leable. Mr Murphy's Brother a great scoundrel in Spanish America owes
much helped by large credits from his four brothers who were based in us £300,000 which he disputes & will not pay a halfpenny of. These
things added to the Expenditure of the partners which may amount yearly
various financial centres on the Continent. That was the prime source
to £25,000 have brought the house to its present state of humiliation
of his initial great wealth; it was not (contrary to legend) a major
wherein it cannot obtain credit for a £ 100 - after being thought the
killing on the stock market from being on the inside track over the
richest house in London. All are afraid of us - all have envied us - so all
battle of Waterloo. The Rothschild of these decisive years was quite as now laugh at us hate us & wait with impatience to see our ultimate fall
masterful and single-minded as the relatively benign latter-day version, .. . Yet so sanguine are the partners about their affairs that tho' we are
though not without a neurotic and self-aggrandising streak. Usually on struggling from day to day - they conceive themselves perfectly safe &
the receiving end were his brothers, one of whom, Salomon, showed think because they have large property in various hands that it must all
be recovered & their distresses relieved & such is their infatuation that
some letters to an Amsterdam associate who in turn wrote to Nathan
whilst at this moment one lives in a Gothic Castle on the Banks of the
in June l 814: 'I have to confess sincerely, dear Mr Rothschild, that I
Thames & at Grosvenor Square the other is contesting the Worcester
was embarrassed for your own brother, when I found these big insults
Election tho' absent in Spain.
in your letters. Really, you call your brothers nothing but asses and
stupid boys.' He went on: 'Now God gave you the good fortune to
The castle-dweller was Colonel Murphy, the parliamentary candidate
carry out large-scale transactions, such as, I think, no Jew has ever
Sir William Duff Gordon, the house Gordon, Murphy & Co. And the
done. So you should be happy about it together with your brothers.'
much-harassed clerk was John James Ruskin, who as a young man in
Six months later and Nathan, unabashed, was writing to brother Carl
Edinburgh had hoped to study law but had been overruled by his
in Frankfurt:
grocer father and compelled in I 80 I to begin a commercial career in
London. 'I cannot but say I have turned from my profession for
I have taken the firm resolution to put the Frankfurt House on a new
moments repeatedly with disgust', he wrote in his apocalyptic letter
basis ... I would rather give up business in Frankfurt than to have you
home, adding that 'had I my life to lead over again, nothing should
cry for money all the time ... Speaking quite frankly your letters some
make me a Merchant'. For years he had been working fearsomely long
times drive me crazy. They are written in such a crude way. You use some
horrible expressions ... I am risking wife and children and am content hours, which were compounded by Sir William's habit of coming from
with a fifth, quite apart from the fact that I drive myself crazy ... the House of Commons to the City in the evening; and in August r 8 r 3,
with the firm still staggering on, he took his first holiday in almost a
He need not have worried, for 1815 was to be the year in which he decade. He later recalled it: 'I left by Coach for Edinburgh after being
netted about a million in connection with the payment of the British in Counting House till Midnight - totally exhausted & was seized with
army and its allies. 'I do not read books, I do not play cards, I do not Typhus fever at Ferry bridge'. On Ruskin's eventual return to the City he
go to the theatre, my only pleasure is my business', Nathan informed left the firm and set up with two others a successful sherry-importing
his brothers at the start of 1816, before adding astutely of the place he business.5 In 1819 his wife gave birth to the Victorian prophet whose
had made home: 'As long as we have a good business and are rich most abiding dictum would be that 'there is no weaith but life'.
everybody will flatter us'. 4 Angerstein, Hancock, the Goldsmids, Rothschild, Ruskin senior -
City houses rose, City houses fell, and in October l 8 l 2 an anxious all outsiders who experienced intensely contrasting fortunes. Over
clerk wrote to his mother in Scotland: the next two centuries the City would flourish inasmuch as it was
6 7
A World of Its Own
susceptible to outside influences and the rise of new men, congeal
inasmuch as it allowed itself to be dominated by dynastic conservatism.
Clubs, like families, are capable of renewing themselves; but they still CHAPTER TWO
remain clubs. Such was to be the City's inner history until the late
The Whole Earth Emporium
twentieth century.
Once upon a time the City was London, and by Tudor times at the
latest it had established itself as a leading international trading centre.
Thomas Gresham's successful establishment of the Royal Exchange in
r 570 consolidated the fact. By the end of the seventeenth century
London towered over the rest of the country in almost all types of trade
(its population of half a million was meekly followed by Norwich with
30,000). In the eighteenth century came the great surge in British
commerce, which took three main forms: a growing domestic demand
for American and Asian consumer goods (above all sugar, tea, tobacco
and coffee) and North European raw materials (such as forest products
like timber); a growing European market for re-exports of American
and Asian consumables; and a growing protected market for British
manufacturers in the American colonies and Africa.1 The City of
London was to the fore in servicing all three markets. This prosperity
could not have been achieved without a growing naval dominance that
brought Britain spectacular colonial gains in Canada, the West Indies
and India, more than offsetting the subsequent loss of America, which
anyway still left intact much of Britain's growing transatlantic com
merce. It was this imperial thrust that gave a particular trading primacy
in the City to so-called 'colonial goods', which included not only food
and drink, but also cotton, dyestuffs and printed textiles. 2 'London is
become, especially of late, the trading metropolis of Europe, and,
indeed, of the whole world', asserted the banker-cum-economist Henry
Thornton in 1802. And soon afterwards The Picture of London said
much the same thing in best guide-book purple: 'London is the centre
of the trade of the whole world, and more ships sail from it in a year
than from all other places in the world united. It has fifty times more
trade than ancient Carthage, than Venice in its glory; than all the Hans
Towns, or Amsterdam could ever boast. '3
The historic heart of this mercantile community remained the
Royal Exchange, rebuilt after the Great Fire of r 666 and the single
great meeting-place for the City's merchants and the several hundred
8 9
A World of Its Own Prologue
specialist brokers who acted as intermediaries between them. Defoe in immigration. Huguenots, Dutch Jews and Germans handled much of
the 172os called it 'the greatest and finest of the kind in the world', the trade to and from northern Europe, while Portuguese Jews traded
while a few years later a revised edition of Stow's Survey of London to and from the Iberian Peninsular, the Mediterranean and even be
explained how 'for the more easy expediting of their work the mer yond.6 Of the 810 merchants who kissed the hand of George III on his
chants dealing in the same Commodities have by custom fixed on these accession in 1760, at least 2 50 were (on the basis of their surnames) of
different Parts of the Exchange to meet one another, called Walks' - palpably alien origin. It was typical that during this third quarter of the
walks that included the Norway Walk, Virginia Walk, Jamaica Walk, century the first members of the Cazenove family to make an impact in
Spanish Walk and Jews Walk. These walks, with their specialist impli the City, the merchanting cousins John Henry and James, were grand
cations, prefigured the ultimate decline of the Royal Exchange as a children of a French Huguenot who had left France for Geneva in the
commercial assembly, but it was not a rapid process. During the wake of the Revocation of the Edict of Nantes. Or take Levi Barent
eighteenth century, despite the emergence of the odd specialist ex Cohen: he was a Dutch merchant who settled in England in about 1770
change such as the Corn Exchange in Mark Lane in 1749 and the Coal and in due course became a great City patriarch, with Nathan Roths
Exchange in Thames Street in 1770, the celebrated heyday of the coffee child as a son-in-law.7
house served to complement rather than rival the Royal Exchange in However, Addison gazed upon 'countrymen' as well as 'foreigners',
the daily rhythm of City life. Most of the main coffee houses were and the City remained a strong pull to more homegrown mercantile
centres for trade with particular areas of the world, though Garra way's talent. Matthew Wood was born about 1768 the son of a Devon serge
of Change Alley, for instance, was renowned for the length of its hours manufacturer, worked for eight years for druggist firms in Exeter, and
and the variety of its sales of commodities. Thus the Jamaica was at the ripe age of twenty-two was head-hunted by Crawley & Adcock
largely frequented by those involved in the West Indies trade, the of Bishopsgate Street. Further moves followed, until in 1797 he went
Jerusalem by those concerned with the East, the Virginia and Baltic into prosperous partnership as a hop merchant just off Cripplegate.
(forerunner of the Baltic Exchange) by those whose merchandise came Also from Exeter (though his wool-merchant father had come from
from either the American colonies or Baltic seaboard, and so on. What Bremen) was young Francis Baring, who after a suitably arithmetical
did these coffee houses provide? Partly working premises when offices education at Mr Fuller's Academy in Lothbury opened a merchant
were still rare, a place where merchants and others could do a certain house at Queen Street, Cheapside in 1763. Forty years on and Faring
amount of business as well as their paperwork either side of a session ton was noting in his diary: 'Sir Francis Baring's House is now unques
on 'Change; partly sustenance; but above all the very latest informa tionably the first Mercantile House in the City. He is a General
tion, as 'the coffeemen vied with each other in maintaining the supply Merchant. The Partners are respected. Other Houses, comparatively,
of a wide variety of domestic and foreign newspapers, news-sheets, only come in for gleanings.' It was a remarkable achievement and on
journals, and bulletins, customs-entry forms, auction notices, price his death in I 8 IO he was described by Lord Erskine as 'unquestionably
current lists, &c, in addition to making known their particular brand the first merchant in Europe', being 'first in knowledge and talents, and
of punch and other beverages'. 4 first in character and opulence'. 8
And the merchants themselves? 'There is no place in the town which A strong international connection was virtually a prerequisite of
I so much love to frequent as the Royal Exchange', wrote Addison in successful merchanting, typified in the case of Barings in the late
The Spectator. 'It gives me secret satisfaction as an Englishman to see eighteenth century by its close links with the powerful Amsterdam
so rich an assembly of countrymen and foreigners making this metro house of Hope and Co and its increasing ability to provide credit to
polis a kind of emporium for the whole earth. Sometimes I am jostled leading merchants in North America. 'London is the principal centre
by a body of Armenians, sometimes I am lost in a crowd of Jews or of the American Commerce, London houses acting almost solely as
Dutchmen, sometimes Danes, Swedes or Frenchmen .. .'5 It was of bankers for the America trade, receiving the proceeds of consignments',
course no new thing for foreign merchants to settle in London in order wrote Alexander Baring in I 808. Also operating in that field, between
to sell the goods of their home region and to buy return cargoes, but 1782 and I802, was the firm of Bird, Savage & Bird. It exported
from the late seventeenth century there were successive waves of manufactured goods to South Carolina and in effect provided the
IO II
A World of Its Own Prologue
finance for such semi-tropical products as rice and indigo to be shipped of risk on behalf of merchants; and that the small family firm was the
to London. Credit was the crux, especially since many merchants, at norm, such as the insurance broking firm started by John Robinson in
home and abroad, began business with little or no capital. Systems of Birchin Lane in about l 800 that was the precursor of Hogg Robinson.
credit could be complicated things, but the basic mechanism on which Did it work? Angerstein certainly thought so, telling the 1810 inquiry
they increasingly revolved was the sterling bill of exchange, a nego into marine insurance that at Lloyd's 'every Insurance almost can be
tiable instrument through which a seller was able to receive payment done with fair connections, and at a considerable advance of Premium'.
for goods as soon as he had sent them on their way. Towards the end Not everyone came out of the experience with a prized picture collec
of the century a few of the leading London merchants, above all tion and roseate memories - 'the labour, the agitation of mind, the
Barings, were taking on a 'finance' function and becoming what would perpetual vexation, is not to be described', stated the experienced
eventually be termed merchant banks - or, more narrowly, accepting broker Thomas Reed, adding that 'I would rather begin the world again
houses - to service the international trading community. It was a and pursue any other line' - but that was another matter. Some of the
profitable business, done on a commission basis; but since it involved merchant witnesses complained that underwriters were too prone to
guaranteeing bills of exchange that would eventually be sold in the take to the spas during the autumn and thus avoid winter risks, but the
London bill market centred on the Royal Exchange, it was one that underwriter James Forsyth, an autumn regular, laconically remarked
demanded the nicest possible judgement of clients, of trades, and of that 'it has not been in my own experience such a bad business at that
countries. time of the year, because I exact a high Premium'. Overall the select
So the substantial eighteenth-century City merchant was rarely a committee gave Lloyd's a clean enough bill of health, and the following
merchant pure and simple - he might easily do any number of other year saw significant internal reorganisation, building on the introduc
things, including dealing in bullion or negotiating foreign drafts and tion of a modicum of quality control in l 800 after which subscribers
remittances. William Braund (1695-1774) was not untypical: his main to the coffee house had to be elected.10
business was the wholesale export of woollens to Portugal, but he took Another central pillar of the City now taking shape was the Bank of
advantage of the Seven Years' War to win a small fortune in the England, established in l 694 by opportunistic merchants in order to
Portuguese bullion trade; and quite apart from being a Manager of the fund the war against France. Over the next century there were few
Sun Fire Office and a Director of the East India Company, respectively pauses for peace, the national debt grew inexorably, and the Bank of
representing merchanting and shipping interests, he became increasing England not only managed that debt but became a government bank,
ly prominent in marine insurance.9 Merchants like Braund defined the looking after the accounts of most of the departments of state. More
eighteenth-century City and would help to give it for long after a over, backed by its considerable bullion reserves, it issued a large
character that was as much 'commercial' as specifically 'financial'. volume of notes, becoming the dominant influence in the London
No merchant could be without insurance. Back in 1691 Edward money market. In the course of the eighteenth century it came to seem
Lloyd had moved his coffee house from near the river to Lombard indispensable: in l 7 4 5, as the looming presence of the Young Pretender
Street in order to be as close as possible to the General Post Office, threatened a potentially fatal run on the Bank, a powerful group of
prime source of shipping intelligence, and over the next half-century merchants met at Garra way's and agreed to accept its notes as payment;
Lloyd's Coffee House specialised increasingly in marine insurance, in the financial crisis of l 76 3 the Bank for the first time acted as lender
with Lloyd's List beginning publication in 1734· In 1769 a new, more of last resort; and in 178 l the prime minister Lord North famously
morally upright Lloyd's Coffee House split from and superseded the referred to it as 'from long habit and usage of many years ... a part of
old one, moving in 1774 into new premises on the first floor of the the constitution'. Yet what is now forgotten is that in the eighteenth
Royal Exchange, with Angerstein negotiating the agreement. Three century the Bank of England was essentially a profit-making bank run
aspects of the Lloyd's of the late eighteenth century stand out: that by merchants on behalf of the mercantile rather than banking com
many of the underwriters were little more than speculators of slender munity, that 'rival' bankers were not allowed to be Bank directors, and
means; that it was the brokers who during the eighteenth century that it saw itself fulfilling a private at least as much as a public function.
largely held the market together and had to make correct assessments There was certainly no continuous sense in which it was a central bank
12