Such a graphic expression of anti-Jewish sentiment was by no means unique: the image of Jews worshipping a pig can be found in numerous woodcut and printed versions dating as far back as the fourteenth century, while the myth of ritual murder gained currency in Germany in the fifteenth. What made the Frankfurt pictures remarkable—at least in the eyes of the city’s most celebrated son, Johann Wolfgang Goethe—was that they were “not the product of private hostility, but erected as a public monument.” The Judensau and the murdered child were officially sanctioned symbols of a long-standing tradition of hostility to an enemy within the free imperial town.¹

The first records of a Jewish community in Frankfurt date back to the middle of the twelfth century, when it numbered between one and two hundred. Its history was one of periodic persecution by the Gentile populace. In 1241, more than three quarters of the Frankfurt Jews were massacred in the so-called “Battle of the Jews” (Judenschlacht). The community re-established itself over the subsequent decades, but just over a century later, in 1349, there was a second pogrom. In both cases, popular millenarianism played a part: in the first “battle,” fears that the Jews were in league with the Mongol horde; in the second, fears instigated by members of a fla gellant order that the Jews would attract the plague to the town.

There were, however, worldly reasons why both the Holy Roman Emperor—who declared the Jews “servi nostri et servi camerae nostri” in 1236—and the municipal authorities were inclined to encourage Jewish settlement. The Jews were a source of tax revenue and credit (given their exemption from the laws prohibiting usury) who could be offered “protection” and restricted privileges in return for hard cash. But protection and restriction went hand in hand. In 1458, at the order of the Emperor Frederick III, the Jews were confined to a ghetto (from the Italian borghetto or suburb): a single, narrow street on the north-eastern edge of the town at both ends of which gates were erected. To the 110 Jews living in the town, this capitivity in what became known as the Judengasse (Jews’ Lane) suggested a “New Egypt.” On the other hand, the persistent risk of popular violence could give the ghetto the character of a sanctuary. Allegations of ritual murder in 1504 and an attempt to declare the Jews heretics five years later provided a reminder of the vulnerability of the community’s position, as did the conversion of the majority of the town’s population to Lutheranism in 1537, given the avowed hostility of Luther towards the Jews. The Judengasse provided sanctuary of sorts in a perilous world; and between 1542 and 1610 its population grew from around 400 to 1,380 (an increase which was paralleled by Huguenot migration to Frankfurt from the Netherlands). The economic and social tensions which coincided with—or were caused by—these influxes culminated in yet another outbreak of popular violence against the Jewish community: the “Fettmilch riots,” named after their shopkeeper leader Vincenz Fettmilch. However, wholesale looting of the Judengasse was this time not accompanied by mass murder (the Jews were expelled from the town) and, after a brief period of popular rule, imperial troops quashed the insurrection. Fettmilch and the other leaders of the revolt were hanged and the Jews marched back into the ghetto, their status as protégés of the Emperor reaffirmed.

In practice, as before, “protection” meant extraordinarily tight regulation, the details of which were set out by the Council in the Stättigkeit, a statute which was read out each year in the main synagogue. Under its terms, which remained in force until the very end of the eighteenth century, the Jewish population was restricted to just 500 families; the number of weddings was rationed to just twelve a year and the age of marriage fixed at twenty-five. No more than two Jews from outside were allowed to settle in the ghetto each year. Jews were prohibited from farming, or from dealing in weapons, spices, wine and grain. They were forbidden to live outside the Judengasse and, until 1726, were obliged to wear distinctive insignia (two concentric yellow rings for men and a striped veil for women) at all times. They were confined to the ghetto every night, on Sundays and during Christian festivals; at other times, they were forbidden to walk in the town more than two abreast. They were barred from entering parks, inns, coffee houses and the promenades around the town’s picturesque walls; they were not even allowed near the town’s ancient cathedral; and had to enter the town hall by a back door. They were permitted to visit the town market, but only during set hours, and were forbidden to touch vegetables and fruit there. If he appeared in court, a Jew had to swear a special oath which reminded all present of “the penalties and maledictions which God imposed on the cursed Jews.” If he heard the words “Jud, mach mores!” (“Jew, do your duty!”) in the street, he was obliged—even if they were uttered by a mere boy—to doff his hat and step to one side. And if he had occasion to go outside Frankfurt—for which a special pass was required—he paid double the amount of toll paid by a Gentile when entering the town. In return for this supposed “protection,” every Jew also paid a poll (or “body”) tax.

All this meant that the Frankfurt Jews spent most of their lives within the high walls and gates of the Judengasse. Today virtually nothing remains of this prison-cum-street. All but a couple of houses were demolished by the Frankfurt authorities in the course of the nineteenth century, and what little remained was flattened by American bombers in May 1944. However, the foundations of a part of the old street have recently been excavated, and these give at least a rough idea of the inordinately cramped conditions of life in the ghetto. Curving from the Börnheimer Gate in the north towards the Jewish cemetery in the south, it was just a quarter of a mile long and no more than twelve feet wide—in places less than ten. Having originally been designated a ghetto at a time when the Jewish population was little more than a hundred, the lane was horribly overcrowded: by 1711 there were no fewer than 3,024 people living there. Accommodating them all in such a small area required a high degree of architectural ingenuity: houses were just eight feet wide and had up to four storeys, and behind each row an additional row was constructed. Fire was an inevitable hazard—indeed, all or part of the Judengasse was destroyed by major conflagrations in 1711, 1721 and 1774. This meant that life there was both dear and cheap: dear because the demand for housing far outstripped the supply, so that a four-room house in the north of the Judengasse cost as much as Goethe’s father paid for his twenty-room mansion in the Grosse Hirschgraben; cheap because lack of sanitation, light and fresh air reduced life expectancy. In the 1780s it was estimated that average mortality among Jews was 58 per cent higher than among Gentiles. A traveller in 1795 observed how “most of the people among the Frankfurt Jews, even those who are in the blooming years of their life, look like the walking dead . . . Their deathly pale appearance sets them apart from all the other inhabitants in the most depressing way.” Later, after the walls around it had been partly demolished, the Judengasse was to some extent romanticised by artists like Anton Burger; indeed, it became something of a Victorian tourist attraction (Charles Greville and George Eliot were among the English visitors). At the time, it struck the young Goethe as a hellish slum:

One who knew it more intimately was the poet Ludwig Börne, who (as Juda Löw Baruch) grew up there in the 1780s and 1790s. Looking back in anger rather than nostalgia, he remembered a

As Börne commented, even at a time of supposed “enlightenment,” when other German cities were relaxing the restrictions imposed on Jews, Frankfurt held out, refusing to implement the Emperor Joseph II’s Edict of Toleration (1782) and confiscating copies of Ephraim Lessing’s philo-Semitic play Nathan the Wise. When the Jewish community petitioned in 1769 and again in 1784 to be allowed to leave the ghetto on Sundays, the request was rejected as an attempt “to put themselves on an equal footing with the Christian residents.”² As in the past, this policy was to some extent forced upon the Council by the majority of the Gentile townspeople. Typically, when a Jewish mathematics teacher was granted permission to live and teach outside the ghetto in 1788, there was such a popular outcry that the licence had to be revoked; and a similar request by a Jewish doctor in 1795 was turned down flat. For much the same reason—as a letter of complaint signed by seven leading Jewish merchants makes clear—the rules governing travel outside the Judengasse on holidays and Sundays were made more rather than less restrictive in 1787, with the introduction of a complicated system of identity cards:

There was more to this persistent and systematic discrimination than mere ancestral prejudice, however. An important factor was that the Gentile business community genuinely feared the economic challenge which they believed would be posed by an emancipated Jewish population. The fact that a slum like the Judengasse could produce mathematics teachers and doctors in itself tells us something important about its culture: it was not as closed as it seemed. As Goethe himself discovered, when he plucked up the courage to enter the ghetto, the Jews were “human beings after all, industrious and obliging, and one could not help but admire even the obstinacy with which they adhered to their traditional ways.” Despite—perhaps partly because of—the grim conditions in which they lived, the Frankfurt Jews were anything but an underclass in cultural terms.

Of course, the culture of the Judengasse was an unfamiliar one to a Gentile like Goethe. It was an intensely religious culture, with the rhythm of life still dictated by the religious laws of the Halakha. Every morning and evening, men were summoned to worship at synagogue by the Schul-Klopper knocking on their doors with a hammer. The Sabbath was, as an English visitor recalled, “in the picturesque phrase of their prayer-book, ‘a bride,’ and her welcome, week by week, was of a right bridal sort. White cloths were spread and lamps lit in her honour. The shabbiest dwellings put on something of a festive air.” Education at the lane’s three primary schools (heder) and the rabbinical college (yeshivah) was, by the standards of the time, conservative, with children learning to read the Torah, the foundation of Mosaic teaching law, then moving on to Rashi’s commentaries and finally the Talmud, the compilation of rabbinical commentaries and debates on rules of observance. The community had its own fire brigade and hospitals, its own cemetery and its own voluntary associations to provide for the poor.

Yet, despite the high walls which surrounded it, and despite the relatively limited impact of the Jewish Enlightenment on the community (as compared with that of Berlin), the culture of the Judengasse was far from insular. Although Gentiles sometimes sneered at their manner of speech, Heinrich Heine later insisted that the Frankfurt Jews spoke “nothing but the proper language of Frankfurt [which is] spoken with equal excellence by the circumcised as well as by the non-circumcised population.” This was a slight, though pardonable, exaggeration. Those Jews who did manage to secure for themselves a secular as well as a religious education—like the doctor mentioned above—would have spoken, read and written Hochdeutsch. The surviving letters of Mayer³ Amschel Rothschild, however, confirm that his was a rough and often ungrammatical German, with an admixture of Hebrew; and when he wrote to his sons he used Hebrew characters, as did they when they wrote to one another. Nevertheless, the Judendeutsch of the Judengasse was not the Yiddish of the Polish and Russian stetl; and in all probability many Gentile merchants in Frankfurt wrote ungrammatical letters too. When Frankfurt Jews left the Judengasse to do business—the avenue of activity most accessible to them—there was no insuperable language barrier between them and the Gentile merchants they encountered.

More than most German towns in the eighteenth century, Frankfurt was a businessman’s town. At the junction of several major trade routes linking the towns of South Germany (Strasbourg, Ulm, Augsburg and Nuremberg) to the Hanseatic ports of the North (Hamburg, Bremen and Lübeck), and linking Germany as a whole to the economies of the Atlantic seaboard, the Baltic and the Near East, its prosperity was bound up with the two annual fairs in the autumn and the spring which had been held in the town since the Middle Ages. And because of the enormous variety of coinage circulating in Europe up until the late nineteenth century, the town’s commerce necessarily went hand in hand with banking: in particular, money-changing and bill-broking (buying and selling the IOUs generated by more complex transactions). In addition—and in some ways more importantly—Frankfurt acted as a financial centre for the princes, archdukes and electors who governed the numerous petty territories of the region. The revenues from their lands and subjects (rents, taxes and so on) and the expenditures of their courts (on grand residences, gardens and entertainments) made these rulers the biggest customers of the pre-industrial German economy, even if most of them were considerably less well off than their counterparts in the English aristocracy. In particular, the fact that the majority generally spent more than they earned created lucrative if sometimes risky opportunities for German bankers.

Perhaps the most successful firm in this field prior to 1800 was that of Simon Moritz and Johann Philipp Bethmann, who imported from Amsterdam to Germany the system of “sub-bonds” (Partialobligationen) whereby a large loan could be subdivided into more manageable portions and sold on to a wide clientele of investors. A typical transaction was the Bethmann Brothers’ loan to the Holy Roman Emperor of 20,000 gulden (around £2,000) in 1778, which they sold on to investors in the form of twenty 1,000-gulden bonds, handing over the cash thus raised—minus their substantial commission—to the imperial Treasury in Vienna, and subsequently ensuring the prompt payment of interest from Vienna to the bondholders. Between 1754 and 1778 the Bethmanns floated loans totalling nearly 2 million gulden, and no fewer than fifty-four separate loans totalling nearly 30 million gulden in the following five years. Other Frankfurt bankers became involved in the same kind of business, notably Jakob Friedrich Gontard.

Neither Bethmann nor Gontard was Jewish. Yet there is no question that, by the later eighteenth century, it was Jews who had come to be seen as the most enterprising operators when it came to money-changing and all kinds of lending. After more than a century of scholarly reflection on the subject, it is still hard to say quite why this was. Any advantage Jews enjoyed over Gentile financiers can have been only an indirect result of their system of education: Mayer Amschel Rothschild once recalled that “in my youth I was . . . a very active merchant, but I was disorganised, because I had been a student [of the Talmud] and learnt nothing [about business].” Probably membership of a tightly knit “outsider” group helped when it came to constructing credit networks. And perhaps there was a kind of business ethic derived from Judaism. But these points can be made with equal force about other religious minorities, as they were by Max Weber, who unconvincingly contrasted “the Protestant ethic” with the Jewish ethos of “politically and speculatively oriented . . . pariah capitalism.” The least unsatisfactory answer is that, at a time when most fields of economic activity were closed to them, Jews had little alternative but to concentrate on commerce and finance. At the same time, their Gentile rivals in these fields probably tended to exaggerate the extent of the “Jewish threat” to their business. The non-Jewish bankers of Frankfurt were complaining as early as 1685 that “the Jews had torn the bills trade from their hands”—a claim which led to a ban on Jews entering the stock exchange. Twelve years later the Council was trying, not for the last time, to prevent Jews from renting warehouses in the Fahrgasse, the town’s main street.

Perhaps the most notorious conflict of this sort centred around the role of Joseph Süss-Oppenheimer, who rose from being Hoffaktor (court agent) to Duke Karl Alexander of Württemberg to the much more political posts of privy councillor and, in 1733, envoy in Frankfurt, where his privileged position allowed him to live outside the Judengasse in the comfort of the Golden Swan Inn. Four years later Oppenheimer was executed, having been found guilty of wielding excessive political power and undermining the position of the Württemberg estates (Stände). Oppenheimer—the Jud Süss of later anti-Semitic legend—was only the most notorious of the Jewish court agents, however. By the mid-eighteenth century Frankfurt Jews were acting as agents for the Palatinate, the Electorate of Mainz, the Grand Duchy of Hesse-Darmstadt, the Kingdom of Prussia, the imperial court in Vienna, as well as Hesse-Kassel and Saxe-Weimar. Löw Beer Isaak, for example, was court agent to the Prince of Nassau-Saarbrücken in 1755, while David Meyer Kupl challenged the dominance of the Kann family when he became imperial court agent at around the same time. Such men formed a rich and privileged elite within the Judengasse.

The most we can say about the early Rothschilds is that they were pious and relatively successful small businessmen dealing in, among other things, cloth. Five years before his death in 1585, Isak zum roten Schild had a taxable income of 2,700 gulden, and when he died he was remembered on his gravestone for his “virtue,” “righteousness” and “honesty.” A century later his great-grandson Kalman, a money-changer who also dealt in wool and silk, had a taxable income more than twice as large; and it seems that his son—Mayer Amschel’s grandfather Moses—successfully developed his father’s business, continuing the process of steady social ascent by marrying, successively, the daughters of a tax collector and of a doctor. Unfortunately, we know next to nothing about the economic achievements of Mayer Amschel’s father, Amschel Moses—though the fact that the family continued to live in the modest house at the Hinterpfann, with its ground-floor office, its first-floor kitchen and cramped bedrooms above, suggests at best consolidation, at worst stagnation. To judge by the lengthy and fulsome praise on his gravestone inscription, the family had done no more than attain solid respectability within the ghetto by the time he died.

Amschel Moses was evidently a studious man—he was, according to his gravestone, “a man who observed the prescribed time for the study of the Torah.” This may possibly explain why he sent his son Mayer Amschel away to the rabbinical school at Fürth when he had completed his primary education in Frankfurt. Whatever his reasons, it is not the case (as some historians have erroneously inferred) that Mayer Amschel was intended for the rabbinate; Cohen, who wrote a brief and laudatory biography shortly after Mayer Amschel’s death and probably knew him, states that he only “studied his religion in order . . . to be a good Jew.” However, Mayer Amschel’s studies at Fürth were cut short by the untimely death of his parents in 1755 and 1756, victims of one of the epidemics which still periodically swept through German towns. He was just twelve years old.

At this point, he might well have returned to rejoin his elder sister, Gutelche, and two brothers, Moses and Kalman. Instead, he was sent to Hanover to learn the rudiments of business in the firm of Wolf Jakob Oppenheim (presumably a business associate of his father’s). This was a formative experience, because it brought him for the first time into direct contact with the privileged world of the court agents. Of course, Mayer Amschel almost certainly knew something of this world already. Süss-Oppenheimer, after all, had been executed just six years before he was born. Moreover, we know that Süss had been involved in at least one bills transaction with Mayer Amschel’s grandfather. But now the boy could see at closer quarters what it meant to be a “court Jew,” since Oppenheim’s grandfather Samuel had been court agent to the Austrian Emperor, and his uncle was agent to the Bishop of Cologne. It was in Hanover that Mayer Amschel began to acquire an expertise which was calculated to help him acquire the status of court agent for himself. He became a dealer in rare coins and medals, a line of business in which clients were almost invariably aristocratic collectors, and in which a knowledge of Samuel Maddai’s complex system of numismatic classification was indispensable.

When he returned to Frankfurt—as he was obliged by residence laws to do when his apprenticeship ended—in around 1764, Mayer Amschel was quick to put this expertise to good use. Within a year of his return, he had succeeded in selling rare medals to a well-born client whose future importance to the Rothschilds was to be considerable. Admittedly, Mayer Amschel’s first transaction with William, Hereditary Prince of Hesse-Kassel, was small beer. Assuming that he was the “Jew Meyer” referred to in William’s Privy Purse accounts for June 1765, it involved nothing more than 38 gulden and 30 kreuzers—a trifling sum, and one of many such small purchases the Prince made from various dealers in the years after 1763, as he built up his fashionable collection of medals and coins.⁴ Nevertheless, this—along with “various deliveries” of which no record survives—was enough to justify a request in 1769 that Mayer Amschel be granted the title of court agent, a request which was duly granted in September of that year. A year later he consolidated this new status. In August 1770 (at the age of twenty-six) he married Gutle, the sixteen-year-old daughter of Wolf Salomon Schnapper, court agent to the Prince of Saxe-Meiningen. In addition to the benefits of association with her father, the match brought Mayer Amschel vital new capital, in the form of a dowry of 2,400 gulden. It was to prove the first of a succession of carefully calculated Rothschild marriages, laying a foundation of prosperous kinship every bit as important as the foundation of royal patronage represented by the title of court agent.

In the years which followed, Mayer Amschel—initially in partnership with his brother Kalman, before the latter’s death in 1782—successfully established himself as Frankfurt’s leading dealer not only in coins and medals, but also in all kinds of antiques. We can see how he operated from the meticulous catalogues he circulated to his widening circle of aristocratic customers. By the 1780s the items listed included ancient Greek and Roman as well as German coins, and also a variety of other antiques and “curiosities” of the sort a wealthy collector might display alongside his coin collection: carved figures, precious stones and the like. The total value of the goods for sale in each catalogue varied from around 2,500 gulden to 5,000 gulden; however, if an item interested a client, Mayer Amschel would send it for inspection and then, if the customer wished to make a purchase, negotiate a selling price, often some way below the guide price in the catalogue. According to the surviving Privy Purse accounts, Prince William did not become a regular customer until 1790, after which date he made purchases almost every year. Other clients included Goethe’s patron, the Duke of Weimar.

That the basis of the Rothschilds’ fortune was mail-order antique sales to aristocratic numismatists may seem surprising; but there is no question that without the capital Mayer Amschel was able to accumulate by buying and selling “curiosities,” he would never have had the resources to move into banking. It is not immediately obvious how successful he was as an antique dealer: his property tax assessment remained a constant 2,000 gulden between 1773 and 1794. However, the Maaserbuch or Zehentbuch in which he punctiliously recorded his charitable donations (a tenth of his annual income, according to Jewish law) suggested to his later biographer Berghoeffer that Mayer Amschel’s annual income in the 1770s must have been in the region of 2,400 gulden—roughly the same as that of the Goethe family, and rather more than was earned at the time by a local official like a tax assessor (Schultheiss). On the basis of these and other available figures, Berghoeffer estimated Mayer Amschel’s total wealth in the mid-1780s at around 150,000 gulden (around £15,000).

We also know that Mayer Amschel was rich enough to move house in 1787. Shortly after returning to Frankfurt, he and and his two brothers had acquired complete ownership of the Hinterpfann house, buying out the distant relations with whom their parents had shared it. Now, some twenty years later, Mayer Amschel sold his three-eighths share of the Hinterpfann to his brother Moses (for 3,300 gulden) and, beginning in 1783, bought a substantially larger house, “zum grünen Schild” (“the green shield”), for more than 11,000 gulden.⁵ By the standards of a Gentile family like the Goethes, this was still a wretchedly cramped place to live: just fourteen feet wide, with rooms so narrow that beds could be placed only along the side-walls at right angles to the street. It was wretched by the standards of the next generation of Rothschilds too: Mayer Amschel’s sons would look back without nostalgia on the days “when we all slept in one little attic room.” But by the standards of the Judengasse it was a desirable residence. Located in the middle of the street—roughly opposite the middle, western gate—it had been rebuilt after the 1711 fire and, unusually, had its own waterpump. On each of the three upper storeys of the main building there was a narrow room looking over the street—each with three small windows, a stove and wall cupboard—and a similar room looking inwards over the yard. Through the back door, there was a little courtyard with a small two-storey building, part of which housed the single lavatory. Unusually (and usefully) the house had two cellars, one of which was reached through an obvious enough trapdoor in the entrance hall, and the other—a larger cellar which the house shared with its next-door neighbour—which was accessible only through a concealed opening underneath the stairs, and was unconnected to the other cellar.⁶ The new space above the ground, limited though it may have been, was needed; for Mayer Amschel and his wife were proving to be a remarkably procreative couple, even by late-eighteenth-century standards. It appears that Gutle Rothschild gave birth virtually every year between 1771, the year after her marriage, and 1792. Of these nineteen or so children, ten lived: Schönche (1771), Amschel Mayer (1773), Salomon Mayer (1774), Nathan Mayer (1777), Isabella or Betty (1781), Breunle or Babette (1784), Kalman or Carl (1788), Gotton or Julie (1790), Jettchen or Henrietta (1791) and Jakob or James (1792).⁷

It was only after the birth of his youngest child that Mayer Amschel began to engage in business which can properly be called banking. In some ways, the transition was a natural one. An antique-dealer with a growing circle of suppliers and customers naturally would extend credit to some of these from time to time. As early as 1790 we find Mayer Amschel listed as one of the creditors of Joseph Cassel in the nearby town of Deutz, albeit for a mere 365 gulden. In a similar way, the coin and medal business inevitably brought him into contact with the Hessian mint, especially as his most coveted client, Prince William, often commissioned new medals to be struck. In 1794, for example, Rothschild offered to sell a quantity of silver to the Hessian war treasury “at the best possible price.”

However, the speed with which Mayer Amschel’s wealth grew in the 1790s marked a real break with his earlier business activity. At the beginning of the 1790s Mayer Amschel Rothschild was no more than a prosperous antique-dealer. By 1797 he was one of the richest Jews in Frankfurt, and a central part of his business was unmistakably banking. The evidence for this breakthrough is unequivocal. In 1795 the official figure for Mayer Amschel’s taxable wealth was doubled to 4,000 gulden; a year later he was moved into the top tax bracket, with property worth more than 15,000 gulden; and in the same year he was listed as the tenth richest man in the Judengasse with taxable wealth of over 60,000 gulden. Thanks largely to Mayer Amschel, the Rothschilds had become one of the eleven richest families in the Judengasse by 1800. It was at around the same time that he began to rent a large four-roomed warehouse outside the Judengasse. He also took on a talented and multilingual accountant from Bingen named Seligmann Geisenheimer. Further evidence of increased wealth can be found in the generous dowries Mayer Amschel was able to give his children as they began to marry. When his eldest daughter married Benedikt Moses Worms in 1795, she received a dowry of 5,000 gulden and was promised a legacy of 10,000 after her parents’ deaths. When his eldest son married Eva Hanau the following year, he was given a share of the business worth 30,000 gulden.

Just what such a share meant can be seen from one of the most important documents to have been found in the recently opened Moscow “trophy” archive: the first known balance sheet of Mayer Amschel Rothschild’s firm, dating back over 200 years to the summer of 1797. The total assets of the firm at this stage were given as 471,221 Reichsthaler or 843,485 gulden, the total liabilities as 734,981 gulden, leaving 108,504 gulden (around £10,000) as—in Mayer Amschel’s own words—“the balance of my capital, praise God” (“Saldo meines Vermögens, Gott lob”). This remarkable document repays close scrutiny, for it reveals that Mayer Amschel was already far more of an international merchant banker than has previously been realised. The “assets” side of the balance-sheet evidently excluded Mayer Amschel’s personal property, in that the family house does not appear there: by “my capital” he already meant his firm’s capital. Most of the assets listed were either state bonds of various sorts, or personal loans and credits to a widely dispersed range of other firms. On the other side, the liabilities consisted of sums owed by Mayer Amschel to an equally broad spectrum of institutions and individuals.

The geographical range of Mayer Amschel’s business credit network at this early stage was wide. The balance sheet shows that he was doing business with firms located not only in the immediate vicinity of Frankfurt (for example, in Kassel and Hanau) but also in more remote parts of Germany, ranging from Hamburg and Bremen to Regensburg, Augsburg, Leipzig, Berlin and Vienna, as well as in Amsterdam, Paris and London. Moreover, in addition to the names which might have been expected to feature in such a list of creditors and debtors (such as Mayer Amschel’s son-in-law Worms and his future son-in-law Sichel), there appear the names of a number of eminent Gentile firms, including the Bethmanns, de Neufvilles and Brentanos (whom he owed a good deal of money). The celebrated art-collector Johann Friedrich Städel also had deposits with Rothschild totalling 17,600 gulden. Finally, the balance sheet provides evidence of a new kind of relationship with the government of Hesse-Kassel, which he owed some 24,093 gulden. It is not without significance that the names of two Hessian officials—Louis Harnier and Karl Buderus—appear in their own right as creditors.

This was a rapid economic ascent by any standards. Indeed, Mayer Amschel’s success had been so swift and so great that it had to some extent outstripped his own capacities. In 1797 he was appalled to discover that one of his most junior employees—a youth named Hirsch Liebmann—had been able to embezzle a substantial sum virtually from under his nose. The proceedings of the subsequent criminal case have partially survived and give a good insight into the chaotic state of his rapidly expanding business at this period. According to Mayer Amschel, Liebmann, who had been with the firm some three years, had stolen between 1,500 and 2,000 gold carolins (as much as 30,000 gulden) from his office. The theft had been possible for three reasons. Firstly, Mayer Amschel allowed Liebmann to buy and sell goods on his own account to supplement his meagre wages—one and a half gulden a month after the rent of a shared room. Indeed, Rothschild even lent him a small sum on one occasion to help finance this. No one was therefore surprised when Liebmann appeared to be supplementing his wages, even if he was doing so with singular success. Secondly, the firm had no safe for valuables and scarcely any office security: the cupboard in the main office was frequently left open during business hours and employees and clients seem to have come and gone as they pleased. No one therefore noticed when coins, notes and other valuables began to disappear. And thirdly, Mayer Amschel’s system of book-keeping was woefully primitive: when he came to lay charges against Liebmann, he had virtually no documents to prove how much had been stolen. No one therefore realised that money was missing until some time after Liebmann had begun stealing. It was only when a local broker appeared in the office, claiming that Liebmann wished to buy seed from him, that Mayer Amschel’s suspicions were aroused. When pressed, the man admitted that this was a cover story suggested by Liebmann; in fact, he was there to buy an Austrian bill worth around 1,220 gulden which Liebmann had offered to sell him. Mayer Amschel belatedly grasped where his employee had been getting the money for his gold watches and handmade shirts. Further enquiries confirmed his suspicions: Liebmann had not only been spending money on himself, but also sending it to his parents in Bockenheim, who were notoriously “as poor as could be” but who suddenly seemed able to afford a 500 gulden dowry for Liebmann’s sister. When the thief was arrested, eight thaler coins and an imperial treasury note were found among his possessions, as well as some silver spoons, a gold salt pot, a gold mug and seven medals, belying his protestations of innocence. Further proof of guilt was unwittingly provided by Liebmann’s own father, who offered to return 1,000 gulden which his son had given him plus an additional 500 if Rothschild would drop his charges. Eventually, though only after prolonged interrogation, Liebmann confessed.

Liebmann gave conflicting accounts of the theft, at one point saying that he took the money in small amounts over a prolonged period, later claiming that he had simply snatched two sacks of coins from the office cupboard while Mayer Amschel’s second son, Salomon, was talking with some clients. Either way, the case illustrates that by 1797 at the latest the business was turning over so much cash that Rothschild himself could not keep track of it: bags of money were lying around the office, as he himself told the court, some in the cupboard, some on the floor. He always had a lot of money in his house, he said, because of his “extensive business dealings.” The subsequent decade would see those dealings become more extensive still.

The epoch-making events which followed the summoning of the French Estates General by Louis XVI in 1789 took time to affect the lives of German Jews like Mayer Amschel Rothschild and his family. But when finally the Revolution reached Frankfurt, its effects were profound—indeed, literally explosive. The advance guard came as early as October 1792, when French troops temporarily occupied Frankfurt, just ten weeks after the coronation of the last Holy Roman Emperor, Francis II. We should not, of course, exaggerate the significance of this superficially symbolic change of regime. Frankfurt had been occupied by French troops before (during the Seven Years’ War) and it seems that the Jewish community was no more pleased than the rest of the town’s population at this renewed foreign incursion. Indeed, for all the potential benefits of French influence which could be inferred from the National Assembly’s emancipation of French Jewry in 1791, the immediate, tangible effects of the French presence were distinctly negative. In June 1796, following the defeat of the Austrian army at Lodi, Frankfurt was bombarded by the victorious French forces so heavily that nearly half the houses in the Judengasse were destroyed by fire.⁸

On the other hand, the upheaval of war had its advantages. The destruction of the Judengasse obliged the Frankfurt Senate to relax its residence restrictions, granting permits (albeit for only six months) to the 2,000 or so people left homeless by the fire to live outside the Judengasse. It was presumably in the wake of this relaxation that Mayer Amschel was able to begin renting the warehouse in the Schnur gasse. Later French incursions led to a real, if temporary, improvement in the legal status of the Frankfurt Jews, an improvement foreshadowed by the emancipation of the Jews in those parts of the Rhineland which the French now annexed. (One beneficiary of this was Geisenheimer, the man Mayer Amschel hired as his book keeper.) Of more immediate importance, the war presented Mayer Amschel with a new and lucrative business opportunity. He and two other partners, Wolf Loeb Schott and Beer Nehm Rindskopf, were able to secure a contract to provide the Austrian army with grain and cash during their operations in the Rhine-Main region.

The French Revolution was not the only revolution to transform Mayer Amschel’s life and business. The British Industrial Revolution, in its first phase by the 1780s if not before, exerted an equally important influence. For although Mayer Amschel had already begun building up his banking business by the late 1790s, this did not imply a winding up of his previous coin-dealing business, which continued in a small way even after his death; and nor did it preclude expansion into other potentially profitable fields of business activity. Of these, none was more profitable in the late eighteenth century than that generated by the English revolution in textile manufacturing. In particular, the dramatic growth of (partly) mechanised cotton spinning, weaving and dyeing in Lancashire signalled an unprecedented and genuinely revolutionary change in the pace of economic life. Although this industrialisation was regionally as well as sectorally concentrated—so much so that it barely registers in the aggregate national income figures extrapolated by modern economic historians—its ramifications were felt as far as Africa, whence the slave labour of the cotton plantations came, America, where the cotton itself was grown, and India, where an established native textile industry was soon to face lethal competition from the cottages and mills of Lancashire and Lanarkshire. Those mills exerted a powerful pull in Germany too, where demand for the cheaper yet better British cloths—shawls, handkerchiefs, checks, gauzes, muslins, muslinettes, quiltings, dimities, velveteens, sallampores and jaconets—grew rapidly in the 1790s. Mayer Amschel was only one of many German businessmen to scent a unique and highly profitable opportunity. Around fifteen Jewish firms in Frankfurt alone were importing English textiles by the turn of the century, and a number of these established permanent agents in Britain at around this time. Between 1799 and 1803 no fewer than eight German merchants settled in Manchester for this purpose.

It is against this background that we must see the decision to send Nathan, the third of the Rothschild brothers, to England at some point on the eve of the new century. The date of his departure from Frankfurt and the reasons for his going have long been a source of confusion to historians. Although some have Nathan arriving in England in 1797, 1799 or 1800, the majority opt for 1798. There is little evidence to support this last date. We know from the balance sheet discussed above that Mayer Amschel had begun to have dealings with firms in London from at least as early as 1797, but on a fairly limited scale. It was only February 1800—the date of his first letter to the London bankers Harman & Co., requesting that he be permitted to draw on them—that he began to expand his English business. The first documentary evidence of Nathan’s presence in England comes from 1800 too. Wolf cites a letter from Nathan dated May 29 in which he requests an acquaintance to reserve “a room with two beds in it, in some respectable lodging house” for himself and his “business manager.” We also have a letter from Mayer Amschel to Harman, dated June 15, which mentions that Nathan would “soon be at your place,” and a letter from Nathan dated August 15 from a London address (37 Cornhill). From this Williams concluded that Nathan had actually arrived in England in 1800, spent the summer in London, then proceeded to Manchester. But this cannot be right. Not only was Nathan’s first letter to Harman addressed from Manchester; we also have several later letters in which Nathan explicitly states that he had first come to Manchester the year before, 1799. It therefore seems reasonable to conclude that Nathan did not arrive in Manchester before 1799, though he and his father were not doing English business on a large scale until the following year. This leaves the possibility—though it is nothing more—that Nathan first crossed the Channel in 1798, staying in London for some months before proceeding northwards.

Why did Nathan go to England? In the absence of hard evidence, most historians have followed Nathan’s own account of his emigration—which he related to the MP Thomas Fowell Buxton in 1834—in which he portrayed the decision to leave as his own:

For political reasons, it soon became imperative to conceal the fact that Nathan was acting as the agent of a Frankfurt firm, and this has led some historians to assert that, once he arrived in England, he effectively operated independently from his father and brothers. But the evidence in the firm’s archives for this period is unequivocal: initially, Nathan took his orders from Frankfurt—indeed, his elder brother Salomon was sent over to assist him in 1801—and it was only gradually that he began to trade on his own account. A number of Nathan’s earliest letters from London and Manchester are signed “pp. Meyer Amschel Rothschild.” Correspondence between father and son was evidently regular (though very little of it has survived), and Nathan wrote frequently on his father’s behalf to the London firms of Salomon Salomons and Harman & Co., which handled the firm’s insurance and banking business in London. It was not untypical for letters of this early period to begin with phrases like “My father wishes me to write to you” or “Agreeable to the direction I have just received from my father.” On one occasion when a firm let him down, Nathan warned them that if there were more “complaints of this nature . . . [I] am certain my father will order me to turn myself to somebody that will attend more punctually.” On another, he informed Salomons: “I received letters from home this morn[in]g advis[in]g me of my father being very discontented w[ith] your packing, writing that I must not send any more goods to London as you have neglected the shipping.” And for most of this period the chests of cloth which Nathan was sending to the continent in increasing quantities all bore the insignia “MAR” for Mayer Amschel Rothschild. Nathan was not sparing his father anxiety when he concealed a brief illness from him in the summer of 1802. Rather, he did not want his father to think he had been unable—for whatever reason—to attend to business. In a letter to a recalcitrant French customer not long after this illness, Nathan left for posterity a revealing insight into his father’s character, and his own view of it: “Do you think that my Father will sell . . . Goods upon his own bills . . . without Profit? You are quite mistaken, my father’s Chimney will not smoke without Profit.” Just ten days later he received a stern letter from his father accusing him of not keeping “regular” accounts.

Nathan’s slapdash approach to paperwork was evidently a recurrent source of friction. Three years after this first admonition on the subject, Mayer Amschel was still harping on the same theme, in a way which makes it abundantly obvious where power lay in their relationship. This rare letter—one of the few of Mayer Amschel’s private letters which survive—is worth quoting at some length to give a flavour of the early Rothschild correspondence:

Nor did this paternal lecture end there. Mayer Amschel went on to berate Nathan for failing to calculate his profits net (as opposed to gross); for doing business with Rindskopf in precious stones (“But you are no jeweller”) and for failing to discount bad debts:

Another possibility which has been suggested is that Nathan left Frankfurt in order to escape from the religious restrictions of the ghetto. It is true that Jews—who had been readmitted to England only in 1656 after three and a half centuries of exclusion—enjoyed far greater liberty in England than in Germany in the early 1800s. There were very few economic restrictions on Jews in England by this time,⁹ though (in common with Catholics, Non-conformists and unbelievers) they were still excluded from Parliament, local government and the universities, and, as foreigners, new immigrants were subject to increasingly stringent supervision as the war with France intensified (Jews born in Britain were British subjects). In London, confident and prosperous Jewish communities had developed during the eighteenth century including Sephardic families like the Mocattas and Ashkenazim like the merchant Levi Barent Cohen, whose father had been a successful Amsterdam linen-dealer. In the late 1790s Benjamin and Abraham Goldsmid were already playing just the sort of dynamic financial role which Nathan would later imitate with such success, challenging the dominance of the Baring brothers and their Amsterdam correspondents Hope & Co.—and incurring in the process a version of the sort of religiously tinged but essentially economic resentment we have already encountered in Frankfurt. We know Nathan had an entrée into this world through his father’s business contacts with Salomons. Yet he apparently spent no more than a few months in London when he first arrived in England, before setting off northwards to the far less socially congenial environment of Manchester, where the small and still embryonic Jewish community was overwhelmingly made up of poor shopkeep ers—dealers in old clothes, cheap jewellery, umbrellas and patent medicines. Though he was subjected to much less formal discrimination in Manchester than he had been in Frankfurt, it is hard to believe that Nathan was attracted there by anything other than business.

How successful was Nathan in what contemporaries sometimes disparaged as the “rag trade”? Very, according to his own account, thanks mainly to his own business acumen:

Nathan did not actually have to pay the bigger manufacturers until their goods were shipped for the continent. On the other hand, it was necessary to wait—usually two months—before expecting payment from Frankfurt. Obviously, the profit to be made in such a business took the form of simple percentages. However, at a time when profit margins in the textile industry could be as high as 20 per cent, Nathan’s charges were modest: 5 per cent on the cost price for purchases in cash from his warehouse, as little as 9 per cent for goods which had to be despatched to the continent. This was a deliberate ploy to attract customers and increase his market share: in his letters to potential buyers, Nathan constantly stressed that his mark-up as a middle-man was lower than those charged by his competitors. As he told his father in September 1802: “No House in Manchester purchase the Goods cheaper—if so cheap—as I do and none are at so much trouble as we are to procure them to advantage.” “You cannot find any person in Manchester who will serve you with so small a Profit as myself,” he assured one new customer. “I have the pleasure to tell you my meaning plainly, if you will do any business with me in future, you may depend that I shall send you Goods as cheap as any Person in the whole World.” Moreover, as his business expanded and he began to export to firms other than his father’s, Nathan began to offer not only low prices but also reasonable credit terms, telling the same buyer that he regarded his money as being “as safe in your hands as if I had it in my Pocket.” His continental customers were generally expected to pay with bills falling due after three months—in effect, five months after the goods had been shipped (and paid for) by Nathan. The more Nathan could pay in cash or “present bills,” the less he could pay his suppliers; the more credit he could give his customers, the more customers he attracted. This seems to have been his fundamental principle.

The practical implications of this system were, as the letter copy books of the period show, nerve-racking. To begin with, Nathan himself had to do a great deal of travelling to establish a network of suppliers and customers. As early as November 1800 he left Manchester for Scotland, where he apparently found better cloth or better prices. He returned there again in 1801 and 1805. Frequent trips to London (like the one he made in the summer of 1800 or 1801) were also necessary to maintain good relations with the bankers on whose overdraft facilities he depended. And although some buyers sent agents to Manchester, Nathan preferred to deal directly with continental firms, making at least two major expeditions across the Channel to drum up new business. The spring of 1802 saw him in France and the Netherlands, establishing links with firms in Paris, Nancy, Lyon, Liège, Metz, Brussels, Maastricht, Antwerp and Amsterdam. Before returning to England, he also went to Germany and Switzerland, securing orders from firms in Hamburg, Nuremberg, Heidelberg, Cologne, Munich, Memmingen, Salzburg, Leipzig, Königsberg and Basel. His list of customers for 1803 even included a firm in Moscow. One of the catalogues he took with him on such trips still survives and shows—on page after page studded with small squares of cloth—the extraordinary range of patterns and textures British manufacturers were able to produce.¹⁰ These absences in turn meant that a considerable amount of work devolved on his clerks, principally Joseph Barber, an English book-keeper he had hired shortly after arriving in Manchester.

Yet no amount of travelling could ensure that suppliers delivered their goods on time, or, for that matter, delivered the goods that had actually been ordered. Much of Nathan’s correspondence was therefore concerned with cajoling manufacturers to comply with his orders. At the same time, there was no guarantee that customers would always be satisfied with the goods they received, and almost as much time had to be spent in haggling retrospectively about the price and the quality of consignments. As he remarked ruefully to Geisenheimer “If I send off the goods it is two months before I can draw at 3 months date and then . . . I may be kept out of my money five or six months . . . it is very easy to get commissions but not quite so easy to get paid for them.” Nathan also had recurrent disputes with his bankers in London over their interest charges, and the very high costs of insurance which they took care of. These three pressures seem to have led to a degree of diversification on Nathan’s part. It seems that in 1801 dissatisfaction with his suppliers prompted him to become directly involved in manufacturing himself—hence the purchase of a copping machine from Boulton & Watts. Then, in 1805, he went into partnership with another immigrant from Frankfurt, Nehm Beer Rindskopf (the son of Mayer Amschel’s business associate Beer Nehm), leaving the latter to deal with sales to customers. Rindskopf soon led Nathan to diversify further, placing orders on his behalf not only for cloth but also for indigo, and later pearls, tortoiseshell and ivory (so-called colonial goods imported to Britain from her overseas empire). Finally, Nathan began to concentrate increasing amounts of his own attention on the various credit transactions generated by his business. He constantly shopped around for better borrowing and bill-discounting facilities, dealing with a succession of London bankers including Lyon de Symons, Goldsmid & D’Eliason and Daniel Mocatta, as well as continental bankers, notably Parish & Co. and the Schröder brothers. Like his father, he was gradually shifting from being a merchant to being a merchant banker.

The frenetic, hustling atmosphere of these formative years is vividly captured in the letter books of Nathan’s which have survived. In a market crowded with numerous small businesses, subject to rapid fluctuations in prices and interest rates and almost completely unregulated, it took a combination of burning aggression and cool calculation to survive and thrive. Nathan Rothschild possessed both in abundance. He was prepared, in his earliest days, to be ingratiating, on one occasion sending Salomon Salomons a cask of wine in the hope of getting better insurance rates.¹¹ But soon the brash, even bullying tone which seems to have come most naturally to him began to predominate. As early as December 1800 he could write confidently to one Scottish manufacturer with whom he had placed an order: “[P]rovided you will exert your best endeavours to please me and expeditiously, [you] may rest assured that it is in my power to furnish you regularly with considerable commissions.” Two weeks later he underlined the message: “I expect any day commis[sion]s from the Continent. I certainly shall give you the preference but wish to have the commis[sion]s you have . . . executed first before I can give you any more. You request to have 3 weeks more to execute it but the quicker you are in serving me, and the lower you do it, the more com[missions] you may depend on.” When no response was forthcoming, Nathan was indignant: “I am astonished that I have not heard from you before this. When I was in Glasgow you promised me faithfully to execute my order instantly and now it is a long while ago that I never even heard from you. If you could execute orders in a short time you might depend upon large commission for it is of no use to give commission if they are not executed by the promised time.” Another Scottish firm which delayed dispatching goods he had ordered was reproached even more forcefully:

At times, Nathan felt himself almost at war with his business rivals. He was on one occasion “surprized beyond measure to be informed of the most scandalous and unfounded reports that have been so industriously circulated in Frankfort by my enemies.” There were, he told his father, “many people in this country that would be very glad to support their own credit and character by destroying mine—But I thank God that I am so firmly established, that they cannot effect their purpose, by their wicked and weak attempts.” No doubt his rivals did seek to get the better of him. However, it is hard to avoid concluding that at times he let his combative temper run away with him. “You are a great rascal,” the Hamburg banker Behrens told him in the course of a minor spat:

His partner Rindskopf once made the mistake of criticising Nathan in the early stages of their collaboration. A subsequent letter from Rindskopf suggests that Nathan had not taken this well: “My speaking my mind openly to you proceeded from a real friendship I bear towards you and if any unguarded expression made its appearance it ought to be placed to the disappointment of the moment and by no means the fault of the Heart but on my part everything is buried in oblivion and I hope and wish you will on your part do the same and consider myself now writing to my old friend Mr Rothschild.” When a London merchant accused him of doing business with “none but swindling houses,” Nathan was incensed:

The question remains how financially successful this aggressive young man actually was. Circumstantial evidence suggests that Nathan did indeed do well. By 1804, when he was granted letters of denization, he had a house in Downing Street, Ardwick, a prosperous area of the town, as well as his warehouse in Brown Street. Four years later he owned a “large and commodious” warehouse adjoining a “spacious, modern and well built” town house at 25 Mosley Street, “the most elegant street in Manchester.” Such figures as it is possible to construct for the turnover of Nathan’s business between 1800 and 1811 (when he closed down his Manchester office) confirm the impression of rapid economic ascent (see illustration 1.ii). Indeed, if we assume that he achieved profits of, to err on the conservative side, 5 per cent on his gross sales of around £800,000 over the whole period, then his subsequent claim to Buxton that he made £40,000 as a textile merchant looks about right. On the other hand, his progress was far from being as smooth as he later claimed. As illustration 1.ii indicates, a good period beginning in early 1804 and continuing until the autumn of 1805 was succeeded by nearly two years of low turnover. This repeated itself when rapid growth in the volume of Nathan’s business in 1808 and 1809 was choked off sharply in 1810.

Such abrupt ups and downs should not surprise us. Business of the sort Nathan was engaged in was susceptible to sharp seasonal and cyclical fluctuations at the best of times; Nathan had to deal with the added disruption of intermittent war, with all the restrictions on trade between England and the continent which characterised the Napoleonic period. Even before war resumed between England and France in 1803, he had been warned of possible embargoes on cross-Channel trade.¹² The climate for business was already deteriorating in 1805, so that the formal imposition of a blockade—by the Berlin decree banning British imports to the territories under French control (November 1806)—merely set the seal on a disastrous collapse. As one correspondent lamented as early as November 1805: “The present time is the most critical and the most unhappy for the Continent . . . no trade whatsoever, the market overstocked with goods [and] no debts coming in.” At least three firms with which Nathan had dealings, including M. M. David in Hamburg, collapsed in the first months of 1806, well before the imposition of the blockade in June. Thereafter, the choice for firms like Nathan’s was between inactivity and sanctions-busting, with all the risks that entailed. In May 1806 the Admiralty took possession of five ships at Hull and seized contraband worth around £20,000 which had been purchased in Manchester by three Jewish merchants. Another, who had merely come to settle accounts with Nathan, was arrested at Stockport. The French meanwhile did the same, arresting Nathan’s new Hamburg agent Parish, who was forced to sell goods of his at a heavy loss to avoid their confiscation. The surviving letter copy books reveal that this was an especially difficult period for Nathan, as his bills became progressively harder and harder for Rindskopf to discount. As early as April 1806 Parish complained to Mayer Amschel that his son had exceeded his credit limit by drawing on them for £2,000. And by the end of August he appears to have owed Rindskopf over £28,000, on which he was paying interest at 4.2 per cent per annum. Matters were improved by the Treaty of Tilsit between Napoleon and the Tsar, reports of which reached Nathan from his brother Amschel in July 1807; but the restrictions on cross-Channel trade remained in force.

Under these circumstances, Nathan therefore had little option but to carry on his export business illegally—he became, in a word, a smuggler. In October 1807 he was sending a consignment of coffee to Sweden via Amsterdam, using an American-registered ship and fake Dutch documents. Other favoured routes for contraband were through Heligoland and the Baltic ports. Of course, such shipments could not legally be insured, so that the risks involved were very substantial. But so, presumably, were the potential rewards. By 1808 Nathan had earned a reputation as a man who had, thanks to his superior “management, judgement, foresight and connections,” regularly “succeeded in getting goods to the Continent”—though “not a word was passed about . . . how the goods had been sent.” The recovery his business enjoyed in 1808 and 1809 was short-lived, however. In September 1809 a large shipment to Riga was seized and could be released only by means of “bribery—and a heavy tax indeed it was.” Another cargo suffered the same fate at Königsberg.

The final blow came in October 1810, and it fell in Frankfurt. Ironically, by this date, the Edict of Trianon of August 5 had relaxed somewhat the ban on imports, legalising the import of so-called “colonial wares.” However, most Frankfurt firms continued smuggling, partly in order to avoid the steep import tariff imposed under the new rules, partly so that they could continue to deal in goods defined as purely British. Mayer Amschel, for example, received no fewer than seven shipments from England in July 1810 alone, worth altogether £45,000. On October 14 the Edict of Fontainebleau was published, ordering the confiscation of all English and colonial goods found to have been smuggled into French controlled territory. Two infantry regiments occupied Frankfurt and, on the basis of reports by a spy named Thiard, some 234 firms had their premises raided. Mayer Amschel was caught with 60,000 gulden of contraband on his hands, about half of it indigo, presumably sent by Nathan. Not only was the Trianon tariff levied on the goods retrospectively (a fine which cost Mayer Amschel nearly 20,000 francs); all the goods seized—worth around 100,000 gulden in all—were also publicly burnt. As one observer reported, “The extent of general confusion which this has caused beggars description.” Although Mayer Amschel got off relatively lightly—the Bethmanns had to pay a fine of more than 360,000 francs—the crisis was a watershed. Henceforth, such trade in commodities would play a declining role in the Rothschilds’ business.¹³

For Nathan, this transition had begun in October 1806, with his marriage to Hannah, the daughter of Levi Barent Cohen, a leading London merchant. Not only did this add to Nathan’s capital, to the tune of £3,248 from her dowry and a further substantial sum from his own father; it also made him the partner of one of the more eminent figures in London’s Jewish community. It was with Cohen that Nathan undertook much of his smuggling business in 1807; and, like his previous partner Rindskopf, Cohen encouraged his new son-in-law to widen the range of goods he exported to the continent to include Indian and Baltic products as well as British textiles. This was merely a stepping stone, however; for by now Nathan had made up his mind to become a fully fledged banker. In the eyes of at least one of his Manchester associates, he had already achieved this as early as 1808, though he was not yet known as such in London, having only acquired an address in the city (12 Great St Helens) that summer. Although Nathan’s earliest London ledger books suggest that he was doing banking business by 1810 at the latest, the move from Manchester was quite protracted, and it was not until the beginning of July 1811 that he was able formally to announce: