From: jeffreydanielrubard@gmail.com   
      
   On Friday, December 31, 2021 at 2:51:22 PM UTC-8, Jeffrey Rubard wrote:   
   > On Tuesday, December 28, 2021 at 2:12:35 PM UTC-8, Jeffrey Rubard wrote:    
   > > On Monday, December 27, 2021 at 10:56:06 PM UTC-8, Jeffrey Rubard wrote:    
   > > > Chapter One    
   > > >    
   > > > Duer’s Disgrace    
   > > >    
   > > > The new nation’s first financial panic was not long in coming,   
   threatening to reach its climax on the night of April 18, 1792. The shouting   
   started outside William Duer’s cell in the “New Gaol,” a debtors’   
   prison near the New York City    
   commons at the northeast corner of what is now City Hall Park. A diverse crowd   
   of three to five hundred “disorderly persons” had gathered there to   
   confront him that evening, including cart men, artisans, and slaves. What   
   began with shouts, catcalls,    
   and a few stones tossed at the prison’s windows soon escalated into an   
   old-fashioned New York riot.    
   > > >    
   > > > Colonel William Duer was nearly fifty, a small and delicate man born   
   into a wealthy English family with plantations in the Anglo-Caribbean colonies   
   of Antigua and Dominica. Educated at Eton, Duer had come to New York in 1768   
   searching for timber    
   for his family’s Dominican plantation. Seeing greater opportunities in New   
   York, he had borrowed £1,400 from his sister and established himself the next   
   year on a large plot of land along the Hudson River. With his charming wife,   
   “Lady Kitty,” he    
   had defied convention by dressing his servants in livery, creating a family   
   crest of arms, and entertaining aristocrats in a fashionable town house one   
   block north of Wall Street. As the Revolution began, he used his growing   
   social network in New York to    
   become a furnishing merchant, supplying timber, planks, and provisions to the   
   Continental army. By 1780 he was worth more than £400,000, or nearly 2   
   million. After the Revolution, he had become a member of the powerful Board of   
   Treasury under the    
   Continental Congress, a government bond dealer, and a stock market trader.    
   > > >    
   > > > But on March 23, 1792, less than a month before the fracas outside, Duer   
   had voluntarily entered the New Gaol to hide from his creditors. By ancient   
   rules of bankruptcy that still applied in New York, debtors’ prisons were   
   designed to shake money    
   out of debtors, their friends, and their families. Duer’s neighbors in the   
   New Gaol included many who had overleveraged, but no one who had leveraged so   
   much.    
   > > >    
   > > > At the height of the mayhem outside the prison, some in the crowd   
   reportedly shouted, “We will have Mr. Duer, he has gotten our money.”   
   Threatening to remove Duer bodily from his cell, the crowd began to throw   
   paving stones, breaking windows    
   and streetlamps. Well after dusk, “friends of legal restraint and good   
   order” helped the city magistrates to arrest some of the most troublesome   
   members of the crowd, including several artisans, the merchant John Hazard,   
   and Tom, a slave owned by    
   Joseph Towers. For the next few nights, crowds returned to the jail to   
   threaten vengeance. The magistrate assigned Duer his own personal guard,   
   though by the middle of April civil authorities and brick prison walls seemed   
   little protection against a mob    
   bent on repossessing the colonel’s assets in this world and sending him to   
   the next one.    
   > > >    
   > > > At the time he entered prison, it was estimated that Duer, America’s   
   first famous deadbeat, had defaulted on promises worth more than $2 million.   
   By some estimates this was more than half the nation’s supply of readily   
   available money. For    
   though the American colonies had revolted against the English crown more than   
   ten years earlier, capital, education, and power in America were still   
   concentrated among a small group of insiders. Duer was at the center of this   
   financial network, the man    
   who hired the auctioneers who sold bonds in coffeehouses and shouted current   
   prices from tree stumps on New York’s Wall Street. When he placed a bid,   
   every head turned to see which way his money was moving. In today’s   
   parlance, Duer was a market    
   maker.    
   > > >    
   > > > In the beginning of March, Duer and his associates borrowed more than   
   $800,000 to corner the market on U.S. bonds. Few understood that he had bet   
   most of his fortune. When his credit got tight later that month, he had his   
   assistants privately    
   borrow gold and silver at high interest from many of New York’s most   
   unlikely lenders. “Besides shopkeepers, Widows, [and] orphans,” wrote his   
   associate Seth Johnson, Duer owed “Butchers, Car[t]men, Gardners, market   
   women, & even the noted Bawd    
   Mrs. Macarty—many of them if they are unpaid are ruined.”    
   > > >    
   > > > In addition to the sufferers outside the New Gaol, the nation’s tiny   
   financial elite—men who spent their hours and their fortunes in the   
   coffeehouses of Philadelphia, Boston, and New York—faced financial ruin.   
   Scores of Duer’s merchant    
   friends along the Eastern Seaboard had signed now-overdue promissory notes on   
   faith under Colonel Duer’s name. Most now rued the day they had ever met the   
   man. Some disappeared into the western wilderness or crossed into Canada to   
   escape Duer’s fate.    
   > > >    
   > > > By April all five branches of the newly established Bank of the United   
   States had restricted lending. Lenders demanded immediate settlement in gold   
   and silver. Secretary of the Treasury Alexander Hamilton sought to buoy the   
   nation’s tiny stock    
   and securities market by buying back federal Treasuries, but few lenders were   
   accepting anything but gold. In May interest rates on short-term loans   
   approached 96 percent, or 8 percent per month. Soon there were rumors that   
   creditors in Connecticut were    
   demanding that Congress make good on Duer’s debts. Many doubted if the new   
   nation could survive its first financial crisis. But that is getting a bit   
   ahead of the story.    
   > > >    
   > > > How To Fund A Revolution?    
   > > >    
   > > > After Americans and British troops began to exchange gunfire at   
   Lexington and Concord in 1775, merchants with capital had to make a decision:   
   support the Revolution or support the crown? Duer and a small group of New   
   York and New England merchant    
   adventurers with names like Roosevelt, Bleecker, Melvill, and Morris threw   
   their financial backing behind the American partisans. They took enormous   
   risks in challenging the British crown, but many of Duer’s associates   
   profited handsomely by providing    
   high-interest loans to this newly formed government.    
      
   [continued in next message]   
      
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