Courtesy of The Jacob Rader Marcus Center of the American Jewish Archives , Cincinnati , Ohio at americanjewisharchives . org
Solomon Loeb Abraham Kuhn Joseph Seligman
Courtesy of The Jacob Rader Marcus Center of the American Jewish Archives , Cincinnati , Ohio at americanjewisharchives . org the southern cause , even though the Confederacy sought to maintain and expand a system of subjugation to which they surely could have related as members of an oppressed people . ( Mayer would be described later in life as an “ unreconstructed rebel .”) Many southern Jews came to accept , if not embrace , slavery — though the spiritual dissonance of this position , even at that time , was lost on no one . During one barbed congressional debate over slavery in the 1850s , an abolitionist senator inveighed against “ Israelites with Egyptian principles ”— a dart aimed at his slaverydefending colleague Judah Benjamin , the Jewish Democrat from Louisiana .
A corporate history published by Lehman Brothers in 1950 to mark the firm ’ s centennial sidesteps the question of whether the Lehmans dealt in black market cotton during the Civil War , but the considerably longer and more detailed unpublished version , titled The Seed and the Tree , leaves little doubt that they were blockade runners . The Lehmans also did considerable business with the Confederacy , landing contracts worth at least $ 200,000 to supply goods ranging from coffee and rice to the fabric used in the unifoms worn by the southern forces .
In the North , meanwhile , the firms run by Marcus Goldman , the Seligmans and Abraham Kuhn and Solomon Loeb helped to outfit Union troops . The Civil War hastened the financialization of American life , requiring largescale bond-selling operations by both sides and causing a speculative frenzy on
Wall Street , especially in the gold market , which gyrated violently based on the latest battlefront news . The Lehmans and Seligmans edged into finance during this era , respectively selling Confederate and US securities in Europe during the conflict .
Government contracts attracted droves of competitors to the clothing trade and , in the war ’ s aftermath , Solomon Loeb recognized that the “ cream was off the business ,” his son James recalled . In 1867 , he and Abraham Kuhn moved their families to New York , now the nation ’ s undisputed financial capital , forming the investment banking partnership of Kuhn Loeb . A couple years later , the Goldman clan arrived in Manhattan , where Mayer and Emanuel Lehman had also settled .
By now , a young German immigrant was drawing notice on the Street . Jacob Schiff arrived in New York in August 1865 — but not by way of steerage , like the earlier generation of bootstrapping German-Jewish immigrants who preceded him . He hailed from a prominent Jewish family whose roots in Frankfurt stretched back centuries . Religious leaders , scholars and prosperous merchants populated the Schiff family tree .
Schiff co-founded his own brokerage before he reached 20 and later married into the investment banking partnership established by his father-in-law , Solomon Loeb . To the initial horror of Loeb and the firm ’ s older and more conservative partners , Schiff piloted Kuhn Loeb directly into the turbulent realm of railroad finance .
Banker to the Pennsylvania Railroad ( then the world ’ s largest corporation ) and a great many other companies , Schiff led Kuhn Loeb to the very peak of American finance , a height he occupied with the mercurial J . P . Morgan . As the heads of two distinct Wall Street factions — Schiff , the chieftain of the ascendant German Jews , and Morgan , the leader of the blueblooded Yankee bankers with New England roots — Schiff and Morgan had a cordial relationship that belied a hint of mutual suspicion . Their firms frequently collaborated on railroad ventures and industrial offerings , generally believing it was more lucrative to work together than to engage in destructive corporate bloodletting — with one notable exception . In 1901 , Schiff , Morgan and their respective clients , railroad moguls E . H . Harriman and James J . Hill , engaged in a titanic struggle over the Northern Pacific Railway that sparked a stock market panic ( and led to Teddy Roosevelt ’ s subsequent trustbusting crusade ).
“ There is no banker in the country who is more closely identified with great corporate interests , especially railroads , than Jacob H . Schiff ,” the Wall Street Journal mused a couple of years later . One publication called him the “ uncrowned king of transatlantic finance .” Another coronated him officially . Dubbing him “ the New Money King ,” the Philadelphia Press asserted that Schiff had eclipsed Morgan : “ Both Mr . Morgan and Mr . Schiff have financed very large propositions , but it has been observed by the more powerful
18 FINANCIAL HISTORY | Spring 2024 | www . MoAF . org