1/ Hetty: The Genius and Madness of America's First Female Tycoon (Charles Slack)

Thread with quotes

"At the time of her death in 1916, Hetty Green was the wealthiest woman in America. She left a fortune estimated at $100 million ($1.6 billion today)."

https://www.amazon.com/Hetty-Genius-Madness-Americas-Female-ebook/dp/B004G5ZU2I/

2/ "At a time when the rich were so extravagant that their spending gave the Gilded Age its name, Hetty Green had a hard time spending a quarter. She took public transportation back to her small flat in unfashionable Hoboken, New Jersey, or Brooklyn."

3/ "Hetty’s madness, such as it was, served a vital purpose. By casting off the trappings and social expectations of her time, she freed herself to do as she pleased, to live life on terms that she and she alone determined."

4/ "Unlike Carnegie, Morgan, and Vanderbilt, who transformed their spotty reputations through philanthropy, Hetty Green left no monuments to herself. She therefore left it up to others to determine determine her legacy—and this process has not been kind to her."

5/ "From a young age, Hetty read the financial news to her father and her grandfather.

"By the time she was fifteen, by her own reckoning, she knew more about finance than many financial men."

Hetty: “My father taught me never to owe anyone anything. Not even a kindness.”

6/ "The first great oil fortunes in the United States were established by New England mariners.

"America ran on the by-products of slaughtered whales. Their oil lubricated watches, clocks, and guns. Wealthy young women wore corsets of whalebone and perfume containing ambergris."

7/ "Quakers believed in humility, thriftiness, hard work, plain dwellings, and modesty in dress and behavior. They had no idea what to do when they found themselves rich from whale money.

"Hetty was never devoutly religious, but traditions of Quaker living filtered down to her."

8/ "She received an allowance of $1.50 per week, but, unlike other children with money in their pockets, she showed no desire to spend it. When she was eight, she later claimed, she marched down to a local bank, savings in hand, and opened her first account."

9/ Hetty: "As a child, I was required to read the reports of the stock markets and of various business transactions to my father, who would carefully explain to me those things I did not understand. I was also obliged to keep a strict account of personal and household expenses."

10/ "Hetty was particularly lovely: tall, full-figured, large blue eyes, a long, straight nose, prominent chin, and generous brown hair. Her favorite place was with her father in the counting house or the docks; at times, she used waterfront language that shocked genteel souls."

11/ "Her father sent her $1,200 with instructions to properly outfit herself with dresses and gowns for the social season. Hetty spent only $200 of the money. She put the rest into the bank upon her return to New Bedford."

12/ "The discovery of oil in Pennsylvania, combined with new refining techniques, promised a new and seemingly inexhaustible supply of oil that didn’t require costly, dangerous voyages on the far seas. But another factor greatly hastened the downfall of whaling—the Civil War.

13/ "Whalers fortunate enough to assemble working crews found themselves besieged by Confederate raiders, who destroyed no fewer than twenty-five New Bedford ships, seizing or destroying a half-million dollars’ worth of oil.

14/ "But the coup de grace came from the Union. In 1861, the U.S. Navy commandeered thirty whalers, filled them with stone, and sank them to blockade Southern shipping. The terrible truism that war is good for the winning side’s economy never played out in New Bedford.

15/ "Some New Bedford whaling men, attached to the city and to their way of life, would ride the industry down to its bitter end in the early 1900s, sending fewer and fewer ships out to hunt ever more elusive whales, for an oil that the world no longer wanted."

16/ War seems to be bad for almost everyone's safety and wealth, regardless of how much money people start with or who ends up winning.

Barton Biggs tells the story of World War II and its impact on wealth here: https://twitter.com/ReformedTrader/status/1283459219300048897

17/ "Hetty's miserliness point to an abject unwillingness to enjoy indulgences that even members of the middle class took for granted. Her concern with Sylvia’s money grew out of her obsession to protect the family fortune, money that would not be safe until it was in her hands."

18/ "When women were presumed to have no head for money, trust funds were created for them as a matter of course. But a young woman weaned on financial papers, who started her own bank account at eight, who stashed away money given to her to buy dresses, was no ditzy heiress."

19/ "Robinson had been wholly aware of Hetty’s consuming interest in finances.

"But he followed the conventions of the day and kept 80% of his fortune in trust for her so she would not fritter it away. Hetty could interpret the will as nothing but a deep and burning insult."

20/ "Hetty sat stewing in a silent rage as she listened to each provision [of aunt Sylvia's will].

The news that she would receive lifetime income on a $1 million trust did not move her. All she could hear was a litany of insults large and small. She was to receive no cash.

21/ "She was to be less trusted to handle money than widows who received direct cash payments of $10,000. The greatest outrage was that the hated Dr. Gordon would serve as one of the trustees. He would make financial decisions for her and reap thousands each year in commissions."

22/ "With the exception of their mutual affection for money, Edward and Hetty had little in common. Their differences would intensify and make them both frequently miserable. The Quaker traditions that drove Hetty to deny herself luxuries were utterly lost on Edward Green."

23/ "Hetty was already establishing the patterns of investment that would define her career, sticking with conservative instruments and having the cool head to stay on course when others panicked.

"From 1865, Hetty had been buying up United States “greenback” notes.

24/ "The government had printed large quantities after the Civil War to cover huge expenditures. The Union had won military victory, but people were still quite apprehensive about the economic prospects of the ragged and still-fragile reunified country.

25/ "Unease caused a rush to gold, and the greenbacks dropped to as low as forty or fifty cents on the dollar of gold. While others lost their nerve and sold greenbacks, Hetty bought.

"She claimed in a single year to have made $1.25 million from her bond investments alone.

26/ "Her father’s estate of $5 million, even under management she openly detested, yielded several thousand dollars/week. She was able to put all of this money to work, investing and reinvesting principal and income. Within a few years her fortune doubled, tripled, quadrupled.

27/ "Her holdings were growing larger than those of banks. Banks in need of cash sold Hetty loans they had made using property as collateral. When some of the borrowers defaulted, Hetty accrued property. This was the beginning of what would become a real estate empire.

28/ "Banks had extended loans to hundreds of railroads, in various states of completion—some amounting to little more than grand words in a prospectus. Bonds for these railroads flooded the market. In the fall of 1872, within less than three months, three major U.S. banks failed.

29/ "Other banks soon suspended operations. To stem the panic, the New York Stock Exchange closed for ten days. The distress that lingered through the entire next year became known as the panic of 1873. Before it was over, some eleven thousand companies had failed."

30/ "At forty-one, Hetty still had a pretty face and a fine complexion, but her dress was homely. Her hair looked as though she hadn’t given it a thought. She spoke not in the low, regal manner, but in harsher, earthier tones, and, when angered, could cuss like a dockworker."

31/ "Hetty's precipitous time was January 1885, when Cisco and Son, where Edward invested and where Hetty kept her securities, collapsed.

"Hetty’s life would never be the same. After the Cisco failure, she would declare independence from her husband and war on the world.

32/ "Cisco went to greet her and learned that her parcel contained $200,000 in bonds. “Don’t you think it was risky to have brought these in a public stage? You should have taken a carriage.”

"Hetty arched her eyebrow. “Perhaps you can afford to ride in a carriage. I cannot.”

33/ "Hetty trusted the bank’s conservative, staid reputation enough to place her securities there for safekeeping.

"But as managers, the junior Cisco and Foote were less cautious and conservative than the elder Cisco.

34/ "The bank had been financial agents for the Houston and Texas Central Railroad. Cisco and Foote also bought heavily in the railroad’s bonds on behalf of the bank.

"No sooner had the sale gone through than Huntington shocked investors by defaulting on a bond payment.

35/ "Word that Cisco and Son was in trouble spread around Wall Street.

"The bulk of Hetty's fortune—her securities—was not exposed, but her cash deposit of $550,000 might be in jeopardy. She demanded that the entire deposit be transferred at once to the Chemical National Bank.

36/ "But while Hetty was the largest depositor, Edward Green was its largest debtor.... an all too familiar tale of a man chasing one doomed investment after another in a desperate bid to recapture a lost fortune.

"Now Cisco and Foote asked Hetty to make good on the debt.

37/ "Her husband’s finances were his own affair. She had no intention of covering loans she'd not taken out. Should the bank refuse to release her money at once, she would sue.

"When Foote and Cisco received this missive, they took what they saw as their only remaining recourse.

38/ "It announced that it was suspending operations. Then as now, bad news was usually relayed after the close of the business day.

Despite the rumors, the announcement took Wall Street by surprise. Cisco and Son was known as conservative, not given to rash speculation.

39/ “The fact that the firm received very large deposits from innumerable persons and corporations, acted as fiscal agent for railroads and correspondent for out-of-town bankers, and issued letters of credit to travelers in Europe made the failure a more than ordinary disaster.”

40/ "Hetty cared far less what people were saying of her than she did about the fate of her money locked away at a now-bankrupt firm.

"She threatened, screamed, and pleaded, stomping her foot and sobbing. Bystanders gathered at the windows of the Cisco headquarters to watch.

41/ "She demanded to examine the securities. May agreed. Hetty sat for several hours, meticulously counting, and found to her relief that nothing had been taken.

"The prospect of having no control over her fortune for weeks or even months at last wore Hetty’s resistance down.

42/ "In February, she forced herself to scrawl out a check [to cover her husband's debt]. She also agreed to relinquish half of her deposit. Her total payment was $702,159.04.

"With that, she packed up her securities and took them to the offices of the Chemical National Bank.

43/ "Hetty had had enough of convention; she had had enough of the masquerade of herself as the dutiful wife and Edward as the financial brains. He had violated a trust through his mismanagement of money. He had not simply squandered his own fortune; he had sliced into hers.

44/ "Even at his most confident and robust, Edward was hardly a match for Hetty’s steel-minded determination.

"He was left, for all intents and purposes, a broken man, without money of his own, reduced to a sort of genteel subsistence."

45/ "For every strong, healthy railroad with sound management there were many more that failed for mismanagement, natural obstructions, or fraud. Corrupt politics, panics, and a shaky money supply left a financial landscape strewn with corpses. One of them had been Edward Green."

46/ "When Hetty left Bellows Falls, she did not erect a mansion next to the Vanderbilts, although she could have afforded a home as fine as the finest on Millionaire’s Row. She chose instead the teeming, dense borough of Brooklyn, populated by immigrants and laborers.

47/ "She rented apartments in hotels and rooming houses, usually paying by the month. A large house, beyond the price to buy or build it, would mean an endless stream of payments for upkeep and a staff of servants. And there was another reason.

48/ "In order to collect personal property taxes, collectors first had to establish proof of residency. By paying monthly rent and moving frequently, Hetty preserved the ability to deny that she lived in any given city or state whose tax collectors became too persistent.

49/ "While they were among America’s richest children, Ned and Sylvia were more akin to those constantly struggling for the next meal.

"Hetty never failed to tell them how rich they would be one day, and she meant it. Her goal was to leave them as the richest people in America."

50/ "Hetty rarely lost sleep worrying what others thought of her, and yet there was a certain irony in the public’s reaction to her. For all of her faults, she was no snob. She sneered at all forms of pretense and was unimpressed with titles.

51/ "She didn’t just mix with the common folk; she lived among them, ate at their restaurants, rode their streetcars and ferries.

"Yet it was her very reluctance to live like a queen that evoked derision... the public never seemed to begrudge Carnegie his sixty-four-room house."

52/ "Hetty lived her life convinced that she was fundamentally alone. She mistrusted all forms of alliances and cabals.

"Where other investors sought the safety of numbers, the soothing ring of consensus, Hetty felt most comfortable trusting her own judgment and instincts."

53/ "She was a free agent in the truest sense of the term, and anyone going into a deal assuming he had Hetty Green in his corner, or that she could be pushed, harassed, or cowed into going along with a crowd, learned difficult and expensive lessons to the contrary."

54/ "Money gave her power over men, companies, and markets, yet she never proclaimed herself an advocate of women’s rights.

"When it came to deciding which of her children would succeed her handling the family fortune, her choice couldn’t have been more conventional: it was Ned.

55/ "Though Hetty intended for her children to share equally, she expected Ned to act as shepherd of the fortune. As Ned entered adulthood, Hetty prepared a trial by experience, thrusting him into positions where he could make decisions without jeopardizing too much real money."

56/ NOTE: This book has stories about Hetty's shrewdness, sharp wit, vindictiveness, protective nature regarding her children, and conflicts with powerful characters like C. P. Huntington.

These were great and had me laughing out loud (but were, sadly, too long to summarize).