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The Lords of Creation: The History of America's 1 Percent
The story of the immense financial and corporate expansion which occurred in the United States between the depression of the 1890's and the crisis of the 1930's, with an analysis of the leaders and the forces that brought boom and bust.
507 pages, Kindle Edition
First published January 1, 1935
About the author
Frederick Lewis Allen
63 books79 followersA graduate of Groton, Frederick Lewis Allen graduated from Harvard in 1912 and earned his master's from there in 1913. Allen was assistant and associate editor of Harper's Magazine for eighteen years, then the magazine's sixth editor in chief from 1941 until shortly before his death. He was also known for a series of contemporary histories that were published during a period of growing interest in the subject among the reading public.
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Displaying 1 - 30 of 33 reviews
December 26, 2013
This is a tremendous book. The topic is the financial origins of the Great Depression. Allen is a journalist and he write excellent narrative history. But he is also quite analytic. Published in 1935 it also gives an account of the Great Depression as it seemed at the time. So much of what we read about that era is shaped by Keynes. This gives a first hand impression. But its greatest strength is that it is even-handed. The subject of this book is a deep financial crisis that had very broad impacts. The fact that Allen could look at that topic in a balanced way is remarkable. ITs the best book I've read in the last ten years.
April 24, 2021
A good primer on the once and future soul of America. Lobbyists, lawyers and tailors will be back in vogue like flies on meat, like traders on a new hedging strategy. Instead of steel, railroads and oil, its big box stores, on-line retailing, data harvesting and storage, but the thrust will be the same. Back to the future, anyone?
August 17, 2022
Published in 1935, this book is an excellent history of American business and finance and its influence on American politics and society from the 1890s to the mid-1930s.
Allen chronicles how financiers, bankers, businessmen, and industrialists transformed the American economy during this period into a system dominated by Wall Street and its allies. The powerful financial and business “overlords” like J.P. Morgan, George F. Baker, and James A. Stillman engineered the vast expansion of their empires through sophisticated and often corrupt practices like multi-layered holding companies, complex financial instruments, price fixing, and stock manipulation. Although reformers tried to stem the tide of unbridled capitalism and had some success with antitrust legislation and regulation, American business continued to grow bigger and more powerful. Since the financiers and businessmen seldom considered the “public good” as a part of the business equation, it's not surprising that the economy suffered through a series of booms and busts, culminating in the “fat years” of the 1920s followed by the Great Depression of the 1930s.
Allen shows clearly how the “one percent” used wealth and privilege to mold society to their ends, but he doesn't lay the blame completely at their feet. Larger historical factors were also at work:
The overlords, to be sure, took advantage of these factors, but Allen acknowledges that these were often complex men (during this time period, all were, of course, men), many of whom were ruthless in business but devout in religious practice and generous in philanthropy.
This is a well-researched and well-written book. It's an essential read for anyone interested in the roots of the American capitalist economy as it developed from the late 19th century on. With wealth inequality at historic levels, it is worth being reminded that such inequality may be an inherent characteristic of the economic system and may not be susceptible to easy solutions. For that reason, this is a radical book, which deserves its spot on the “forbidden bookshelf.”
Allen chronicles how financiers, bankers, businessmen, and industrialists transformed the American economy during this period into a system dominated by Wall Street and its allies. The powerful financial and business “overlords” like J.P. Morgan, George F. Baker, and James A. Stillman engineered the vast expansion of their empires through sophisticated and often corrupt practices like multi-layered holding companies, complex financial instruments, price fixing, and stock manipulation. Although reformers tried to stem the tide of unbridled capitalism and had some success with antitrust legislation and regulation, American business continued to grow bigger and more powerful. Since the financiers and businessmen seldom considered the “public good” as a part of the business equation, it's not surprising that the economy suffered through a series of booms and busts, culminating in the “fat years” of the 1920s followed by the Great Depression of the 1930s.
Allen shows clearly how the “one percent” used wealth and privilege to mold society to their ends, but he doesn't lay the blame completely at their feet. Larger historical factors were also at work:
What made these vast combinations possible and profitable? Not simply the wisdom or daring of their owners and promoters, but also a number of other factors: the spread of population, the growth of cities and general urbanization of American life, the influx of immigration, the new efficiency of communication, the engineering skill which went into the design of new machinery, the labor of hundreds of thousands of workers: in short, the growth of the country and the advance of the machine age.
The overlords, to be sure, took advantage of these factors, but Allen acknowledges that these were often complex men (during this time period, all were, of course, men), many of whom were ruthless in business but devout in religious practice and generous in philanthropy.
This is a well-researched and well-written book. It's an essential read for anyone interested in the roots of the American capitalist economy as it developed from the late 19th century on. With wealth inequality at historic levels, it is worth being reminded that such inequality may be an inherent characteristic of the economic system and may not be susceptible to easy solutions. For that reason, this is a radical book, which deserves its spot on the “forbidden bookshelf.”
May 5, 2021
To understand why the Great Recession happened, start here.
Today, many Americans puzzle over why the Great Recession happened. Amazon lists more than 1,000 books on the subject. But readers today might benefit from taking a longer view. Because, as Frederick Lewis Allen told the tale in The Lords of Creation nearly ninety years ago, the conditions that arose in the Gilded Age and the Roaring Twenties and lay at the root of the Depression bear an uncanny resemblance to those of the current era beginning late in the 1970s.
When Allen’s book appeared in 1935, the United States (and the world) was in the throes of the Great Depression. The previous year the nation’s economy had begun its long, slow climb out of the depths reached in 1933. Franklin Roosevelt’s New Deal was beginning to pay off. But policymakers and the public alike yearned to understand how things had gotten so bad. And economists were almost without exception among those who celebrated the 1920s boom up until the day it went bust. So, historians like Harper’s Magazine editor Frederick Lewis Allen took up the challenge to explain what lay behind the greatest economic catastrophe in American history. He found the roots of the crisis in the emergence of the trusts, the holding companies, and stock watering late in the nineteenth century. The Lords of Creation makes the case in lively, readable prose.
Common themes in America’s economic history
“Run out and buy Europe for me.”
During the decades following the Civil War (1961-65), American business grew big. What began as small, family-owned enterprises gobbled up competitors right and left and grew into massive corporations called “trusts“—first Standard Oil, then many others in railroads, banking, utilities, and other industries. Allen notes that “by 1900 the census showed that there were no less than 185 industrial combinations in existence.” Their success boosted the economy and set off wild speculation in the securities markets. “The center of gravity of American industrial control was moving, and the direction of its movement was immensely significant. It was moving toward Wall Street.” Allen adds: “That aptest commentator of the day, Finley Peter Dunne’s ‘Mr. Dooley,’ described Morgan as now being able to say to one of his office boys, ‘Take some change out iv th’ damper an’ r-run out an’ buy Europe for me.'”
The Progressives and the muckrakers
Beginning shortly before the turn of the twentieth century, “muckrakers” such as Ida M. Tarbell and Lincoln Steffens exposed the abuses through investigative journalism. Self-identified Progressives moved to curb Wall Street’s many abuses through laws limiting the financiers’ freedom of action. And the federal government under Theodore Roosevelt, William Howard Taft, and Woodrow Wilson began to enforce antitrust law that, one by one, broke up some of the very biggest of the ventures. (Roosevelt thundered about “malefactors of great wealth,” although his efforts to do anything about them seemed half-hearted.) But the Progressive movement was spent by the 1920s. The titans of Wall Street and Big Business simply invented clever new devices to work around the laws, such as they were. And successive Republican administrations during the Roaring Twenties declined to rein in the wild speculation that led to the stock market Crash of 1929. The US government in the years leading up to 2007 was equally ineffectual, so it should be no surprise why the Great Recession happened.
Contrasting Big Business in 1929 with today’s
“In 1929,” Allen reports, “there were over three hundred thousand non-financial corporations in the country.” Today, there are 32.5 million. Then, “the biggest two hundred of these giants controlled nearly half of all the corporate wealth and did over two-fifths of the business in the non-financial field.” Now, according to Fortune magazine, “Fortune 500 companies represent two-thirds of the U.S. GDP with $13.7 trillion in revenues, $1.1 trillion in profits, $22.6 trillion in market value, and employ 28.7 million people worldwide.” In other words, despite everything done over the course of the twentieth century to regulate business, the private sector was more concentrated and the biggest companies more powerful than they’d been in 1929 after a decade of runaway speculation. Is it really hard to understand why the Great Recession happened?
Forerunners of the tech giants
Does any of that sound alien today in the age of Google, Apple, Facebook, and Microsoft? In a world where the managers of the top hedge funds take home pay of a billion dollars or more every year? Does the “pro-business” orientation of the Reagan, Clinton, Bush, and Trump administrations sound notably different from those of the men at the helm of the nation in the 1920s? And do the reforms introduced in the 1960s and under Barack Obama seem to have made enough of a difference to prevent another major economic reversal? Economists say they haven’t.
The men who defined capitalism as we know it today
Much of Allen’s argument rests on his study of the men he identifies as central to the story. Their stories are revealing as we seek to understand why the Great Recession happened. In chronicling events during the first phase of the tale, from roughly 1890 to 1920, he cites ten individuals. Fifty make the list for the period 1920 to 1935. Most of the names on the larger list have vanished into the mists of history, no doubt because with few exceptions they were all losers in the Wall Street casino of the 1920s. Not so with those Allen points to in the earlier period, whom I’ve grouped into three categories. Consider how many of these ten names are still familiar today. And take note that, with one exception, they all died at least ninety-nine years ago. Yet they all have Wikipedia entries in 2021.
The bankers
J. Pierpont Morgan (1837-1913), the grand old man of Wall Street. Allen calls him “Old Jupiter.” Architect of United States Steel, International Harvester, General Electric, and other market-dominating corporations. As Wikipedia notes, he “dominated corporate finance on Wall Street throughout the Gilded Age.” He was widely quoted to insist to an inquisitive reporter who asked him whether he owed the public an explanation about the stock market panic he had helped cause that “‘I owe the public nothing.'” His bank morphed into today’s JPMorgan Chase & Co. through many, many mergers over the years. Today, it’s by far the biggest bank in the US.
George F. Baker (1840-1931), Morgan’s right-hand-man. President of the First National Bank whom Allen describes as “solid, tenacious, and silent.” According to Wikipedia, “at his death he was estimated to be the third richest man in the United States, after Henry Ford and John D. Rockefeller.” As TIME magazine said of him in its 1924 cover story, “True, he is twice as rich as the original J. P. Morgan, having a fortune estimated at 200 millions. True, at the age of 84 when he has retired from many directorates, he dominates half a dozen railroads, several banks, scores of industrial concerns.”
James Stillman (1850-1915), “the brilliant and cold-blooded president of the National City Bank,” forerunner of today’s Citibank. Under his leadership, the bank may have become the biggest in the Western Hemisphere and was certainly the biggest in the US. As an investigation by the House of Representatives revealed, “the indirect influence of Morgan, Baker, Stillman, and their aides was prodigious.”
Jacob H. Schiff (1847-1920), German-born Jewish American banker, businessman, and philanthropist. In Allen’s words, “the shrewd and kindly head of the banking house of Kuhn, Loeb & Co.” Foremost Jewish leader in the United States for the last four decades of his life. At first, a rival to J. P. Morgan, later a close collaborator.
The industrialists
John D. Rockefeller (1839-1937), founder of Standard Oil, which trustbusters spun off into companies that today have the names ExxonMobil, Marathon Petroleum, Amoco, and Chevron, among others. The world’s richest man in his day. Some scholars estimate he would be worth $400 billion today, although I’ve seen other estimates putting the total at around $175 billion, which is slightly less than the net worth reported for Jeff Bezos of Amazon and Elon Musk of Tesla and SpaceX.
Edward H. Harriman (1848-1909), who built a nationwide railroad empire on the backs of the Union Pacific Railroad through mergers and stock market operations. J. P. Morgan called him “that little fellow Harriman.” The old man’s contempt notwithstanding, Allen points out, “Harriman may thus be regarded as two men in one—a sharp financier on the make, and an extraordinary railroad builder.” He was the father of Averell Harriman, one of the “Wise Men” who dominated US foreign policy in the 1950s and 60s.
The investors and speculators
William K. Vanderbilt (1849-1920), a grandson of Commodore Cornelius Vanderbilt. He was “the indolent chief representative of a family still powerful in the railroad and investment world.” Vanderbilt managed his family’s railroad investments and was active in horse-racing. His daughter Consuelo marrried Charles Spencer-Churchill, 9th Duke of Marlborough, a close friend of his first cousin Winston Churchill.
William Rockefeller (1841-1922), John D.’s younger brother, a cofounder of Standard Oil who turned to speculating in securities. Wikipedia: “He helped to build up the National City Bank of New York, which became Citigroup. He was also part owner of Anaconda Copper Company, which was the fourth-largest company in the world in the late 1920s.”
Henry Huttleston Rogers (1840-1909), a leader at Standard Oil and active in the gas industry, copper, and railroads. According to his biographer: “pitiless in business deals, in his personal affairs he was warm and generous.” Wikipedia: “After 1890, he became a prominent philanthropist, as well as a friend and supporter of Mark Twain and Booker T. Washington.” But in business he was contemptuous of any effort to look into his affairs. In one court case, he “refused to admit knowing where the offices of the Standard Oil Company of Indiana were” and added “‘It is quite immaterial to me what the Supreme Court of Missouri desires me to say to them, other than what I have testified.'”
James R. Keene (1838-1913), “a stock exchange operator of commanding skill and prestige.” He was a Wall Street stockbroker and, like William Vanderbilt, a major thoroughbred race horse owner and breeder.
Still famous, a century later
You’ll note that every one of these ten men was born between 1837 and 1850. And with the single exception of John D. Rockefeller Sr. (who was retired by then) they had all passed from the scene by the beginning of the 1920s. Yet even after the passage of nearly two centuries what these men did in their lifetimes set the scene for the Great Depression. And their impact has continued to the present day, when the American economy still reflects attitudes they held and legislation they influenced so very long ago. Yes, during the Progressive Era, the New Deal, and again in the 1960s and beyond, the Federal government moved to regulate the conduct of Wall Street and Big Business. But in almost every meaningful respect, the system the Robber Barons began to build in the late nineteenth century endures to this day. It’s called capitalism, and we in the United States experience a particularly freewheeling variety of the system.
About the author
For more than three decades, Frederick Lewis Allen (1890-1954) edited Harper’s Magazine. Under his aegis, Harper’s held sway as one of America’s preeminent intellectual journals. He was the author of six books of history and biography, of which The Lords of Creation was the second to be published. Allen held a Master’s degree from Harvard, where he taught for a time before his first job as an editor at age twenty-four at the Atlantic Monthly.
Today, many Americans puzzle over why the Great Recession happened. Amazon lists more than 1,000 books on the subject. But readers today might benefit from taking a longer view. Because, as Frederick Lewis Allen told the tale in The Lords of Creation nearly ninety years ago, the conditions that arose in the Gilded Age and the Roaring Twenties and lay at the root of the Depression bear an uncanny resemblance to those of the current era beginning late in the 1970s.
When Allen’s book appeared in 1935, the United States (and the world) was in the throes of the Great Depression. The previous year the nation’s economy had begun its long, slow climb out of the depths reached in 1933. Franklin Roosevelt’s New Deal was beginning to pay off. But policymakers and the public alike yearned to understand how things had gotten so bad. And economists were almost without exception among those who celebrated the 1920s boom up until the day it went bust. So, historians like Harper’s Magazine editor Frederick Lewis Allen took up the challenge to explain what lay behind the greatest economic catastrophe in American history. He found the roots of the crisis in the emergence of the trusts, the holding companies, and stock watering late in the nineteenth century. The Lords of Creation makes the case in lively, readable prose.
Common themes in America’s economic history
“Run out and buy Europe for me.”
During the decades following the Civil War (1961-65), American business grew big. What began as small, family-owned enterprises gobbled up competitors right and left and grew into massive corporations called “trusts“—first Standard Oil, then many others in railroads, banking, utilities, and other industries. Allen notes that “by 1900 the census showed that there were no less than 185 industrial combinations in existence.” Their success boosted the economy and set off wild speculation in the securities markets. “The center of gravity of American industrial control was moving, and the direction of its movement was immensely significant. It was moving toward Wall Street.” Allen adds: “That aptest commentator of the day, Finley Peter Dunne’s ‘Mr. Dooley,’ described Morgan as now being able to say to one of his office boys, ‘Take some change out iv th’ damper an’ r-run out an’ buy Europe for me.'”
The Progressives and the muckrakers
Beginning shortly before the turn of the twentieth century, “muckrakers” such as Ida M. Tarbell and Lincoln Steffens exposed the abuses through investigative journalism. Self-identified Progressives moved to curb Wall Street’s many abuses through laws limiting the financiers’ freedom of action. And the federal government under Theodore Roosevelt, William Howard Taft, and Woodrow Wilson began to enforce antitrust law that, one by one, broke up some of the very biggest of the ventures. (Roosevelt thundered about “malefactors of great wealth,” although his efforts to do anything about them seemed half-hearted.) But the Progressive movement was spent by the 1920s. The titans of Wall Street and Big Business simply invented clever new devices to work around the laws, such as they were. And successive Republican administrations during the Roaring Twenties declined to rein in the wild speculation that led to the stock market Crash of 1929. The US government in the years leading up to 2007 was equally ineffectual, so it should be no surprise why the Great Recession happened.
Contrasting Big Business in 1929 with today’s
“In 1929,” Allen reports, “there were over three hundred thousand non-financial corporations in the country.” Today, there are 32.5 million. Then, “the biggest two hundred of these giants controlled nearly half of all the corporate wealth and did over two-fifths of the business in the non-financial field.” Now, according to Fortune magazine, “Fortune 500 companies represent two-thirds of the U.S. GDP with $13.7 trillion in revenues, $1.1 trillion in profits, $22.6 trillion in market value, and employ 28.7 million people worldwide.” In other words, despite everything done over the course of the twentieth century to regulate business, the private sector was more concentrated and the biggest companies more powerful than they’d been in 1929 after a decade of runaway speculation. Is it really hard to understand why the Great Recession happened?
Forerunners of the tech giants
Does any of that sound alien today in the age of Google, Apple, Facebook, and Microsoft? In a world where the managers of the top hedge funds take home pay of a billion dollars or more every year? Does the “pro-business” orientation of the Reagan, Clinton, Bush, and Trump administrations sound notably different from those of the men at the helm of the nation in the 1920s? And do the reforms introduced in the 1960s and under Barack Obama seem to have made enough of a difference to prevent another major economic reversal? Economists say they haven’t.
The men who defined capitalism as we know it today
Much of Allen’s argument rests on his study of the men he identifies as central to the story. Their stories are revealing as we seek to understand why the Great Recession happened. In chronicling events during the first phase of the tale, from roughly 1890 to 1920, he cites ten individuals. Fifty make the list for the period 1920 to 1935. Most of the names on the larger list have vanished into the mists of history, no doubt because with few exceptions they were all losers in the Wall Street casino of the 1920s. Not so with those Allen points to in the earlier period, whom I’ve grouped into three categories. Consider how many of these ten names are still familiar today. And take note that, with one exception, they all died at least ninety-nine years ago. Yet they all have Wikipedia entries in 2021.
The bankers
J. Pierpont Morgan (1837-1913), the grand old man of Wall Street. Allen calls him “Old Jupiter.” Architect of United States Steel, International Harvester, General Electric, and other market-dominating corporations. As Wikipedia notes, he “dominated corporate finance on Wall Street throughout the Gilded Age.” He was widely quoted to insist to an inquisitive reporter who asked him whether he owed the public an explanation about the stock market panic he had helped cause that “‘I owe the public nothing.'” His bank morphed into today’s JPMorgan Chase & Co. through many, many mergers over the years. Today, it’s by far the biggest bank in the US.
George F. Baker (1840-1931), Morgan’s right-hand-man. President of the First National Bank whom Allen describes as “solid, tenacious, and silent.” According to Wikipedia, “at his death he was estimated to be the third richest man in the United States, after Henry Ford and John D. Rockefeller.” As TIME magazine said of him in its 1924 cover story, “True, he is twice as rich as the original J. P. Morgan, having a fortune estimated at 200 millions. True, at the age of 84 when he has retired from many directorates, he dominates half a dozen railroads, several banks, scores of industrial concerns.”
James Stillman (1850-1915), “the brilliant and cold-blooded president of the National City Bank,” forerunner of today’s Citibank. Under his leadership, the bank may have become the biggest in the Western Hemisphere and was certainly the biggest in the US. As an investigation by the House of Representatives revealed, “the indirect influence of Morgan, Baker, Stillman, and their aides was prodigious.”
Jacob H. Schiff (1847-1920), German-born Jewish American banker, businessman, and philanthropist. In Allen’s words, “the shrewd and kindly head of the banking house of Kuhn, Loeb & Co.” Foremost Jewish leader in the United States for the last four decades of his life. At first, a rival to J. P. Morgan, later a close collaborator.
The industrialists
John D. Rockefeller (1839-1937), founder of Standard Oil, which trustbusters spun off into companies that today have the names ExxonMobil, Marathon Petroleum, Amoco, and Chevron, among others. The world’s richest man in his day. Some scholars estimate he would be worth $400 billion today, although I’ve seen other estimates putting the total at around $175 billion, which is slightly less than the net worth reported for Jeff Bezos of Amazon and Elon Musk of Tesla and SpaceX.
Edward H. Harriman (1848-1909), who built a nationwide railroad empire on the backs of the Union Pacific Railroad through mergers and stock market operations. J. P. Morgan called him “that little fellow Harriman.” The old man’s contempt notwithstanding, Allen points out, “Harriman may thus be regarded as two men in one—a sharp financier on the make, and an extraordinary railroad builder.” He was the father of Averell Harriman, one of the “Wise Men” who dominated US foreign policy in the 1950s and 60s.
The investors and speculators
William K. Vanderbilt (1849-1920), a grandson of Commodore Cornelius Vanderbilt. He was “the indolent chief representative of a family still powerful in the railroad and investment world.” Vanderbilt managed his family’s railroad investments and was active in horse-racing. His daughter Consuelo marrried Charles Spencer-Churchill, 9th Duke of Marlborough, a close friend of his first cousin Winston Churchill.
William Rockefeller (1841-1922), John D.’s younger brother, a cofounder of Standard Oil who turned to speculating in securities. Wikipedia: “He helped to build up the National City Bank of New York, which became Citigroup. He was also part owner of Anaconda Copper Company, which was the fourth-largest company in the world in the late 1920s.”
Henry Huttleston Rogers (1840-1909), a leader at Standard Oil and active in the gas industry, copper, and railroads. According to his biographer: “pitiless in business deals, in his personal affairs he was warm and generous.” Wikipedia: “After 1890, he became a prominent philanthropist, as well as a friend and supporter of Mark Twain and Booker T. Washington.” But in business he was contemptuous of any effort to look into his affairs. In one court case, he “refused to admit knowing where the offices of the Standard Oil Company of Indiana were” and added “‘It is quite immaterial to me what the Supreme Court of Missouri desires me to say to them, other than what I have testified.'”
James R. Keene (1838-1913), “a stock exchange operator of commanding skill and prestige.” He was a Wall Street stockbroker and, like William Vanderbilt, a major thoroughbred race horse owner and breeder.
Still famous, a century later
You’ll note that every one of these ten men was born between 1837 and 1850. And with the single exception of John D. Rockefeller Sr. (who was retired by then) they had all passed from the scene by the beginning of the 1920s. Yet even after the passage of nearly two centuries what these men did in their lifetimes set the scene for the Great Depression. And their impact has continued to the present day, when the American economy still reflects attitudes they held and legislation they influenced so very long ago. Yes, during the Progressive Era, the New Deal, and again in the 1960s and beyond, the Federal government moved to regulate the conduct of Wall Street and Big Business. But in almost every meaningful respect, the system the Robber Barons began to build in the late nineteenth century endures to this day. It’s called capitalism, and we in the United States experience a particularly freewheeling variety of the system.
About the author
For more than three decades, Frederick Lewis Allen (1890-1954) edited Harper’s Magazine. Under his aegis, Harper’s held sway as one of America’s preeminent intellectual journals. He was the author of six books of history and biography, of which The Lords of Creation was the second to be published. Allen held a Master’s degree from Harvard, where he taught for a time before his first job as an editor at age twenty-four at the Atlantic Monthly.
November 4, 2020
Interesting and detailed
An interesting account of the vast boom in the first couple of decades of the twentieth century and the vast deep crash of the third. Written in 1935.
Raw unregulated capitalism, frenzied speculation, outright lies, propaganda and corruption. And above all the rich getting richer until their unfettered irrational greed brings the whole thing crashing down.
Sounds familiar.
An interesting account of the vast boom in the first couple of decades of the twentieth century and the vast deep crash of the third. Written in 1935.
Raw unregulated capitalism, frenzied speculation, outright lies, propaganda and corruption. And above all the rich getting richer until their unfettered irrational greed brings the whole thing crashing down.
Sounds familiar.
April 24, 2021
Excellent treatment of the “makers” and “job creators” of yesteryear. Some of them really were job creators, and they were surrounded by, as you might expect, the usual coterie of sycophants and cozeners, who preyed on whomever they could like the “heroes” of Auschwitz (i.e., read Primo Levi). After the crashes, some of them did eventually go to jail, like the guys at SAC.
May 8, 2018
Fascinating insight into the lifestyles and the mentality and the sheer drive of some of the big players in the US around the turn of the century. It further strengthens my belief that capitalism is a system that can never be in harmony with the proletariat and should be abolished by either Revolution or Radical Reforms.
March 5, 2020
I really, really enjoyed this one. It headlines as an examination of the Gilded Age industrialists and the men providing them capital—names like Morgan, Schwab, Carnegie, Rockefeller, Gates, Harriman, Hill, Ford, and so on—but Allen covers far more ground than that. He begins in the year 1900 with the story of J.P. Morgan’s buyout of Carnegie to form U.S. Steel, then moves through the decades in the run-up to the crash of 1929.
His portraits of these men are biographical writing at its peak. Take this paragraph on Charles Mitchell for example, who was the head of National City Bank (now Citibank) and could be considered the original Wolf of Wall Street as he pioneered the aggressive sales of securities to the general public.
"What had brought him so far in such a brief span of years? Inexhaustible energy, a restless imagination, a powerful faculty for concentration; that talent for organizing and stimulating the efforts of other people which we call executive ability; that specialized and commercialized variety of the talent for persuasion which we call salesmanship. Mitchell was a big man physically, solid and broad-shouldered, with a strong face: bold jaw, blunted nose, stern mouth, keen eyes: the face of a man, not of sensibility, but of gross power. He believed in keeping fit—for years he walked every morning the whole seven miles from his house in the east Seventies to the National City Bank. He worked mightily, studying, learning, and not forgetting that social contacts of the right sort can be very valuable to a rising financier. His confident energy galvanized other people. There flowed from him the sort of vital personal force which enables a military commander to rally his men for a successful assault-a force which the accidents of circumstance, in an acquisitive society, directed into rallying bond salesmen. When, like Napoleon upon a hilltop, Mitchell looked down from the windows of the Bankers' Club upon the field of campaign, he showed his lieutenants not an armed enemy but a host of sales prospects, millions of dollars strong."
Allen moves effortlessly from miniature biographical studies to technical explanations of the financial market machinations that cropped up as these kingpins expanded their empires. But perhaps most important, he paints of picture of the social fabric of the era which gives a true atmosphere to the book. Having been published in 1935, it has a credibility that comes with his proximity to the time.
Something I got a good kick out of is Lewis’s personal slant. At its mildest, you could call it resentment. It could be called downright vindictiveness. You can tell he is trying his hardest to keep it subterranean, but he just can’t help himself. Where it shows most frequently is in his use of nicknames, like calling Harriman “a little bespectacled man” or calling Schwab, “Carnegie’s whiteheaded boy” or my favorite, referring on one occasion to Samuel Insull as “Samuel Insult”. I don’t think it was a typo. He usually tries to recover his neutrality after one of these jabs, quickly following with a word of praise for his character or patience or foresight or something like that, but the cat can't be stuffed back into the bag at that point. Though, since he lays out the facts of their behavior, and knowing the consequent fallout, it’s hard to say its undeserved.
His portraits of these men are biographical writing at its peak. Take this paragraph on Charles Mitchell for example, who was the head of National City Bank (now Citibank) and could be considered the original Wolf of Wall Street as he pioneered the aggressive sales of securities to the general public.
"What had brought him so far in such a brief span of years? Inexhaustible energy, a restless imagination, a powerful faculty for concentration; that talent for organizing and stimulating the efforts of other people which we call executive ability; that specialized and commercialized variety of the talent for persuasion which we call salesmanship. Mitchell was a big man physically, solid and broad-shouldered, with a strong face: bold jaw, blunted nose, stern mouth, keen eyes: the face of a man, not of sensibility, but of gross power. He believed in keeping fit—for years he walked every morning the whole seven miles from his house in the east Seventies to the National City Bank. He worked mightily, studying, learning, and not forgetting that social contacts of the right sort can be very valuable to a rising financier. His confident energy galvanized other people. There flowed from him the sort of vital personal force which enables a military commander to rally his men for a successful assault-a force which the accidents of circumstance, in an acquisitive society, directed into rallying bond salesmen. When, like Napoleon upon a hilltop, Mitchell looked down from the windows of the Bankers' Club upon the field of campaign, he showed his lieutenants not an armed enemy but a host of sales prospects, millions of dollars strong."
Allen moves effortlessly from miniature biographical studies to technical explanations of the financial market machinations that cropped up as these kingpins expanded their empires. But perhaps most important, he paints of picture of the social fabric of the era which gives a true atmosphere to the book. Having been published in 1935, it has a credibility that comes with his proximity to the time.
Something I got a good kick out of is Lewis’s personal slant. At its mildest, you could call it resentment. It could be called downright vindictiveness. You can tell he is trying his hardest to keep it subterranean, but he just can’t help himself. Where it shows most frequently is in his use of nicknames, like calling Harriman “a little bespectacled man” or calling Schwab, “Carnegie’s whiteheaded boy” or my favorite, referring on one occasion to Samuel Insull as “Samuel Insult”. I don’t think it was a typo. He usually tries to recover his neutrality after one of these jabs, quickly following with a word of praise for his character or patience or foresight or something like that, but the cat can't be stuffed back into the bag at that point. Though, since he lays out the facts of their behavior, and knowing the consequent fallout, it’s hard to say its undeserved.
January 18, 2020
Good read to better understand many of the causes of the Great Depression. Allen never took "sides", only put forth what he saw as the causes, and did it in a nonpartisan way. Not bad for being written in 1935 in the middle of the recession.
January 3, 2020
This is one of my branching-out books, one of those periodic attempts to read something other than fantasy and science fiction. And I had my doubts, considering I generally find business writing to be dull as ditch water, but such is not the case here. It's a shame he's long dead, and thus unable to address current events, because Allen is an excellent writer - clear, approachable, often dryly funny, and he is clearly writing for a general audience so he explains everything as he goes in the most lucid way. If more authors wrote about business like this I might be inclined to read more of it.
Anyway, this book was published in 1935, and it covers the financial history of the economic powerhouses of America, from the 1890s up until about the time of publishing. It is both surprisingly interesting and surprisingly familiar. As Gretchen Morgenson states in her Introduction, a lot of the greed, rapacity, flexible ethics, and incestuous economics that is often observed today is here as well... in fact the implication is very strong that because the early problems weren't sufficiently well dealt with, the ability of the very rich to exploit everyone else through unethical - if not actually illegal - business practices goes largely unchecked and keeps on repeating itself. Given the time that Allen is writing in, the stock market crash of 1929 looms large as a potential outcome of such determinedly piggish troughing, as economic houses of cards collapsed under the weight of their own overreach and fictional leverage. It's an honestly entertaining read, but still a bit depressing to see how little has largely changed.
Anyway, this book was published in 1935, and it covers the financial history of the economic powerhouses of America, from the 1890s up until about the time of publishing. It is both surprisingly interesting and surprisingly familiar. As Gretchen Morgenson states in her Introduction, a lot of the greed, rapacity, flexible ethics, and incestuous economics that is often observed today is here as well... in fact the implication is very strong that because the early problems weren't sufficiently well dealt with, the ability of the very rich to exploit everyone else through unethical - if not actually illegal - business practices goes largely unchecked and keeps on repeating itself. Given the time that Allen is writing in, the stock market crash of 1929 looms large as a potential outcome of such determinedly piggish troughing, as economic houses of cards collapsed under the weight of their own overreach and fictional leverage. It's an honestly entertaining read, but still a bit depressing to see how little has largely changed.
February 1, 2017
The detailed story of the late 19th and early 20th century lords of industry in the United States. Mr. Allen describes a nuances history of early American industrialization and the first and second generation "Masters of the Universe" on Wall Street. While the author expresses sympathy for the working man and the victims of economic machinations, he also portrays the industrialists and financiers as complex men who cannot be easily labeled as good or evil. These men of Wall Street often abused their power and fleeced the less savvy investor, their behavior must be examined in the ethic of the day and the mindset of Laissez Faire capitalism. Of course, many of the contemporary politicians and labor leaders called out heartless behavior. But these men surrounded themselves with a social and economic class of equals who were far less harsh in their assessment and often viewed each others behavior as virtuous and with a sense of noblesse oblige aimed at the growth of a nation.
October 4, 2020
Few takeaways:
- By 1935, most upper class citizens mostly recovered from the depression and were doing better than when the New Deal was first introduced.
- Only when the tide goes out do you discover who's been swimming naked: while many upper class recovered, some former upper class didn't and their demise were rather "audible".
- Big corporations recovered by 1935 - controlled 49% wealth in 1929 to around 55% wealth in 1932 - but small businesses didn't.
- Technological advances (namely "machinery") was expedited in implementation during the Great Depression and replaced more workers.
- Lower and Middle Class didn't fare so well as their upper class counterparts.
- By 1935, most upper class citizens mostly recovered from the depression and were doing better than when the New Deal was first introduced.
- Only when the tide goes out do you discover who's been swimming naked: while many upper class recovered, some former upper class didn't and their demise were rather "audible".
- Big corporations recovered by 1935 - controlled 49% wealth in 1929 to around 55% wealth in 1932 - but small businesses didn't.
- Technological advances (namely "machinery") was expedited in implementation during the Great Depression and replaced more workers.
- Lower and Middle Class didn't fare so well as their upper class counterparts.
November 1, 2021
A surprisingly engaging narrative. Written in 1935 and recently re-issued, this book examines the multitudinous events that influenced and led up to the fevered economy of the late 1920s and the crash that followed. He starts well back, in the 1870s and 1880s, and describes with admirable clarity the leading men (no women, of course), the general zeitgeist, and the remarkable manipulations that gradually built up to the Jenga tower of 1929. Many of the individuals, such as J.P. Morgan and Theodore Roosevelt, were fascinating and Allen tells their stories very well. As he leads us step by step through the careers of these men, the opportunities seized, the repeated sequence of exploitation, overreach, panic, disaster, attempted regulation, and evasion, there are many points that resonate most uncomfortably with much more recent events. Allen remarks more than once that corporate lawyers tend to be two steps ahead of government controls, and in one place he observes, "The power of governmental regulation depends upon the vigilance, imagination, and honesty of officials - very variable qualities, all of them". Sigh. Very worthwhile read.
February 17, 2024
This is an extremely valuable book in part because it was written so close to the history it covers and because it seems to be very well balanced. There is a lot that I didn't exactly get because I'm not business minded, but I understood the basic concepts. It's something I'd really have to listen to again to grasp more fully.
I particularly appreciate the way the author paints the figures as complex individuals rather than just demonizing them, even if he is very critical of their actions at times.
I particularly appreciate the way the author paints the figures as complex individuals rather than just demonizing them, even if he is very critical of their actions at times.
March 5, 2021
Historical Economic book 1870 - 1935.
The Great Depression. US setting.
Very informative. Non-bias. Well written.
Hard to believe this book was written during Depression.
Great ending to allow for critical analysis and hindsight.
Hard to make conclusions in 1935 but maybe we can now.
Slow read; long book.
The Great Depression. US setting.
Very informative. Non-bias. Well written.
Hard to believe this book was written during Depression.
Great ending to allow for critical analysis and hindsight.
Hard to make conclusions in 1935 but maybe we can now.
Slow read; long book.
November 18, 2018
Frederick Lewis Allen was an excellent researcher of historic and financial facts, with that being said this would have been a better read if it was three separate books. Too much reflection and comparison of the financial and social happenings between 1908, 1929 and the good years in between.
April 10, 2021
An entertaining and thoughtful overview of the political and economical situation in the United States in the decades leading to the Great Depression. The details about the growth in investment banking and what those transactions worked like are specially interesting.
January 28, 2019
The lead up to the financial crisis in the 1930's. The book was written in the '50's but still awesome today.
April 27, 2019
I read enough of it. You can only read so much of depressing information but it is good to know for better or worse.
August 13, 2019
An extremely fair accounting of the time period. Wasn't sure what type of balance it would strike but it's exceedingly fair. Recommend it to anyone interested in politics or business or history.
Read
August 18, 2019Excellent book about the early 1900 economic situation and the greed that was so pervasive in shaping America’s fortunes. A must read for anyone who wants to understand our present economy
August 27, 2020
Must read to understand today's robber barrons
January 11, 2022
Very Dry Read
Very difficult to read. It took me over a year to finish it. It was like.reading a text book.Happy to be done with it.
Very difficult to read. It took me over a year to finish it. It was like.reading a text book.Happy to be done with it.
Read
September 5, 2022Interesting, important read, yet tedious at times. It’s a long one.
November 16, 2022
Learning about history by reading old books helps to put today into an interesting perspective.
November 20, 2022
A well researched review of the original market collapse. Like reading a collection of stories and synthesis from a pandemic 100 years ago; reading about the market collapse a 100 years ago are vitamin and minerals to a heathy recovery. Nothing softens the journey, but it reminds one there are ups and down to be had.
July 30, 2019
Great read thought provoking
August 16, 2014
An easy-to-read, yet comprehensive, overview of the vast expansion of corporations and finance in the US between the 1890’s and the 1930’s. There are fascinating vignettes of selected “captains of industry and finance”, many of whom were born into poverty but had the skill and the drive to learn the financial tricks and became billionaires. Financial malpractice was egregious and rampant and lead directly and repeatedly to economic crises. Lessons learned, if any, were soon forgotten or ignored. Today, in 2014, one can see the same self-serving financial greed in action. Excessive speculation in dubious financial instruments follows a pattern similar to the excesses of the 1920’s.
July 8, 2016
Extremely well-written book from 1935 that describes the boom and crash of 1929. More even-handed than I would have liked as the author gives the major bankers more a break than I would but does give many examples of the pyramid schemes, commercial banks also having an investment bank and what results. Mentions Cambridgeport in a quote and also George F. Johnson and ? Endicott as being more supportive of their workers which was not usually the case.
His prediction is not overly optimistic.
His prediction is not overly optimistic.
July 25, 2020
The men at this time ( had lot's of money) and they wheeled like a gun. They would do whatever it took too get what they wanted. Frederick Lewis Allen had a understanding of wall street. I did not finish reading the book because to much wall street
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