Customer Reviews

Financing Anglo-American Trade: The House of Brown, 1800-1880 (Harvard Studies in Business History)

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This book is a well researched and detailed business study of the "House of Brown" how it was founded, functioned and flourished as America's first major private international banking institution during it's initial period of operation from 1800 thru 1880. It descibes how Brown Brothers {later Brown -Shipley after 1863} and its affiliates developed and maintained specialized "nitches" within 19th century Atlantic/European international trade. Thru a system of branch offices that they nurtured and developed - Baltimore, Philadelphia, New York, New Orleans and Liverpool, they gradually extended their business reach. Brown Brothers, by the mid 1840s had become a "heavyweight contender"in ranking near the pinnacle of influence, prestige and profitability with the other great private banking houses of the era - Rothschild, Baring, Peabody - Morgan, Morton- Bliss and Drexel Brothers. The role and functions of how private investment banks functioned is well detailed in an overview in chapter {1} one. The author highlights how the Brown Shipley {at different stages within this time frame} focused on four {4} main business and financial functions - the selling of government and corporate loans, the handling of private bills and foreign exchange, the making of advances to merchants and other banks to finance trade and the issuing of letters of credit was formulated, organized and refined administatively on an international basis from 1800-1880. Post Civil War [1865} Brown's concentrated more heavily on finacing trade and dealing in exchange rather than the more risky arena of financing of government and corporate loans. Brown Shipley sustained profitability during this period was due to a combination of effective leadership by the Brown family, recruitment of strong partners / agency arrangments and a conservative approach to business that eschewed higher profits at the expense of the bank reducing liquidity to unsafe levels - too bad the multi-national banks of the 2006-2009 financial bubble didn't follow their example !!!. Brown's conservative approach to always maintain a high level of liquidity thru-out this period was a major reason why the bank was able to ride out the U.S.A's "boom and bust cycles" in the 1830s, 1840s and 1850s and 1870s without seriouly disrupting its profits or prestige. The author's narrative meshes Brown's preferred specialized private banking functions with how the international banking system evolved in the 19th century and influenced Brown Shipley in its choices on concentrating its resources, expertise for its changing strategies in these areas. The book is excellent in every respect with a well written easy flowing narrative,with five {5} informative appendices and 47 pages of footnotes and bibliography. I would recommend this book for the specialist reader of 19th century private international bankING and economic history but it can also be read and enjoyed by any interested general reader. I give this book a strong 5 star rating.