down on a hotel bed—where he had registered under an assumed name—with the gas on. Goldman got its money back as a preference to other creditors because it had made a short-term loan to the manufacturer.
In 1894,Harry Sachs, Sam’s brother, joined the firm and the five partners, ten clerks, and a handful of messengers settled into second-floor offices at 43 Exchange Place. At that time, Goldman Sachs had $585,000 in capital and an annual profit of $200,000, areturn on equity of an astounding 34.2 percent and an early indicator of how profitable the business could be when managed properly. In 1896, Goldman Sachs joined theNew York Stock Exchange. By 1898, the firm’s capital stood at $1.6 million and was growing rapidly.
At that time, the firm also decided to open a foreign exchange department and by June 1899 had sent $1 million worth ofgold coins to Europe. Some dealers thought the firm had mispriced the shipment and lost $500, but Marcus Goldman said that it was “a regular and profitable operation” and done because gold coins “were cheaper” than bills of exchange. During the next few years, Goldman Sachs—along with Lazard Frères & Co., another small banking partnership with a Wall Street business—were among the largest in the business of importing and exporting gold bullion. It wasn’t all business at Goldman Sachs either: Goldman’s employees—with last names like Gregory, Hanna, Odz, Keiser, and Morrissey—were also regular tenpin bowlers in theBank Clerks’ League.
Marcus Goldman was also developing a reputation as a small-scale philanthropist, especially for causes involving the “Hebrews,” as Jewish immigrants to the United States were then known. In 1891, Goldman was part of leading an appeal—apparently the first of its kind—for general succor, “irrespective of creed or religion” of the donors, to JewishRussian immigrants to New York City who had arrived in the United States “well nigh penniless.” Some 7,500 Russians were then coming to Ellis Island monthly, “not willingly, nor even as did the Pilgrim Fathers, preferring liberty to persecution for conscience’s sake. They are given no choice, but are driven forth relentlessly from a land in which they have been settled for hundreds of years.” According to the
New York Times
article about the appeal, Jews, “always charitable to a degree, and famous for the care of the poor of their race, the Hebrews, now find themselves confronted with a task that is beyond them to carry out unaided.”
As their wealth grew, the Goldman Sachs partners soon joined the “ghetto” of well-to-do Jewish bankers that had begun flocking to the NewJersey coastal towns of Elberon, Long Branch, Deal, and Sea Bright about ninety miles south of New York City. At a time well before the Hamptons became the place for rich Wall Streeters to preen, the Jewish bankers were simply mirroring, in their way, the exclusive weekend retreats that the WASP bankers had established in Newport, Rhode Island. Indeed, Elberon and its environs became known as the “Jewish Newport.” Newport was akin to Fifth Avenue, according toStephen Birmingham, and Elberon was akin to Central Park West, a distinction without much substance except for the obvious implications of the exclusionary aspects of each community.Peggy Guggenheim called Elberon “the ugliest place in the world. Not one tree or bush grew on the barren coast.”
Samuel Sachs’s house in Elberon was a grand adaptation of an Italianate palazzo “of white stucco, with a red-tiled roof and fountains and formal gardens,” and according to Birmingham “adopted from Versailles.” The Loebs, Schiffs, and Seligmans had homes in and around Elberon. “Certainly at some point during these great Elberon years,” Birmingham observed, “New York’s German Jewish financiers and their families had begun to think of themselves as an American aristocracy of a certain sort. With their moral tone and their emphasis
In 1894,Harry Sachs, Sam’s brother, joined the firm and the five partners, ten clerks, and a handful of messengers settled into second-floor offices at 43 Exchange Place. At that time, Goldman Sachs had $585,000 in capital and an annual profit of $200,000, areturn on equity of an astounding 34.2 percent and an early indicator of how profitable the business could be when managed properly. In 1896, Goldman Sachs joined theNew York Stock Exchange. By 1898, the firm’s capital stood at $1.6 million and was growing rapidly.
At that time, the firm also decided to open a foreign exchange department and by June 1899 had sent $1 million worth ofgold coins to Europe. Some dealers thought the firm had mispriced the shipment and lost $500, but Marcus Goldman said that it was “a regular and profitable operation” and done because gold coins “were cheaper” than bills of exchange. During the next few years, Goldman Sachs—along with Lazard Frères & Co., another small banking partnership with a Wall Street business—were among the largest in the business of importing and exporting gold bullion. It wasn’t all business at Goldman Sachs either: Goldman’s employees—with last names like Gregory, Hanna, Odz, Keiser, and Morrissey—were also regular tenpin bowlers in theBank Clerks’ League.
Marcus Goldman was also developing a reputation as a small-scale philanthropist, especially for causes involving the “Hebrews,” as Jewish immigrants to the United States were then known. In 1891, Goldman was part of leading an appeal—apparently the first of its kind—for general succor, “irrespective of creed or religion” of the donors, to JewishRussian immigrants to New York City who had arrived in the United States “well nigh penniless.” Some 7,500 Russians were then coming to Ellis Island monthly, “not willingly, nor even as did the Pilgrim Fathers, preferring liberty to persecution for conscience’s sake. They are given no choice, but are driven forth relentlessly from a land in which they have been settled for hundreds of years.” According to the
New York Times
article about the appeal, Jews, “always charitable to a degree, and famous for the care of the poor of their race, the Hebrews, now find themselves confronted with a task that is beyond them to carry out unaided.”
As their wealth grew, the Goldman Sachs partners soon joined the “ghetto” of well-to-do Jewish bankers that had begun flocking to the NewJersey coastal towns of Elberon, Long Branch, Deal, and Sea Bright about ninety miles south of New York City. At a time well before the Hamptons became the place for rich Wall Streeters to preen, the Jewish bankers were simply mirroring, in their way, the exclusive weekend retreats that the WASP bankers had established in Newport, Rhode Island. Indeed, Elberon and its environs became known as the “Jewish Newport.” Newport was akin to Fifth Avenue, according toStephen Birmingham, and Elberon was akin to Central Park West, a distinction without much substance except for the obvious implications of the exclusionary aspects of each community.Peggy Guggenheim called Elberon “the ugliest place in the world. Not one tree or bush grew on the barren coast.”
Samuel Sachs’s house in Elberon was a grand adaptation of an Italianate palazzo “of white stucco, with a red-tiled roof and fountains and formal gardens,” and according to Birmingham “adopted from Versailles.” The Loebs, Schiffs, and Seligmans had homes in and around Elberon. “Certainly at some point during these great Elberon years,” Birmingham observed, “New York’s German Jewish financiers and their families had begun to think of themselves as an American aristocracy of a certain sort. With their moral tone and their emphasis
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