Showing posts with label Brown Brothers. Show all posts
Showing posts with label Brown Brothers. Show all posts

Monday, September 30, 2013

Who was Alexander Brown?

A Protestant in Ireland, Alexander Brown had worked as an auctioneer in the linen market in Belfast, which after 1785 was conducted in an impressive building owned by the Earl of Donegall. The building's lease was bought by John Brown, founder of the Bank of the Four Johns in Belfast, but who does not appear to have been a close relation of Alexander. Although his auction business was profitable in Ballymena, after visiting a brother, Stewart Brown, in Baltimore, Alexander decided to settle in that city on the opposite side of the Atlantic. Another brother remained behind in London to work with him in an import-export business. By 1811 all four of his sons were partners with him in Alex. Brown & Sons, headquartered in Baltimore.

The British Browns

William Brown, his eldest son, returned to England in 1809 and set up a brokerage firm that would operate first as W. and J. Brown, renamed in 1839 as Brown, Shipley & Co., in Liverpool. William’s role in the business, among other duties, would be to find wealthy investors to buy the paper issued in America.

Finding such investors required that he create a network around himself of powerful society members with whom to socialize, possibly one of the reasons he first stood for Parliament in 1846. Twenty years later he was created a baronet, Sir William Brown of Beilby Grange (a mansion near Leeds) and Richmond Hill (near Lancaster). His descendants are set out in Burke's Peerage. (See also website, The Peerage).
Sir William Brown
It is a truism in banking families that they frequently marry not-too-distant cousins and relations of their father’s business associates, helping to keep the money—and the secrets—within the family. Researching genealogies is, therefore, a very useful tool in understanding confidential financial relationships.

When William returned to Britain in 1809, his younger brothers were still being educated by a country minister at Catterick in North Yorkshire. Initially, William went to Ireland to work at the market where Alexander had started his career. There he met and married the daughter of his father’s Belfast linen supplier, Andrew Gihon. Although they had eight children, only two lived to become adults, and none of those survived him.
  • Grace (1812-1849), in 1831 married John Hargreaves, whose family owned the calico print works at Accrington—midway between Leeds and Lancaster. Grace Hargreaves' son John continued with the calico business, while her son Thomas pursued a military career.
  • Alexander (1817-1849), married James Brown’s daughter, Sarah Benedict Brown, during a visit to America in 1838, thus uniting the English and American house of the brokerage company and the bank in which the brothers were all partners. Their children were as follows: William Richmond Brown (1840-1906); James Clifton Brown (1841-66); Louisa (1842-63), who married Capt. Alexander William Cobham; Alexander Hargreaves Brown (1844-76).
William's grandson, Alexander Hargreaves Brown, became a Member of Parliament in 1863 and served until 1902, while during that time becoming a partner of the Brown Brothers bank in 1875, later serving as senior partner in the London office on Pall Mall.
These two branches of Sir William's descendants continued to marry their children to their cousins and thus perpetuate the financial connections on both sides of the ocean.
James Brown was the only one of Alexander Brown's sons who married a native American girl. In December 1817 he married Louisa Kirkland Benedict, youngest daughter of Dr. Joel Benedict, and his wife Sarah McKown Benedict. Her father has sometimes been confused with Dr. Benedict's nephew and namesake, Rev. Joel Tyler Benedict, a Presbyterian minister who was working at a branch of the American Tract Society in Philadelphia when James arrived in that city, having been tasked by his father to  assist his brother, John A. Brown, in starting a branch of Alex. Brown & Sons there, and it is possible he met her through this relationship since the Brown family had long been Presbyterian rather than Episcopalian.

James Brown of New York

Eliphalet Nott
Connections to church hierarchies

In 1817 James Brown, Alexander Brown's youngest son who had recently relocated from Baltimore to Philadelphia, married Louisa Kirkland Benedict, youngest daughter of Dr. Joel and Sarah McKown Benedict.

Her parents' eldest daughter, Sarah "Sally" Benedict, was already 21 years of age by the time Louisa was born in 1795.  Union College was founded that same year in Schenectady, New York, and Dr. Joel Benedict's student and new son-in-law, Rev. Eliphalet Nott, was named the president of the college.

The eminent Potter family

Although Sally Benedict Nott died the year her husband ascended to that position, she left behind a daughter, Sarah Maria Nott, with whom Louisa was quite close. Seven years after James Brown became part of the Benedict family, his wife's niece married Rev. Alonzo Potter, her father's foremost divinity student at Union College. He also became a professor at the college (1831-45), after which he was named Bishop of the Pennsylvania Diocese of the Protestant Episcopal Church.

Louisa Brown died in 1829 and her niece followed a decade later. James Brown waited two years before marrying Eliza Maria Coe, the orphaned daughter of another Presbyterian minister, Dr. Jonas Coe of Troy, New York. Alonzo Potter married, after the death of Sarah Maria Potter, the daughter of her brother Robert, who was also named Sarah Benedict, and with her had three more sons.

The daughter born to James Brown and Louisa Benedict in 1827 would grow up to marry Howard Potter, the second son of Louisa's favorite niece, Sarah Benedict Nott and her husband Bishop Alonzo Potter. After their marriage, Howard Potter became a partner in the Brown Brothers & Co. investment bank in New York, although he spent many years as manager of the London office. It will be recalled that James Brown's eldest daughter, Sarah Benedict Brown, had married her first cousin Alexander, whose father was Sir William Brown of the Liverpool and London offices. Two of their siblings--Grace and William--were lost aboard ship in 1854 as young adults. The youngest sibling, Margaretta Hunter Brown, married James Couper Lord, a son of the firm's attorney, Daniel Lord and his wife Susan DeForest. The Lord family, as has been mentioned previously at this blog, is one of the most significant families involved in the Skull and Bones secret society.

It has also been mentioned at this author's blog, Quixotic Joust, that the DeForest family were connected to some high-level members of the Episcopal Church, such as Dr. Horatio Potter, who became acquainted with Frank G. Wisner shortly before he was chosen to become head of a select arm of intelligence in the United States. We will soon discuss how all these connections interlink with the Brown Brothers investments.

Wednesday, August 28, 2013


In 2006 the author was asked to deliver a presentation for a Sanders Research Associates conference, that was later cancelled. The ideas that arose from that endeavor have been expanded. What appears below is the first segment, which will be continued later.

Micro Versus Macro View of the World

During my brief talk, I want give an overview of my own concept of the historical development of transnational globalism by use of a metaphor that effectively depicts the growth and evolution over the last five centuries of similar patterns that have occurred among various nations and the economic models they use to sustain that nation's economy.

Then I want to go into a little more detail into one family I have studied which has had a very significant role in behind-the-scenes transnational finance. The family we’ll be looking at, like most merchant bankers, started out as just merchants. Whether we use other terms, like “private” bankers, “investment” bankers, or simply “venture capitalists,” they are essentially small groups of very discreet people—often family members—who have access to vast pools of wealth, which they promise to invest at great rates of return. Their costumes may change from one generation to the next, but they are always at the scene, pulling strings (often hidden behind the curtain) to make history unfold as it does.

Patterns Beginning in Early 16th Century

The earliest examples we find of global trade, such as the exploits of Marco Polo, were family enterprises. Even Christopher Columbus, after his initial discovery of the “new world,” made four or five subsequent voyages with his brothers and son. Shipbuilding was a family business, and therefore the seamen who became traders operated in family units as they set out in search of the unknown.  Over time they established trading networks in various ports throughout the world, attempting to make a profit each time they unloaded their ships in a different location. The danger was great, but the promise of large returns on a successful voyage made the risk worthwhile.

It didn’t take the seasoned travelers long to realize, however, that competition brought profits down, and that it could be eliminated by acquiring a monopoly from their local prince, or a concession from a foreign one—to have the sole right to engage in that particular enterprise in that precise location. However, such a trading right would be worthless unless it could be protected by force. The development of nation states occurred as local fiefdoms expanded, garnering increased power to secure these commercial rights. Political boundaries went as far as the lord of that domain could protect the people within.

Organic Metaphor

I tend to think in organic, rather than mechanical, terms. Visualize if you can a series of oceans surrounding masses of land. Each mass of land with a separate economic system is depicted as if it were a self-sustaining plant growing in an earthen pot. There is a root system, a cluster of leaves and a stem.   

Spider Plant as metaphor
Over the centuries, as the plant increases in size, it becomes root-bound. The roots consist of members of the economic society who cultivate the soil in some fashion--like miners or farmers--who have become unable to provide enough resources from the restrictive boundaries of this pot to furnish nutrients for the plant’s leaves in order to produce a surplus above bare subsistence that would allow the plant to produce flowers or seeds to ensure physical survival. 

It was that lack of resources, as well as the bland existence of life that motivated explorers to escape the walls of the fief during the dark ages. And it was what they brought back from their adventures that resulted in further change.

Thus the Renaissance was like a genetic mutation of the medieval plant. Think of the stem of that plant as being the lord of the manor whose responsibility was to ensure the most efficient production of all units within the plant by properly coordinating distribution of raw resources and finished consumer goods. He served as the clearinghouse or marketplace where all such products were exchanged. He could maintain power only so long as he was able to satisfy the needs of these units. The lord recognized his power was draining away when there was no longer enough soil in the pot to feed all the leaves. He either had to enlarge the pot (something that would require a war), or he had to find another way of getting the necessary nutrients. The solution he found was to change the plant’s structure.  
Since this is my metaphor, I allowed my lord of the pot to create the spider plant; lords of the various pots equate to the crowned heads of seventeenth-century Europe, whose lawyers devised the concept of the chartered company. These crowned heads were, by this time, desperate for new resources, having found that wars to increase the size of their pots had further depleted their resources. As new lands were claimed on behalf of each root-bound pot by explorers  authorized to trade outside the pot, the lord found he or she had magically acquired the means to pay these explorers as bankers suddenly popped up, generously offering to turn that new land into ready cash (specie) for the pot.

 “Give us a portion of that new land as a grant,” they said, “and we will do your work for you, as long as we have a monopoly on the trade.”  

Like stems of a spider plant, each pot on the original map began sending out new shoots, each with its own cluster of roots and leaves ready to plant itself in new soil and recreate itself. When this shoot (like a colony) settles on soil, its roots can develop to feed its leaves while still being connected to the original stem by the stolon, which allows it to send the required percentage of absorbed minerals back to the parent plant, whether assessed against the company or the settlers brought there by the company.  

In return, the lord is able to promise protection to the colony should a threat occur. Thus a reciprocal relationship was developed between trading families who invested in such charter companies and the heads of state. That relationship persists to this day even though the legal framework has evolved from chartered companies into multinational corporations.

Unfortunately, a metaphor is not the truth. It is a visual and an intellectual aid to assist in understanding the truth. It must be tested for accuracy. The plant metaphor acts as the macro illustration of the world. What follows is the micro test. Here we focus on one example--one family network arrived in America only a decade or so after the Constitution was adopted. We will examine that family to learn how its banking business became intertwined with governments in America and abroad, in so doing testing whether the metaphor we have presented gives a true and accurate picture of the world.

With reference to modern financial institutions, what is now called Deutsche Bank Alex. Brown, Inc. is the result of a series of investment bank buyouts culminating in 1999 when the German bank acquired all assets of the old  investment bank established in Baltimore, Maryland, by Alexander Brown who first arrived in America in 1800 to engage in the linen trade. 

White Linen Hall in Belfast, Ireland
Brown’s parents were William and Margaret Davison Brown, who were living in Ballymena, Ireland, when Alexander was born in 1764. Scots like the Browns had begun to settle in this section of Ireland at the height of Parliament's legal dueling with Charles I in 1641.

Fifty years later, upon accession of William and Mary and creation of the Bank of England, the Protestant population began to explode in Catholic Ireland restrictions on the woollen trade, coupled with legislation allowing linen to be shipped duty-free to England and to British colonies in America, increased the importance of the linen industry in Northern Ireland.

Most of the immigrating Scottish families stemmed from Huguenots who had fled France during the latter part of the 16th century rather than convert to Catholicism. For more than a century the flax and linen industry would be Northern Ireland’s main source of wealth as trading networks were established by immigrating families.

Thursday, April 18, 2013

For Whom Does "the CIA" Really Work?

With this post we continue to explore connections mentioned by JFK assassination researcher Lisa Pease, author of "David Atlee Phillips, Clay Shaw and Freeport Sulphur," who focused on the sulphur company during times it was headed by John Hay "Jock" Whitney. Originally published in Probe, Pease's article discusses Freeport Sulphur's international nature as well as its close ties to happenings in Cuba during the time JFK was President. 

Valuable in the insight Pease's article gives us into the role of the Central Intelligence Agency's use of Freeport Sulphur, nevertheless it does not ask who really owns and operates the CIA itself. Perhaps looking back deeper into the company and its formative years will help in answering that question.

Who Was Jock Whitney?

Jock's father was William Payne Whitney, commonly known simply as Payne. As a youngster, Payne Whitney was caught in a feud between his father and his mother's brother, Oliver Payne, following her death in 1893. Promised a share of Oliver's wealth, he turned against his own father, who had married Edith Randolph, a woman scorned by the Payne family, whom he had been seeing before his wife died. According to the New York Social Diary website:
Jock and Betsy Cushing Whitney
In 1902 [William Collins] Whitney’s son, Payne Whitney, who’d sided with Oliver Payne, married Helen Hay from Cleveland, Ohio. Miss Hay was the daughter of John Hay who had been private secretary to President Lincoln and later Ambassador to the Court of St. James under President McKinley. Mr. Whitney who, like his father, went to Yale, was 26. For a wedding gift, Col. Payne gave the couple a Stanford White house at 972 Fifth Avenue.... After the Second World War, he started an investment fund, run by a friend he’d met in the War, to invest in new ideas of the men coming back from the War. He called it Adventure Capital and later dropped the “ad” to coin the now established term: venture capital. He was known for his ventures in Hollywood (“Gone With the Wind”), his industrious ventures, as well as being the last publisher of The New York Herald-Tribune.... Like his grandfather, he was also the Ambassador to the Court of St. James (under Eisenhower). Married twice, first to a beauty who loved horses more, and finally to Betsey Cushing Roosevelt, daughter of the famous brain surgeon Harvey Cushing, first wife of FDR’s son’s James, to whom he [Jock] remained married to the end of his life.... The Payne fortune, inherited by Payne Whitney, and then his children, grew far larger than the fortune left by William C. Whitney to his children. That was partly due to the fact that Harry Payne Whitney and Gertrude Vanderbilt produced more offspring who produced more offspring. Jock Whitney produced no off-spring, and his investments after the War catapulted him (and partially his sister [Joan Whitney Payson]) into the realm of what are now billions.
972 Fifth Avenue mansion
Payne Whitney had inherited his uncle's huge mansion in New York, and the 1920 census shows Jock and Joan living there with their parents--only four people at 972 Fifth Avenue--being cared for by fifteen servants, none of whom were American-born. Payne's business address, 14 Wall Street, was the Bankers Trust Company, set up by the White and Case law firm in 1903, and was controlled by J.P. Morgan affiliates in the days prior to the creation of the Federal Reserve banking system. Before 1930 Morgan bankers controlled United States government policy on currency. According to economist Murray Rothbard, the first governor of the New York Federal Reserve Bank was:
Benjamin Strong, who had spent virtually his entire business and personal life in the circle of top associates of J.P. Morgan. A secretary of several trust companies (banks doing trust business) in New York City, Strong became neighbor and close friend of three top Morgan partners, Henry P. Davison, Dwight Morrow, and Thomas W. Lamont. Davison, in particular, became his mentor, and brought him into Morgan's Bankers Trust company, where he soon succeeded Lamont as vice-president, and then finally became president. When Strong was offered the post of Governor of the New York Fed, it was Davison who persuaded him to take the job....The main collaboration throughout the 1920s, much of it kept secret from the Federal Reserve Board in Washington, was between Strong and the man who soon became Governor of the Bank of England, Montagu Collet Norman. Norman and Strong were not only fast friends, but had important investment-banking ties, Norman's uncle having been a partner of the great English banking firm of Baring Brothers, and his grandfather a partner in the international banking house of Brown Shipley and Co., the London branch of the Wall Street banking firm of Brown Brothers. Before coming to the Bank of England, Norman himself had worked at the Wall Street office of Brown Brothers, and then returned to London to become a partner of Brown Shipley.

The Role of Brown Brothers Harriman

Montagu Norman had been called "the currency dictator of Europe" by the Wall Street Journal in 1927. Thus, when the U.S. government witnessed the decline of the Brown Brothers investment bank in 1926, it felt the need to shore it up with an infusion of capital and turned to the two Yale educated sons of robber baron E.H. Harriman to do so. Averell and Roland (Bunny) Harrison were the Skull and Bones friends and eventual partners of Prescott Sheldon Bush, the father and grandfather of two future presidents.

It is no coincidence that America's earliest attempts at setting up intelligence agencies called upon the talents of the sons of Wall Street bankers. Idealistic principles often fall by the wayside when big money is involved, and it is the wealthy elitists who think they have the most to lose in the games played in international market manipulations. The poor have only their lives, and are often treated as cannon fodder by such elitists on every front.

In the years between the two "great" wars the Brown Brothers partner, Montagu Norman, was actively concerned with handling Germany's reparations payments, working with the first head of the Bank for International Settlements, Gates McGarrah, whose grandson, Richard McGarrah Helms, would later head the Central Intelligence Agency. 

Within six months after the above photos appeared in the news, Norman had found the perfect rich kids to entice with the power of helping to run the world. Their father's death in September 1909, when the boys were mere teenagers, had been the top headline in newspapers throughout America. Their mentor became the man most trusted by their father to run his business, Robert Scott Lovett, who would see that the boys were educated at Yale alongside his own son, Robert Abercrombie Lovett. All would rise to power in the government as the second great war approached, with help from their brothers in Skull and Bones.

Prescott Bush, center, with Brown Brothers Harriman partners--Bunny Harriman, Knight Woolley, and R.A. Lovett

By following the money, you often learn how the world really operates, who works for whom, so to speak.

Oliver Stone relates in his book, The Untold History of the United States:
Prominent among the American capitalists with ties to Nazi counterparts was Prescott Bush, the father of one president and grandfather of another. Researchers have been trying for years to determine the precise nature of Bush's ties to Fritz Thyssen, the wealthy German industrialist who played a crucial role in bankrolling Hitler, as revealed in his 1941 memoirs I Paid Hitler. Thyssen ultimately repudiated the Nazi dictator and was himself imprisoned.
While incarcerated, Thyssen's vast wealth was protected overseas, much of it by the investment firm of Brown Brothers Harriman, through the holding company Union Banking Corporation. The account was managed by senior partner Prescott Bush. 

About ten years younger than the Harriman boys, Jock Whitney and his sister sat atop a huge pile of money which they would make available to those in power engaged in manipulation of international currency. Although Jock went to Yale, he was tapped for Scroll and Key, rather than the Bones secret society, and was a mere two years behind Scroll and Key member James Stillman Rockefeller (son of Elsie Stillman and William G. Rockefeller), whose Uncle Percy, married in 1901 to Elsie's sister Isabel Stillman, was a member of the Skull and Bones class of 1900. Only a year after his Yale graduation, James Stillman Rockefeller had united fortunes with the Carnegies by marrying the niece of the steel magnate whose fortune had been liquidated by the Morgan bank. Five years later, Chase Manhattan bank would acquire the Equitable Trust, another Morgan affiliate--thus shifting control of the New York Fed in 1930 from Morgan to Rockefeller-owned banks at the same time Freeport Sulphur's control shifted under the leadership of Langbourne Williams, Jr., a Stillman son-in-law, as will be detailed in the next installment.