Money mavens love our nation's founding fathers.
Many, such as J.D. Roth over at Get Rich Slowly, are particularly fond of Benjamin Franklin. He was pithy, to the point, and always quotable. But as Kiplinger's Tina Korbe writes, many of our most revered 18th century icons have offered advice about handling personal finances that still holds up more than two centuries later.
There is one financial founding father we don't hear as much about. William Duer, a delegate to the Continental Congress and an assistant to the nation's first treasury secretary, Alexander Hamilton, became a financial speculator who ripped off investors so spectacularly in 1792 that Hamilton had to step in, like Tim Geithner today, to stop an economic panic. It was the most aggressive intervention of its kind until modern markets tanked in 1987.
Playing financially fast and loose happened a lot in 18th and 19th century America. George Washington, in addition to his many other accomplishments, was a legendary land speculator. Thomas Jefferson, Abraham Lincoln and fistfuls of less well known historical icons dabbled too.
Many of the schemes failed. Ironically, some of the suddenly worthless shares in those failed enterprises are worth hundreds or thousands of dollars as collectors items now because some of the same promoters also signed the Declaration of Independence and other bits of our historical DNA.
Duer died in debtor's prison in 1799, leaving a legacy that remains with us today. When traders and investors stung by the schemes met under a buttonwood tree near what now is 68 Wall Street to organize what became the New York Stock Exchange, they laid down ground rules to curb insider trading and other abuses specifically inspired by Duer's career. We're still following those rules, some days more successfully than others, Right, Mr. Madoff?
Happy Independence Day, everyone