The Story of the Rothschilds, the Richest Family in the World
In 1798, a successful German-Jewish banker decides to educate his five children in finance and sends them to different countries in Europe to expand his business. Today, 260 years after the start of this dynasty, this family has managed to position itself as one of the most powerful and influential in all of history, intervening in events as important as the independence of a Latin American country, saving the United States from various financial crises and avoiding a complete conquest of the old continent; facts that have led the collective imagination to label them as: “The owners of the world” … How did they do it?
How Did The Rothschilds Become The Richest Family In History?
The protagonists of this story are the Rothschilds, a family of Judeo-German origin commonly distinguished as the “House of Rothschild . “
The history of this lineage dates back to the 18th century, when in 1743 Mr. Amschel Moses Bauer, a goldsmith by profession, decided to open a money exchange and loan shop in the Jewish ghetto of Frankfurt, Germany. This business was very common in his town, since the Jews, who had been persecuted for more than 500 years, ended up settling mostly in Eastern European countries, and, due to their great pilgrimage and their few resources to acquire land, they developed the system of loans with interest, with which they were able to generate solid income to organize and prosper.
Amschel acquired a two-story house in Frankfurt. On the first floor, he established his business and left the second floor for the use of his family. On the front door, he hung a sign depicting a Roman eagle on a red shield. Over time, the place began to be recognized as “the store with the red shield”, that is, the “Rothschild” store, since in German the word “red” is “rot” and the word “shield” is “Schild”. . In the future, the family would begin to use the patronymic surname Rothschild.
The rise of the surname among European society would be achieved by Mr. Bauer’s son, Mayer Amschel Rothschild, who is considered the founder of the dynasty. Mayer, like his father, also engaged in financial activity in his native Frankfurt, conducting business, loans, and exchanges with coins and bills.
In 1769, he achieved the title of “Hoffaktor” from Elector William of Hesse, which made him a representative of the court.
The “5 Arrows” of the Rothschild dynasty
In 1784, he and his wife Gutle and their ten children moved to a large house, located in the “Callejón de los Jews”. His five sons, Amschel, Solomon, Nathan, Carl, and Jacob, are today represented on the family crest as the 5 arrows of the dynasty.
In this house, which began to be distinguished as “The House of the Red Shield”, Mayer educated his five sons and taught them everything related to his business and the plans he had for the future. Their idea was for them to become influential bankers to monarchs and governments, and later into the powerful “Rothschild bank”, with influence throughout central Europe.
“Give me control of a nation’s money supply and I won’t care who makes its laws.” Said Mayer once, making clear his vision to expand its banking empire around the world.
The first to join the financial business was the third of his sons, Nathan Mayer Rothschild, who, in 1798 and at the age of 22, emigrated to England. There he lived first in Manchester, where he worked as a textile merchant, distinguished by his aggressive sales style and his merchandise at competitive prices. Later, in 1809, he would move to London, where he would develop his banking activity, dedicated to the negotiation of bills of exchange and the organization of foreign loans.
With Nathan, the “English bank” of the family would be established. The greatest financial achievements on English soil would be the commission made to the five brothers, in 1814, for the collection of funds for Great Britain and her allies in the war to defeat Emperor Napoleon; and the £ 5 million loan to the Prussian government, made in 1818.
For his first feat in 1814, Nathan used money that his father cared for a renowned monarch of the time, who feared that Napoleon would come to his lands to conquer them. Thus, the young man, to stop a war that put everything at risk, participated in the contest as one of the main funders of the English crown. The amount of money and resources he lent is estimated to be equivalent to about $ 900 million today. Thanks to this money, the Duke of Wellington was able to send resources to his troops throughout Europe.
Rothschild’scontribution was crucial to the defeat of the fearsome Napoleon.
However, this was not the only play he made. At one point, when British troops considered the war lost, he took advantage of the fact that he had secret information that predicted the fall of Napoleon, so he used this advantage to increase his capital. The first thing he did was destabilize the financial market by selling all his bank shares, causing those with whom he influenced to imitate his behavior by believing that the war was already lost. England’s stock market crashed, and soon a group of Nathan’s associates began buying stocks at prices far below normal. This questionable strategy allowed him to consolidate his power in the country.
This intervention of the Rothschilds in the Napoleonic conflict is one of the facts that has stimulated so many conspiracy theories, in which it is said that this house finances wars to safeguard its economic interests or that they are the true architects of any large-scale confrontation, such as a kind of force that pulls the strings out of the dark. However, these theories have not been officially proven.
Nathan’s success as a banker would provide a model for his brothers in Frankfurt.
In 1812, Jacob Rothschild, the youngest of the family, would establish the banking house in Paris. In 1820, Solomon Rothschild would establish the “Vienna bank”, taking advantage of the fact that the family had long been active in the imperial finances of Austria. Eventually, the Austrian royalty would grant the title of “Baron” to the five brothers. And, as the Austrian Empire was strengthening its interests with Italy, Carl Rothschild moved to Naples to establish “Italian banking . ” Finally, Amschel, the eldest son of the family, was in charge of the “Frankfurt bank”, being the successor of his father.
Between 1821 and 1822, Brazil was in a great war in search of its independence from the Portuguese, but again Nathan Mayer interceded changing the course of history. After several conflicts, the Portuguese agreed to negotiate through Rothschild. They agreed that Brazil could be independent if they were paid for that right. The Portuguese were asking for £ 2 million, and Nathan was the one who made the loan to the new nation for its independence, which would open the doors to the Rothschilds.in Latin America. A sample of the great influence of the family in such transcendent political matters.
In addition to this, Carl Rothschild, who ran the family’s Italian banking, used to maintain strong ties with the church and the Vatican, making significant loans to them. His influence and power were such that, in 1832, when Carl met Pope Gregory Sixteenth, he was not required to kiss his feet, a situation that not even the kings themselves could avoid.
In 1836, the brightest of the five children, Nathan Mayer, passed away. By then, the Rothschilds were already the most successful bankers in the world.
The Rothschild Family’s Expansion of Wealth and Power
Over time, the brothers and their descendants added new interests to the Rothschild house, apart from their banking monopoly. In the middle of the 19th century, the family was not alien to the emergence of new powerful industries as a result of the industrialization of Europe, such as the railway, metallurgical, and mining industries. In France and Austria, they lobbied for the construction of rail networks. In Vienna, Solomon became interested in engineering and foundries. In Spain, the family succeeded in acquiring key mines to obtain the monopoly of the exploitation of mercury, and most of the family’s factions became involved with precious metals, especially gold, which was the one with which almost all the currencies of the world were backed, so having large reserves of the metal allowed them to increase their power and keep expanding.
In 1840, NM Rothschild & Sons, the parent company, became one of the Bank of England gold bullion brokers, as well as taking an interest in the creation of organizations in California and Australia during the “gold rush.” A time when many workers rushed to migrate to areas where large deposits of gold metal were discovered.
In the mid 19th century, the family began the construction of many of their iconic possessions, which housed all kinds of luxury objects and art collections, which is why they were also quite recognized. Some of these buildings are the Mentmore Towers, in England, and the Castle of Ferrières, in France.
In addition, Nathaniel de Rothschild in 1853 acquired the Château Brane-Mouton vineyard in France and turned it into one of the best and most recognized wine brands: Château Mouton Rothschild. In later years, the business was so profitable that it allowed the family to obtain several neighboring vineyards and to strongly position their brand in the market.
In 1861, as a result of the national unification of Italy led by King Victor Manuel II, the family’s bank of Naples was closed. However, the bond issuance business grew and consolidated as one of the pillars of the financial activity of the house.
With the death of Baron Jacob Rothschild in 1868, the generation of the five brothers had come to an end and gave way to the new generation of leaders of the House of the Red Shield.
The family ties of the new lineages of each country remained firm over the years; this largely to a questionable family tradition established by Mayer Amschel Rothschild, who copied from the families of monarchs of his time the fact that women were always paired with their cousins and men would inherit all the fortune and power of their parents.
Later, the French Rothschilds became interested in the exploitation of nickel and copper; and the English Rothschilds backed the venture known as “The Exploration Company”, dedicated to the exploration around the world of mineral sources. On the other hand, the family ventured into the mining of precious stones in Africa and India, in addition to getting involved in the oil sector together with the Nobel, the family from which the inventor of the prize comes with his last name, Alfred Nobel. This Swedish family was at the forefront of oil field development in Baku and Batum, in Russia, something that was very beneficial to the Rothschilds.
Among the new generations, there were also a large number of prominent members of the family …
Edmond de Rothschild, younger son of Baron Jacob and born in 1845, was a prominent figure for being an active defender of Zionism, a political ideology that supported the establishment of a state for the “Jewish people”, preferably in the ancient land of Israel. Edmond made several trips to Ottoman Palestine to oversee his funding of Jewish settlements in the territory. Thanks to the influence of his surname and his contributions, he is considered an important character to understand the conformation of the State of Israel.
In England, Walter Rothschild, son of the first lord that the family had, was a great fan of science, especially Zoology, for this reason, he created one of the largest collections of specimens in the world, something that until then had not many precedents. In addition, during his life, he was strongly dedicated to politics. One of his most important steps was to allow the British government to acquire important participation in the creation of the Suez Canal.
In France, his cousin Henri Rothschild was another illustrious person, being an expert in child nutrition.
In 1895, the United States was going through a difficult economic recession. The government was running out of gold and the sources of income to pay the debts were insufficient. In a few years, the country was going to collapse. It was then that President Grover Cleveland, approached the Rothschilds, who worked in conjunction with JP Morgan and loaned the United States the money to pay off its debts, thus avoiding a default of payments and protecting the national treasury.
In 1901, the part of the family established in Frankfurt is left without a male heir, which means that, after more than a century, the Rothschilds cut ties with their hometown. They would not operate again in Frankfurt until 1989.
The Rothschilds and the two world wars
With the arrival of the 20th century and the outlook of two world wars, the family had to face various setbacks and great changes.
On the one hand, after the First World War, business banks lost the place that allowed them to generate financing for governments, handing it over to new international financing institutions. The Rothschild banks began a transition toward financing commercial and industrial companies; including the London Underground.
Another curious fact is that, during the signing of the Treaty of Versailles in 1919, which would end the First World War, several members of the family were found, which further fuels the theory that the Rothschilds have always been behind the wars, starting and ending them at will.
In 1919, taking advantage of their large investments in gold, the family managed to obtain the role of permanent banking for the regulation of the price of gold in the world, for which they met daily to stipulate the value of the said metal in the market.
In Austria, Louis Nathaniel de Rothschild made an admirable effort to achieve save the banking Creditanstalt, Austria’s largest bank, after the devastating effects of the 1929 crash, the precipitous fall of the stock exchanges in the United States.
During World War II, the family was also affected. As the Rothschilds were a Jewish family when Nazi Germany invaded Austria and France they were forced to flee and dissolve the banks of both countries. In addition, once the war ended, a good part of its assets, famous mansions, and collections was seized and became public domain.
The recovery time in the postwar period was slow and the family had to adapt to the new circumstances of the world.
The Rothschild Family and its influence on the world economy
In 1960, the French and English banks decided to strengthen their operations in the United States, the new great world power. There, Rothschild Inc would be born. Since then, it is speculated that the family may have had a lot to do with the creation of the Federal Reserve of the Enidos States in 1913, which, with the Bretton Woods treaty in 1944, promised to back all printed and circulating dollars with large gold reserves, priced at $ 35 per ounce; However, eventually French President Charles de GaulleRealizing the privilege that the United States obtained for being the issuing country of the currency used as a reserve in the international financial system, it decided between 1965 and 1968 to return more than $5 billion to obtain its equivalent in gold. Other countries, such as Germany and Japan, followed suit, causing President Nixon to unilaterally end the Bretton Woods treaty in 1971.
On the other hand, in London, the old multinational NM Rothschild & Sons had an anticipated role in the new Eurobond markets.
In 1963, Edmond James de Rothschild created the Compagnie Financière Edmond de Rothschild, based in Switzerland. This venture capital company would soon become an investment bank and an asset management corporation.
In 1972, the Rothschilds threw one of their recurring private parties. Until then, very few people knew about these parties, but on that occasion, some photos of the event were leaked. In them, you could see the assistants disguised with bizarre masks of all kinds. Invitation cards for these holidays used to come with letters backward. The facade of the place where the celebration took place was always illuminated with red lights. Those who received the invitation had to wear a mask to hide their identity. All this looked like a kind of cult, which aroused great rumors in public opinion.
In the 1980s, the Rothschilds would be part of the privatization phenomenon, a period in which the high cost and low efficiency of many public entities led them to tender. The family participated from the beginning in more than thirty countries. This global trend corresponded with the resurgence of family businesses, reaching around 2,800 employees in more than 40 countries.
The richest and most powerful family in history: The Rothschilds
Currently, there are a large number of heirs around the world who bear the surname and who carry out some outstanding business activity. Its banks have been merging with others in different countries, so it is believed that they could still have the power of a large part of world banking.
Two of the last prominent members of the dynasty are Benjamin Rothschild, the French banker who died of a heart attack on January 15, 2021, at the age of 57, who had a personal fortune of more than $ 1.1 billion; and Jacob Rothschild, an 85-year-old English banker and investor with an estimated personal fortune of $ 1.5 billion. Both have been the only ones in the family to occupy a position among the richest people in the world according to Forbes magazine. Incredibly, despite the power of the surname, the other members never came to occupy these places because the fortune has been diluted over the years and a large number of heirs. In addition, the family has always kept their privacy aside, which prevents an exact calculation of the fortune of each of its members.
As a curious fact, it is thought that, if all the wealth and assets of the family were concentrated in a single person, he should have a fortune of approximately $350 billion, which would be higher than the fortune of the richest man in the world of today, which is Elon Musk(CEO of SpaceX and Tesla ), with a net worth of $ 280 billion; and from another of the richest families in the world, the Waltons (owners of Walmart ) with $238 billion. However, a higher and more accurate estimate results in the family’s fortune at the end of the 19th century was around a trillion dollars ( $ 100,000,000,000,000 ), an amount of money greater than the fortune amassed by John Davison Rockefeller in life, which was about $800 billion; which makes the Rothschilds the richest family of all time.
Thus we conclude the fascinating story of the Rothschilds, a family that undoubtedly marked the course of modern history thanks to their determining power and influence when talking about the financial and business development of the Old and New Continents. Without them, possibly Napoleon would have conquered Europe, Brazil would have taken longer to become independent, the United States could be a third-world country and the old continent would have taken longer to recover after the two world wars. For better or for worse, this family has influenced the construction of the world we know today, all thanks to the vision and determination of its founder, Mayer Amschel Rothschild., and their 5 “arrows”, who were clear that they had to dominate the economy to rule the world; something that was immortalized in manifest in the words of Nathan Mayer Rothschild :
“I don’t care which puppet is sitting on the throne of England, to rule the empire where the sun never sets. The man who controls England’s source of money, controls the British Empire… and I control England’s source of money. “