Georgian London: Into the Streets

by Lucy Inglis

  London’s early Jewish community was made up mainly of Sephardic Jews of Levantine descent, in small family units, often specializing in the trade of exotic goods. The Ashkenazi Jews of Germany and eastern Europe, who came later, comprised swathes of people from the very rich to the very poor, with larger families and a broader selection of vocations. In 1692, the Ashkenazim were present in large enough numbers to open a synagogue of their own in Duke’s Place, near Aldgate. They termed themselves ‘the German Jews’ and saw themselves as distinct from ‘the Portuguese Congregation’ of the Sephardic Jews.

  King William III had been ably assisted in matters of war and finance by Solomon de Medina who, in 1700, was the first Jew to be knighted in England. When, in 1698, Rabbi David Nieto formed a committee to raise money for a new synagogue, de Medina was the largest contributor by a healthy margin. Some land in Plough Yard was purchased on a lease of sixty-one years for the Bevis Marks Synagogue. (Bevis Marks may sound like a person but it was the street Plough Yard opened on to, and was only a short distance from the Duke’s Place synagogue.)

  On 12 February 1699, the committee signed an agreement with Joseph Avis, Quaker and builder, for the building of a synagogue on Bevis Marks at a cost of no more than £2,750, which is the equivalent of four and a quarter million pounds now. The Quakers were the largest Nonconforming religious denomination in the same area, traditionally living around Lombard Street. Queen Anne showed her approval of the collaboration by donating a roof timber – a symbolic gesture, corresponding with the Jewish requirement to maintain a head covering in the sight of God. In 1702, the Bevis Marks synagogue was dedicated. Avis returned all monies left over from the works, stating that he would not profit from building a religious house.

  In 1723, a law was passed allowing Jews to hold title to land. This was a major step forward and led to the ‘official’ opening of a third synagogue, in Magpie Alley, Fenchurch Street, known as the Hambro synagogue. The Jewish Naturalization Act was passed in 1753, which meant that Jews could become naturalized English citizens after seven years in the country. It was dubbed ‘The Jew Bill’ and was repealed the following year due to massive street protests. Things calmed down, and London’s Jewish community carried on as before – commercially present, yet socially invisible.

  Despite being marginalized citizens, who clung tenaciously to ‘foreign’ lifestyles, the French and Jewish communities of the City are crucial to the history of the Bank of England. Just as English monarchs had traditionally turned to Jewish moneylenders before the Edict of Expulsion, William III turned to some of London’s richest men in the early 1690s. He was waging a war in the Low Countries and was desperately short of cash. The Bank of England was founded in 1694, to supply this need, and became such a part of the British identity that when the first commuter omnibus service started in 1829, running from Paddington to the City, its destination was given only as ‘The Bank’. These days, we have lost the definite article and the same destination, whether by bus or Tube, is known simply as ‘Bank’.

  During the late seventeenth century, banks were private and it was up to the customer to choose which man he trusted enough to deposit his money with. Child’s Bank, Hoare’s and Coutts & Co., are three of the earliest and most famous. Their founders – Francis Child, Sir Richard Hoare and John Campbell – were all goldsmiths and bankers, used to buying in and storing quantities of bullion to fashion their wares. Their promissory notes were known as Running Cashes and functioned like a banknote. These men were prominent and trusted, but it was thought that London needed an official bank, such as those in Amsterdam or Germany.

  A group of City merchants stepped up who believed they could raise a million pounds to start a new bank. A significant number of these men were Huguenots, including their leader, John Houblon, whose family had made their money in shipping. The million pounds would go to the state, and the newly created Bank of England was to reap £65,000 interest for its investors annually, and in perpetuity. Thus, in one swift Act of 1694, the National Debt was created.

  In the chapel of Mercers’ Hall in Poultry, a Book of Subscriptions was opened for ten days at the end of June, allowing the citizens of London to invest in the new bank. At the end of this short period, 1,267 people had subscribed and Houblon was elected first Governor.

  The Great Seal of the Bank bore the image of Britannia, with her spear and her leg boldly on show, which had appeared on the coins of Hadrian and Antoninus Pius in the second century AD. No more was heard of her until after the Restoration when, in 1667, Charles ordered a Britannia medallion to be struck to commemorate the Peace of Breda, which ended the Second Anglo-Dutch War. His own likeness, on the front, was captured from a drawing done by candlelight, by ‘Mr Cooper, the rare limner’, whilst John Evelyn held the candle. Charles decided that Britannia should feature on the reverse, and that the Duchess of Richmond should sit as the model. The reaction to the Duchess of Richmond was so positive that she began to appear on the halfpennies and farthings issued soon after. As Samuel Pepys recorded, her face is ‘as well done as ever I saw anything in my whole life, I think; and a pretty thing it is, that he should choose her face to represent Britannia by’.

  Two years later, during the Great Recoinage of 1696, Britannia came to symbolize the new standard of English money. Old, fake or clipped coins had become a huge problem. England had minted most of its coins in the Royal Mint near the Tower since around 1279, with the high-value denominations in gold and sterling-standard silver. These coins had a set value, but they stayed in circulation for a long time. Over the decades, the bullion prices changed, so the real value of the metal was either lower or higher than the face value of the coin. If the value was lower, it was cheaper to ‘buy’ coins and make them into silver dishes, spoons and forks than it was to buy the bullion to make them. So coins were removed from circulation. At the same time, the price of bullion on the Continent rose and clever merchants shipped English coin to Europe, where it was purchased and melted down. By the 1670s, John Evelyn recorded that there were not enough coins around to pay for simple household items and food. This provided the perfect opportunity for fakers. As long as no one looked too closely, and simply continued to pass the money around the system, it was worth the face value. Daniel Defoe always attempted to hand over any fake money first, but made sure he had the right amount of genuine money in his pocket in case he was caught. When nineteen-year-old Isaac Newton made lists of his ‘sins’, at Whitsuntide 1662, along with stealing, ‘punching my sister’, ‘falling out with the servants’ and ‘having unclean thoughts’ was ‘striving to cheat with a brass halfe crowne’. A less than promising start for the man who would become Warden of the Royal Mint. Passing off the fake coin was so widespread that the shopkeepers – who were supposed to destroy any fake coin that came their way – often passed it on, and a secondary trade in fake money sprang up alongside the bullion trade. The making of fake money was a skilled job: there were dies to carve, and striking coins from hard mixed metals was not easy.

  Those further down the currency chain often turned to coin clipping. The edges of Britain’s modern coins are milled to prevent this crafty exercise, but in the early Georgian period plenty of old, worn coins were swimming about in the system, their fine edges ripe for trimming and polishing back up. It was so prevalent that fakers even clipped their forgeries to make them appear more convincing. Coin clipping allowed poor but daring people to build up enough shavings to take to a smelter and have changed for money. The smelter had to be in on the act, but he was just another component of a complicated network, with one foot either side of the law. Coinage offences were taken very seriously by the courts: women caught clipping were supposed to be burned, and the men were hanged (although this wasn’t regularly enforced).

  With so many fakes and devalued coins around, it was no wonder William III decided, in 1696, to give English money a makeover through recoinage, effectively revaluing the pound. Anticipating the demands of recoinage upon available b
ullion reserves, the Bank of England decided it needed to appoint ‘a fit person who understands gold and silver’. That man was Moses Mocatta, a partner in the firm Mocatta and Goldsmid. Moses Mocatta and his family worshipped at the Bevis Marks Synagogue and had strong ties with the Amsterdam bullion community. He established a repository near the Bank, known only as ‘The Warehouse’, where vast quantities of gold and silver bullion were kept. The early bullion trade was supplemented by the issuing of promissory notes, which were an instant and somewhat alarming success. Because Bank of England notes were payable instantly upon presentation and because the Bank’s credit was so good, Bank of England notes became an easy target for forgers. In 1724, the Bank thought it had found a solution. The Huguenot Henry Portal made high-grade paper at Bere Mill in Hampshire. This paper, when watermarked, was very hard to fake. The Bank began printing large numbers of notes for fixed sums, whereas previously they had been filled out for the sum specified by the customer. In 1725, the first modern banknotes appeared. The Portals still make the paper for all English banknotes.

  The commissioning of the new banknotes came when the Bank was formalizing its structure. It became clear that the Bank needed both consolidating and securing; in the late 1780s, Sir John Soane was appointed as the architect of a new building in the Classical style. From then until 1833, the Bank was slowly transformed into an enormous strongroom.

  This transformation was both symbolic and real: the Bank had become a vast and wealthy institution, on its guard against theft and fraud. Clever forgers had caught up, and were making copies of the Portal banknotes. Many were caught, including Mary England. She and her husband, James, were arrested in January 1814 for circulating forged Bank of England notes. The penalty for forgery itself was death, but the Bank decided not to prosecute James for forgery. He promptly skipped out and boarded a ship. Mary was left, with her four children, facing prosecution for possessing forged notes. She was tried at the Old Bailey in February, and was sentenced to be transported for fourteen years. They were confined to Newgate Prison until the ship was full enough with other prisoners to sail.

  By April, she had pawned all the family’s clothes and, in desperation, she wrote to the Bank, asking to be excused for troubling them, but: ‘I have Been so Unfortunate as to be in Newgate on Account of the Bank Business’. The Bank sent her an allowance of 10s 6d per week until she was transported. She applied to the Bank again, from on board the convict ship Northampton sitting at Deptford, asking for a lump sum for her family’s new life. Her letters are annotated by a bank employee: ‘Mr Kaye to pay her ten pounds.’ Mary signed for the money on board ship four days later, and the Northampton left England soon after that. That the Bank of England took pity on her reveals the complex attitudes to philanthropy and wealth during the Georgian period.

  The change of the Bank of England from early modern money warehouse to a financial temple began both from within and without. Sadly, little of Soane’s original exists today. It was largely demolished in the 1930s, when Herbert Baker was charged with bringing the buildings up to date. The destruction of Soane’s work was described by Nikolaus Pevsner as an ‘architectural crime’. The Bank of England, dealer in money, looks south across the road to the Royal Exchange. Since Thomas Gresham built the Exchange in 1565, it had housed London’s trade in commodities and was where native and foreign merchants gathered to conduct their business. Their trade was based on real commodities – such as spices, cloths, furs and gold – but things were changing. Just as the Bank of England became a reality in 1694, others, in the small coffee houses of Exchange Alley on the south side of the Royal Exchange, were starting to deal in what would become known as ‘stocks’ and ‘shares’.

  THE COFFEE HOUSES OF EXCHANGE ALLEY AND THE SOUTH SEA BUBBLE

  The elite cabal of the Bank of England had opened a book in Mercers’ Hall for ordinary Londoners who wanted to invest. Investment was becoming increasingly appealing to the emerging middle classes who, for the first time, due to international trade and the boom in the City were finding themselves with spare cash. The rise in newspapers meant foreign and financial news was more easily circulated, and in London a particular type of venue hosted a class of men on the make: coffee houses.

  Coffee houses were as numerous in Georgian London as they are now. They were places for men to gather and obtain news. Then, as now, many business meetings were conducted there. Coffee, although condemned initially as ‘Mahometan gruel’, suited their purpose better than wine, as it did not dull the senses. Although alcohol was available at most coffee houses, the atmosphere was one of professional sobriety. The ‘Turkey merchants’ had long been familiar with coffee, having been given it on their trips abroad, where it was served by their hosts ‘in little China dishes, as hot as they can suffer it; black as Soot and tasting not unlike it’. The purging nature of hot, strong coffee was soon seized upon by London’s quack health writers and in no time at all it was used to cure anything from the gout to period pain. Its stimulating effects were purported to sharpen the brain for commerce.

  London’s first coffee house was opened in 1652, in a shed on St Michael’s Alley, by Pasqua Rosée, a Greek born in Sicily who had come to London as a servant. In the same year he published an advertising flyer, The Vertue of the Coffee Drink, advertising his coffee as ‘a simple innocent thing, composed into a drink, by being dryed in an oven and ground to powder and boiled up with spring water’. Rosée asserted coffee had medicinal benefits, but it also gave imbibers the advantage of staying sober during business hours. His shed became known as The Turk’s Head, owing to his dark appearance and the fact that he used his own likeness as the shop sign. More coffee houses were springing up in the area; by the time Rosée disappeared from London in uncertain circumstances, coffee houses were part of the street scenery, even if they weren’t welcomed by everyone. One early coffee house proprietor, John Farr, was prosecuted by his neighbour because his business created an offensive smell, but by 1663 there were 83 licensed coffee houses in London, almost all of them near the Royal Exchange. They tended to specialize in a clientele with particular commercial interests in the Baltic or Levantine trade; they would carry the pertinent newspapers, and write up on chalkboards the news of ships about to dock or depart. Just how important these coffee houses were to City trade is seen in their rapid spread: almost 500 of them had appeared by the time George I was crowned in 1714.

  The coffee houses represented an important mixture of common business and intellectual interests, sobriety and socializing. A large selection of newspapers were part of coffee house culture from the start, and thus patrons could keep up with all the latest domestic and foreign happenings. The papers were often complemented by a small selection of books, such as that offered by Walsal ‘the Coffee-man against Cree-Church in Leadenhall-Street’ who kept ‘a Library in his Coffee-Room for his Customers to read’. Sometimes the library was run by the coffee house owner’s wife; these collections became some of the first lending libraries in London. Thus with their themed interests, their emphasis on business and their congenial surroundings, the coffee houses became an acceptable place for men of almost every culture and faith to be seen in, particularly those who otherwise would not venture into taverns or alehouses.

  By 1690, there were at least 100 companies selling stocks that were traded in London. Their value fluctuated according to the news that came and went along the international information routes: the ships coming and going from London’s docks. News of lost cargoes, huge hauls, diseased crews and delays for repair were brought back by thousands of vessels, both large and small. The coffee houses employed boys to go to the mouth of the Thames, wait for news and watch for ships. Then they would report back their findings, which would be displayed on a board behind the bar. Entry to the coffee house cost a penny, with the coffee, newspapers and current news included. Suddenly, literacy came to mean not only an increased chance of employment but also the ability to grasp fleeting opportunities from information disp
layed in the coffee houses. The entrepreneurial self-improving men the coffee houses attracted resulted in these establishments being nicknamed ‘Penny Universities’.

  Investment trading suffered an early setback with the great fiasco of the South Sea Bubble in 1720, which changed the nation’s attitude to investing in stocks for the rest of the Georgian period. The South Sea Company was founded in 1711 and operated using money from government bonds. These bonds paid a low return, so Robert Harley, the Lord Treasurer, offered to exchange the government bonds for stock in the South Sea Company. This would then give a greater return, as the company was operating so profitably.

  In 1719, the South Sea Company wished to purchase more of the government debt, and so the company issued more shares for this purpose. To get people to buy the shares, agents were sent out amongst the traders in the coffee houses of Exchange Alley, spreading rumours of massive trading opportunities in the South Seas, with huge profits to be had. The names of prominent politicians who already held shares were freely circulated. The share price shot up from £128 in January to £550 at the end of May. In June, the government passed the Joint Stock Act to regulate the formation of such companies, but this only gave further impetus to the galloping rise in the already established South Sea Company, with the share price nearing £1,000 in August.

  It couldn’t last, and the sheer volume of selling triggered a fall which snowballed into a crash. By the time the year was out, the price was back down to near its original level. Many were ruined. Ordinary Londoners came to fear the trade in stocks, often preferring to buy a ticket for the increasingly popular public and private lotteries instead. The instability of the market became the subject of cartoons, songs and popular literature, and stockbrokers, known as ‘jobbers’, came to be seen as shady and unreliable.