2nd Feb, 2023 11:00 EST

Books and Manuscripts

 
  Lot 35
 

35

[Business, Industry & Finance] [Panic of 1792]
The Concern of William Duer, Alexander Macomb & Isaac Whippo in Account Current with Francis Ingraham

Contemporary Account Ledger Related to the Panic of 1792, America's First Financial Crisis, Detailing Losses Of Three Of Its Perpetrators

(Philadelphia), July 20, 1792. One sheet, 17 3/8 x 22 3/8 in. (441 x 568 mm) Manuscript ledger sheet, titled “The Concern of William Duer, Alexander Macomb & Isaac Whippo in Account Current with Francis Ingraham”, detailing Ingraham's extensive financial activity with Duer, Macomb, and Whippo, et al., totaling $301,286.39. Endorsed on verso by Ingraham: “July 20 1792/Error Excepted/Francis Ingraham.” Unevenly toned; old folds; scattered ink stains.

Francis Ingraham (1764-1848), was a brokerage agent for many securities speculators of the time, and was the Philadelphia representative for William Duer and his stock interests. This account ledger covers the period of January through July, 1792, and mentions: Clement Biddle (1740-1814); President of the First Bank of the United States, Thomas Willing (1731-1821); John Pintard (1759-1844); former Continental Army surgeon Isaac Bronson (1760-1838); merchant John Swanwick (1760-1798); Thomas L. Moore; Richard Footman; Edward Fox; Samuel Anderson; Daniel Parker; John Williams; Joseph Boggs; Lewis Deblois; Joseph Anthony; Samuel Hays; Pearson Hunt; Benjamin Walker; E. Randolph; Thomas McEwen; George Eddy; Andrew Summers; James Glentworth; the firms of Lewis and Tilghman, Gardner and Rodman, and Hazard and Addams.

William Duer (1743-99) was a British-born Continental Congressman, Signer of the Articles of Confederation, and served as Assistant Secretary of the Treasury. Following the American Revolution, he became heavily involved in land speculating and the trading of U.S. securities. In 1791, the First Bank of the United States was founded, and shortly thereafter introduced the sale of "scrips" (stocks), as outlined in the original plan proposed by First Secretary of the Treasury, Alexander Hamilton. Duer continued land speculating but began recklessly trading bank scrips, and allied himself with Alexander Macomb (1748-1831) a wealthy fur trader and speculator who had acquired millions of acres of land in western New York dubbed “Macomb’s Purchase.” The men agreed to jointly speculate in stocks, and formulated a plan to control the U.S. market by pooling their resources to corner it, then sell the appreciated assets at huge profits later. The two had a coterie of other speculators working with them such as Isaac Whippo (1742-1807), Walter Livingston, Richard Platt, John Pintard, and George Knox. Together these men established credit by endorsing each other’s notes to continue borrowing or speculating. Duer was not a stranger to the dangers of this system, as he almost went bankrupt during the financial bubble of 1791 but survived due to a government bailout. In the first months of 1792, Duer and Macomb began trading large quantities of securities from a number of banks (Bank of the United States, Bank of North America, Bank of New York) in order to drive up prices. Brokers in cities across the country were goaded by the trading fervor, and many began closing riskier deals with shorter maturation periods. The price of bank shares reached their peak at the end of January 1792 then started to deeply fluctuate over a few weeks before eventually plummeting. In March of 1792, after exhausting all possible sources of credit available to him, Duer was forced to default on his loans. The United States Treasury department filed suit against him for a debt he incurred while Assistant Secretary, a warrant was issued for his arrest, and he was taken to debtors' prison, where he would remain for the rest of his life. Duer's total debts are estimated to have been almost $3,000,000 (roughly $95,000,000 in today's currency), and his failure caused a country-wide financial panic. Like Duer, Macomb failed and was taken to debtors' prison as well but only served a brief stint and eventually regained his wealth. Isaac Whippo was also briefly imprisoned and reportedly fled to Holland afterward to evade his creditors.

Economist Joseph Stancliffe Davis wrote in his Essays in the Earlier History of American Corporations, "He (Alexander Macomb) was just the sort of man for Duer to have as a real associate...the pooling of the capital and credit, as well as the experience, of the two men made a combination much to be respected... Others in Duer's coterie were drawn into the group...(they) came eventually to be spoken of as 'the Company'... Evidence is lacking as to which of the partners formulated a definite policy (of market manipulation). Rumour had it, at various times, that Duer sought to corner at least the United States six per cents. The purpose is variously stated. Benjamin Rush reported late in March hearing they proposed to sell these stocks to foreigners at a considerable advance. Seth Johnson, writing from intimate observation in New York early in April, 1792, referred to their plan as one 'to Command all of the floating Stock, create a Scarcity & oblige the deliverers...to settle the difference on favorable terms to the receivers;' in short to squeeze the speculators... Several reports, however, agree that a corner was attempted." (p. 280-81 Harvard University Press 1917).

Ingraham's ledger extensively lists the financial activity of numerous individuals and firms that presumably contributed to the United States's first nation-wide financial panic. Notable entries detailing the depreciation in stock values traded by Duer, Macomb, and Whippo include: March 31, 1792: Ingraham pays $7,625 to James McEvers for shares of 3% Bank of the United States stock, originally endorsed by William Duer for $10,000; April 15, 1792: Ingraham pays $27,300 worth of 3% Bank of U.S. Stock to Thomas McEwen, originally endorsed by William Duer and Alexander Macomb for $34,000; May 20, 1792: Ingraham pays $123,506 to Pearson Hunt on account of notes endorsed by Alexander Macomb; May 20, 1792: Ingraham settles his account with Isaac Whippo, who takes a loss of $12,272.74. The same day William Duer’s account is settled with Ingraham for a loss of $15,810.28. This entry is marked as "Settled by his attorney” (due to his incarceration); July 20, 1792: Ingraham pays $51,330 for accepting Alexander Macomb’s bills due for stocks of the Bank of the United States.

Secretary of State Thomas Jefferson, who was opposed to securities trading, wrote of Duer shortly after his arrest, “Here the unmonied farmer, as he is termed, his cattle & crops are no more thought of than if they did not feed us. Scrip & stock are food and raiment here. Duer, the king of the alley, is under a sort of check. The stock sellers say he will rise again. The stock buyers count him out, and the credit & fate of the nation seem to hang on the desperate throws & plunges of gambling scoundrels…” (The Works of Thomas Jefferson, ed. Paul L. Ford, p. 455). Later that year, on May 17, 1792, 24 New York stockbrokers signed the Buttonwood Agreement, the first attempt to standardize securities trading in America, but reforms to deter market manipulation would not be enacted until 1817.

Estimate
$3,000 - $5,000
 

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Contemporary Account Ledger Related to the Panic of 1792, America's First Financial Crisis, Detailing Losses Of Three Of Its Perpetrators

(Philadelphia), July 20, 1792. One sheet, 17 3/8 x 22 3/8 in. (441 x 568 mm) Manuscript ledger sheet, titled “The Concern of William Duer, Alexander Macomb & Isaac Whippo in Account Current with Francis Ingraham”, detailing Ingraham's extensive financial activity with Duer, Macomb, and Whippo, et al., totaling $301,286.39. Endorsed on verso by Ingraham: “July 20 1792/Error Excepted/Francis Ingraham.” Unevenly toned; old folds; scattered ink stains.

Francis Ingraham (1764-1848), was a brokerage agent for many securities speculators of the time, and was the Philadelphia representative for William Duer and his stock interests. This account ledger covers the period of January through July, 1792, and mentions: Clement Biddle (1740-1814); President of the First Bank of the United States, Thomas Willing (1731-1821); John Pintard (1759-1844); former Continental Army surgeon Isaac Bronson (1760-1838); merchant John Swanwick (1760-1798); Thomas L. Moore; Richard Footman; Edward Fox; Samuel Anderson; Daniel Parker; John Williams; Joseph Boggs; Lewis Deblois; Joseph Anthony; Samuel Hays; Pearson Hunt; Benjamin Walker; E. Randolph; Thomas McEwen; George Eddy; Andrew Summers; James Glentworth; the firms of Lewis and Tilghman, Gardner and Rodman, and Hazard and Addams.

William Duer (1743-99) was a British-born Continental Congressman, Signer of the Articles of Confederation, and served as Assistant Secretary of the Treasury. Following the American Revolution, he became heavily involved in land speculating and the trading of U.S. securities. In 1791, the First Bank of the United States was founded, and shortly thereafter introduced the sale of "scrips" (stocks), as outlined in the original plan proposed by First Secretary of the Treasury, Alexander Hamilton. Duer continued land speculating but began recklessly trading bank scrips, and allied himself with Alexander Macomb (1748-1831) a wealthy fur trader and speculator who had acquired millions of acres of land in western New York dubbed “Macomb’s Purchase.” The men agreed to jointly speculate in stocks, and formulated a plan to control the U.S. market by pooling their resources to corner it, then sell the appreciated assets at huge profits later. The two had a coterie of other speculators working with them such as Isaac Whippo (1742-1807), Walter Livingston, Richard Platt, John Pintard, and George Knox. Together these men established credit by endorsing each other’s notes to continue borrowing or speculating. Duer was not a stranger to the dangers of this system, as he almost went bankrupt during the financial bubble of 1791 but survived due to a government bailout. In the first months of 1792, Duer and Macomb began trading large quantities of securities from a number of banks (Bank of the United States, Bank of North America, Bank of New York) in order to drive up prices. Brokers in cities across the country were goaded by the trading fervor, and many began closing riskier deals with shorter maturation periods. The price of bank shares reached their peak at the end of January 1792 then started to deeply fluctuate over a few weeks before eventually plummeting. In March of 1792, after exhausting all possible sources of credit available to him, Duer was forced to default on his loans. The United States Treasury department filed suit against him for a debt he incurred while Assistant Secretary, a warrant was issued for his arrest, and he was taken to debtors' prison, where he would remain for the rest of his life. Duer's total debts are estimated to have been almost $3,000,000 (roughly $95,000,000 in today's currency), and his failure caused a country-wide financial panic. Like Duer, Macomb failed and was taken to debtors' prison as well but only served a brief stint and eventually regained his wealth. Isaac Whippo was also briefly imprisoned and reportedly fled to Holland afterward to evade his creditors.

Economist Joseph Stancliffe Davis wrote in his Essays in the Earlier History of American Corporations, "He (Alexander Macomb) was just the sort of man for Duer to have as a real associate...the pooling of the capital and credit, as well as the experience, of the two men made a combination much to be respected... Others in Duer's coterie were drawn into the group...(they) came eventually to be spoken of as 'the Company'... Evidence is lacking as to which of the partners formulated a definite policy (of market manipulation). Rumour had it, at various times, that Duer sought to corner at least the United States six per cents. The purpose is variously stated. Benjamin Rush reported late in March hearing they proposed to sell these stocks to foreigners at a considerable advance. Seth Johnson, writing from intimate observation in New York early in April, 1792, referred to their plan as one 'to Command all of the floating Stock, create a Scarcity & oblige the deliverers...to settle the difference on favorable terms to the receivers;' in short to squeeze the speculators... Several reports, however, agree that a corner was attempted." (p. 280-81 Harvard University Press 1917).

Ingraham's ledger extensively lists the financial activity of numerous individuals and firms that presumably contributed to the United States's first nation-wide financial panic. Notable entries detailing the depreciation in stock values traded by Duer, Macomb, and Whippo include: March 31, 1792: Ingraham pays $7,625 to James McEvers for shares of 3% Bank of the United States stock, originally endorsed by William Duer for $10,000; April 15, 1792: Ingraham pays $27,300 worth of 3% Bank of U.S. Stock to Thomas McEwen, originally endorsed by William Duer and Alexander Macomb for $34,000; May 20, 1792: Ingraham pays $123,506 to Pearson Hunt on account of notes endorsed by Alexander Macomb; May 20, 1792: Ingraham settles his account with Isaac Whippo, who takes a loss of $12,272.74. The same day William Duer’s account is settled with Ingraham for a loss of $15,810.28. This entry is marked as "Settled by his attorney” (due to his incarceration); July 20, 1792: Ingraham pays $51,330 for accepting Alexander Macomb’s bills due for stocks of the Bank of the United States.

Secretary of State Thomas Jefferson, who was opposed to securities trading, wrote of Duer shortly after his arrest, “Here the unmonied farmer, as he is termed, his cattle & crops are no more thought of than if they did not feed us. Scrip & stock are food and raiment here. Duer, the king of the alley, is under a sort of check. The stock sellers say he will rise again. The stock buyers count him out, and the credit & fate of the nation seem to hang on the desperate throws & plunges of gambling scoundrels…” (The Works of Thomas Jefferson, ed. Paul L. Ford, p. 455). Later that year, on May 17, 1792, 24 New York stockbrokers signed the Buttonwood Agreement, the first attempt to standardize securities trading in America, but reforms to deter market manipulation would not be enacted until 1817.

  

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All property offered and sold (“property”) through Samuel T. Freeman & Co, (“Freeman’s”) shall be offered and sold on the terms and conditions set forth below which constitutes the complete statement of the terms and conditions on which all property is offered for sale. By bidding at the auction, whether present in person or by agent, by written bid, telephone, internet or other means, the buyer agrees to be bound by these terms and conditions.

1. Unless otherwise indicated, all Property will be offered by Freeman’s as agent for the Consignor.

2. Freeman’s reserves the right to vary the terms of sale and any such variance shall become part of these Conditions of Sale.

3. As a result of the Covid-19 Pandemic, in person inspections of the Property are available by appointment only and therefore, Freeman’s has also made available to the Buyer the opportunity to (a) view the lot online at freemansauction. com and to view the auction’s e-catalogue, (b) submit a request for a condition report either through the online lot listing or by contacting the specialist directly and (c) have a virtual consultation with the specialist. Buyer acknowledges that it has had the right to take advantage of the aforementioned inspections prior to the sale to determine the condition, size, repair or restoration of any Property. Buyer acknowledges that  it had the right to make a full inspection of all Property prior to sale to determine the condition, size, repair or restoration of any Property. Therefore, all property is sold “AS-IS”. Freeman’s is acting solely as an auction broker, and unless otherwise stated, does not own the Property offered for sale and has made no independent investigation of the Property. Freeman’s makes no warranty of title, merchantability or fitness for a particular purpose, or any other warranty or representation regarding the description, genuineness, attribution, provenance or condition to the Property of any kind or nature with respect to the Property.

4. Freeman’s in its sole and exclusive discretion, reserves the right to withdraw any property, at any time, before the fall of the hammer.

5. Unless otherwise announced by the auctioneer at the time of sale, all bids are per lot as numbered in the printed catalogue. Freeman’s reserves the right to determine any and all matters regarding the order, precedence or appropriate increment of bids or the constitution of lots.

6. The highest bidder acknowledged by the auctioneer shall be the buyer. The auctioneer has the right to reject any bid, to advance the bidding at his absolute discretion and in the event of any dispute between bidders, the auctioneer shall have the sole and final discretion either to determine the successful bidder or to re- offer and resell the article in dispute. If any dispute arises after sale, the Freeman’s sale record shall be conclusive in all respects.

7. If the auctioneer determines that any opening or later bid or any advance bid is not commensurate with the value of the Property offered, he may reject the same and withdraw the Property from sale.

8. Upon the fall of the hammer, title to any offered lot or article will immediately pass to the highest bidder as determined in the exclusive discretion of the auctioneer, subject to compliance by the buyer with these Conditions of Sale. Buyer thereupon assumes full risk and responsibility of the property sold, agrees to sign any requested confirmation of purchase, and agrees to pay the full price, plus Buyer’s Premium, therefore or such part, upon such terms as Freeman’s may require.

9. No lot may be removed from Freeman’s premises until the buyer has paid in full the purchase price therefor including Buyer’s Premium or has satisfied such terms that Freeman’s, in its sole discretion, shall require. Subject to the foregoing, all Property shall be paid for and removed by the buyer at his/her expense within ten (10) days of sale and, if not so removed, may be sold by Freeman’s, or sent by Freeman’s to a third-party storage facility, at the sole risk and charge of the buyer(s), and Freeman’s may prohibit the buyer from participating, directly or indirectly, as a bidder or buyer in any future sale or sales. In addition to other remedies available to Freeman’s by law, Freeman’s reserves the right to impose a late charge of 1.5% per month of the total purchase price on any balance remaining ten (10) days after the day of sale. If Property is not removed by the buyer within ten (10) days, a handling charge of 2% of the total purchase price per month from the tenth day after the sale until removal by the buyer shall be payable to Freeman’s by the buyer. Freeman’s will not be responsible for any loss, damage, theft, or otherwise responsible for any goods left in Freeman’s possession after ten (10) days. If the foregoing conditions or any applicable provisions of law are not complied with, in addition to other remedies available to Freeman’s and the Consignor (including without limitation the right to hold the buyer(s) liable for the bid price) Freeman’s, at its option, may either cancel the sale, retaining as liquidated damages all payments made by the buyer(s), or resell the property. In such event, the buyer(s) shall remain liable for any deficiency in the original purchase price and will also be responsible for all costs, including warehousing, the expense of the ultimate sale, and Freeman’s commission at its regular rates together with all related and incidental charges, including legal fees. Payment is a precondition to removal. Payment shall be by cash, certified check or similar bank draft, or any other method approved by Freeman’s. Checks will not be deemed to constitute payment until cleared. Any exceptions must be made upon Freeman’s written approval of credit prior to sale. In addition, a defaulting buyer will be deemed to have granted and assigned to Freeman’s, a continuing security interest of first priority in any property or money of, or owing to such buyer in Freeman’s possession, and Freeman’s may retain and apply such property or money as collateral security for the obligations due to Freeman’s. Freeman’s shall have all of the rights accorded a secured party under the Pennsylvania Uniform Commercial Code.

10. Unless the sale is advertised and announced as “without reserve”, each lot is offered subject to a reserve and Freeman’s may implement such reserves by bidding through its representatives on behalf of the Consignors. In certain instances, the Consignor may pay less than the standard commission rate where Freeman’s or its representative is a successful bidder on behalf of the Consignor. Where the Consignor is indebted to Freeman’s, Freeman’s may have an interest in the offered lots and the proceeds therefrom, other than the broker’s Commissions, and all sales are subject to any such interest.

11. No “buy” bids shall be accepted at any time for any purpose.

12. Any pre-sale bids must be submitted in writing to Freeman’s prior to commencement of the offer of the first lot of any sale. Freeman’s copy of any such bid shall conclusively be deemed to be the sole evidence of same, and while Freeman’s accepts these bids for the convenience of bidders not present at the auction, Freeman’s shall not be responsible for the failure to execute, or, to execute properly, any pre-sale bid.

13. A Buyer’s Premium will be added to the successful bid price and is payable by the buyer as part of the total purchase price. The Buyer’s Premium shall be: 26% on the first $600,000 of the hammer price of each lot, 21% on the portion from $600,001 through $4,000,000 and 15% thereafter.

14. Third-Party Internet Bidding Services (a) Third Party Bidding Platforms. We engage third party online bidding platforms to collect or facilitate auction bids (“Bidding Platforms”), each of which levy a fee for their services, and have their own rules on fees and how to bid and buy online using these Bidding Platforms. Freeman’s has no control over, and assumes no responsibility for, the content, privacy policies, or practices of any Bidding Platforms. Your dealings with Bidding Platforms are solely between you and such Bidding Platforms. We encourage you to be aware of, and to read, the terms and conditions and privacy policy of any Bidding Platforms that you visit. You expressly release Freeman’s from any and all liability arising from your use of any Bidding Platform or other third-party website or service. (b) Waiver. Absentee Bids left with Bidding Platforms are released to Freeman’s when a lot comes up for sale. UNDER NO CIRCUMSTANCES, INCLUDING, BUT NOT LIMITED TO, NEGLIGENCE, WILL WE AND OUR SELLERS BE LIABLE FOR ANY DAMAGES, LOST PROFITS OR ANY SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES THAT RESULT FROM THE USE OF, OR THE INABILITY TO USE, THESE BIDDING PLATFORMS.  

15. Unless exempted by law from the payment thereof, the buyer will be required to pay any and all federal excise tax and any state and/or local sales taxes, including where deliveries are to be made outside the state where a sale is conducted, which may be subject to a corresponding or compensating tax in another state.

All purchases made at Freeman’s, therefore, will be subject to the Pennsylvania State and Local sales tax--currently at a combined rate of 8%, which is applied to the hammer price plus buyer’s premium--unless the successful buyer submits the required tax exemption documentation. Those seeking exemption from sales tax must provide a valid certificate to Freeman’s prior to outgoing shipment.

In accordance with Pennsylvania State law, if Freeman’s or the buyer arranges for a lot/s to be shipped outside of Pennsylvania through an independent, third-party shipping company, Freeman’s must collect Pennsylvania sales tax on the lot/s irrespective of the property’s final destination. If the item is first delivered to any hired service provider (e.g. restorer, storage facility, etc.) located in Pennsylvania, Pennsylvania sales tax will still be applicable and invoiced, even if the lot will ultimately be shipped out-of-state.

16. Freeman’s may, as a service to buyer, arrange to have purchased property posted and shipped at the buyer’s expense. Freeman’s is not responsible for any acts or omissions in packing or shipping of purchased lots whether or not such carrier is recommended by Freeman’s. Packing and handling of purchased lots is at the responsibility of the buyer and is at the entire risk of the buyer.

17. In no event shall any liability of Freeman’s to the buyer exceed the purchase price actually paid.

18. No claimed modification or amendment of this Agreement on the part of any party shall be deemed extant, enforceable or provable unless it is in writing that has been signed by the parties to this Agreement. No course of dealing and no delay or omission on the part of Freeman’s in exercising any right under this Agreement shall operate as a waiver of such right or any other right and waiver on any one or more occasions shall not be construed as a bar to or waiver of any right or remedy of Freeman’s on any future occasion.

19. These Conditions of Sale and the buyer’s, the Consignor’s and Freeman’s rights under these Conditions of Sale shall be governed by, construed and enforced in accordance with the laws of the Commonwealth of Pennsylvania and Consignor and Buyer agree to the exclusive jurisdiction of the Philadelphia, Pennsylvania Court of Common Pleas and the United States District Court for the Eastern District of Pennsylvania.   

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