The life of an entrepreneur in the 1830's was not an easy one, but because of the economic boom they were given a new hope. American entrepreneurs were considered "the most carless, reckless, headlong people on the face of the earth." An example of an American entrepreneur is Benjamin Rathbun. Rathbun was was Buffalos biggest self-made man, he had everything from real estate, building construction, banks, stores, transportation and not to mention his big success the Eagle Hotel. This man had it all until the sudden collapse in 1836. Rathbun was convicted of fraud when his dozen endorsments revealed to be forgeries. After Rathbuns fraud, Buffalo went downhill 8 months before the panic of 1837, since so many jobs relied on Rathbun and The Eagle Hotel. Historians calculated that one-fifth of all businessmen fizzled. Failures in the five years following the panic of 1837 led to two innovations in busness law and loan practices. First, government passed the U.S. Bankruptcy Act of 1841, a controversial law that allowed failed debtors to rid there debts legally. Second, the credit rating industry was born in 1841, where lenders could look into large books that contained confidential information that assessed the credit worthiness of local business men. If this were so in 1836, Rathbuns fraud may have been unmasked earlier. In 1843 Rathbun left prison and joined his wife. He then moved to New York City where he ran a series of hotels until the day of his death.
Question 1:
Rathbuns failure affected Buffalo 8 months before the Panic of 1837. If the town had been hit at the time of the Panic of 1837, do you think that buffalo would have been able to get back on its feet?
Question 2:
Do you think that Buffalo would have been better off withouth Rathbun's Eagle Hotel, considering more than a third of men were on his payroll?
No comments:
Post a Comment