What is the role of financial advice?

With the work of Wall Street increasingly part of Main Street, these legions of amateur investors needed advice. And the publishing industry obliged.

From the 1880s onwards, in both Britain and America, there was an explosion of writing about the stock market. Financial journalism, stock broker memoirs, Wall Street fiction and investment advice manuals all fuelled a popular fascination with the stock market. Earlier in the century, guides to the stock market tended to take a moralising approach. But from the middle of the nineteenth century, books and articles began to provide factual information.

They explained how the stock market worked, and introduced tables and charts of statistics. By the end of the century, the guidebooks increasingly offered practical advice on how to make money through speculation. Some of the books merely compiled general maxims, such as buy cheap and sell dear. Others offered more precise instructions on how to respond to particular market trends.

Much of the advice was on which stocks to buy and when to sell them. But others writers focused instead on the kind of personal qualities needed for successful speculation. The ideal speculator was cool, calm and manly. It comes as little surprise that most financial advice was written by men for men. Women were seen as too emotional and unpredictable. But the reality is that a quarter of investments in this period were held by women, who were often well informed about the market. Hetty Green, for example, ran her own brokerage on Wall Street and amassed a sizeable fortune. Known as the “Witch of Wall Street,” Green was an astute investor who played up her country-bumpkin ways for the press.

^{Hetty Green 1834-1916 at a ‘referee’s session’ possibly when she disputed the accounting of Henry A Barling the surviving executor of estate of Hetty Green’s father Edward Mott Robinson. Ca. 1895. ©Shutterstock/Everett Historical}

Many of the books were written by brokers in response to popular demand. They emphasised their professionalism and made investment seem safe. Some books, however, served as glorified adverts for the brokerage firms that offered them for free. In other cases, they were part of a scam, designed to tempt the unwitting into foolish speculation.

Books discussed in the video

• Duguid C. How to Read the Money Article. 2nd ed. London: Effingham Wilson; 1901.
• Morier Evans D. Facts, Failures, and Frauds: Revelations, Financial, Mercantile, Criminal. New York: Augustus M Kelley; 1968 [1859].
• Morier Evans D. Speculative Notes and Notes on Speculation, Ideal and Real. New York: Augustus M. Kelley; 1969 [1864].
• Mortimer T. Every Man His Own Broker. Or, a Guide to Exchange Alley. 1761.
• Smith M. Plain Truths About Stock Speculation: How to Avoid Losses in Wall Street. Brooklyn, NY: EV Smith; 1887.
• Wyckoff RD. Studies in Tape Reading. New York, NY: The Ticker Publishing Company; 1910.

Roundtable discussion

This step is the first of five steps covering a roundtable discussion about financial advice. Each member of the team shares information about his/her area of specialism:

• Helen is an economic historian with specialisms in the late seventeenth and eighteenth centuries. Her research concerns the Financial Revolution, especially the South Sea Bubble and the Triangular Trade including the slave trade, and Atlantic history.
• James is an economic historian who works on the history of Britain during the nineteenth century. His research concerns the cultural, political, and legal dimensions of economic change
• Peter is a cultural historian and literary critic who works on the importance of literary narrative and cultural representation in American in the 19th and 20th century.
• Paul is a cultural historian and literary critic who works on the interface between literary and cultural innovation and historical change in Britain and America in the twentieth and twenty-first centuries.
• Nicky is a cultural historian and literary critic who works on feminism and representations of money and finance in British and American culture.