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January 6, 2025 • 53min
#375 The Single Biggest Individual Financier In The World. The Richest Woman In America: Hetty Green
Founders
Hetty Green was America's first female tycoon and the richest woman in America during the Gilded Age. She built a vast financial empire through shrewd investments in stocks, bonds, railroads and real estate. Operating as a one-woman bank, she even bailed out New York City multiple times. This episode examines her remarkable life and business philosophy based on two biographies: "Hetty: The Genius and Madness of America's First Female Tycoon" by Charles Slack and "The Richest Woman in America: Hetty Green in the Gilded Age" by Janet Wallach.
#375 The Single Biggest Individual Financier In The World. The Richest Woman In America: Hetty Green
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Key Takeaways
- Defiantly Independent - Hetty Green rejected societal norms and expectations, trusted her own judgment, and operated independently as one of the most successful financiers of her era
- Early Business Education - Learned finance and business from her father and grandfather from a young age by reading financial reports, visiting business operations, and keeping detailed accounts
- Investment Strategy - "Buy when things are low and nobody wants them. Keep them until they go up and people are crazy to get them." Consistently bought assets during financial panics
- Cash Position - Maintained large cash reserves and avoided debt, allowing her to capitalize on opportunities during market crashes and financial panics
- Work Ethic - Maintained a rigorous daily routine, did all research and analysis herself, and was completely devoted to her work which she saw as both duty and pleasure
- Teaching Children - Trained her children in business from an early age, emphasized self-reliance, and taught them through real-world experience
- Personal Rules - Lived by her own rules rather than society's expectations, maintained extreme frugality despite her wealth, and operated with intense focus and paranoia
Introduction
Hetty Green was America's first female tycoon and the richest woman in America during the Gilded Age. She built a vast financial empire through shrewd investments in stocks, bonds, railroads and real estate. Operating as a one-woman bank, she even bailed out New York City multiple times. This episode examines her remarkable life and business philosophy based on two biographies: "Hetty: The Genius and Madness of America's First Female Tycoon" by Charles Slack and "The Richest Woman in America: Hetty Green in the Gilded Age" by Janet Wallach.
Topics Discussed
Early Life and Business Education (6:00)
Born into a wealthy whaling family in New Bedford, Massachusetts (then the richest city per capita in the world), Hetty received an unconventional but thorough business education from her father and grandfather:
- Had to read financial news and business reports to them due to their poor eyesight
- Required to keep detailed accounts of expenses from a young age
- Learned about stocks, bonds, market fluctuations through direct exposure
- Visited all aspects of family business operations including whaling docks
- Taught core principle that each generation must grow family wealth
Father's Influence and Inheritance (20:00)
Her father shaped her business philosophy but their relationship was complex:
- Key Business Lessons:
- Never take on debt
- Keep substantial cash reserves
- Buy assets during market panics
- Move quietly and strategically
- Inheritance Betrayal:
- Father put majority of $5.7M inheritance in trust
- Only gave her direct control of $900,000
- Drove her determination to prove herself
Investment Strategy and Approach (35:00)
Hetty developed a clear and consistent investment philosophy:
- Core Strategy: "I buy when things are low and nobody wants them. I keep them until they go up and people are crazy to get them."
- Key Elements:
- Maintain large cash reserves
- Buy during market panics
- Focus on fundamental value
- Hold for long term
- Research Process:
- Read everything herself
- Questioned and investigated thoroughly
- Analyzed costs, assets, and debts in detail
- Moved quietly when executing trades
Real Estate Empire (50:00)
Built massive real estate holdings through strategic acquisitions:
- Bought properties through foreclosure on mortgages she held
- Owned buildings across New York, Chicago, St. Louis, Boston
- Rarely bought properties outright on open market
- Held properties long-term once acquired
- Portfolio included churches, cemeteries, theaters, hotels, farms
Railroad Investments (1:05:00)
Made significant investments in railroad industry:
- Georgia Central Railroad:
- Quietly accumulated large position
- Waited patiently as stock rose
- Negotiated premium price for shares
- Made $385,000 profit on deal
- Texas Midland Railroad:
- Bought railroad out of foreclosure
- Put son Ned in charge at age 24
- Used as training ground for next generation
Teaching Her Children (1:25:00)
Focused on preparing her children to manage wealth:
- Core Principles:
- Start business training in infancy
- Learn industries from ground up
- Develop self-reliance
- Watch pennies carefully
- Son's Training:
- Started as railroad clerk at bottom
- Made him solve problems independently
- Gave him real responsibility with Texas railroad
Role as Financial Power (1:45:00)
Emerged as major financial force:
- Bailed out New York City multiple times
- Interest rate decisions moved markets
- Operated as one-woman Federal Reserve
- Largest individual financier in world
- Kept gun on desk to back up threats when needed
Personal Traits and Habits (2:05:00)
Distinctive personal characteristics:
- Work Habits:
- Strict daily routine
- First to arrive, last to leave bank
- Did all analysis personally
- Kept detailed records
- Personal Style:
- Extremely frugal despite wealth
- Secretive about holdings
- Operated independently
- Focused solely on business
Business Maxims and Legacy (2:25:00)
Left behind clear business principles:
- Key Maxims:
- Seek all available information before investing
- Watch pennies and dollars take care of themselves
- Sleep on important decisions
- Buy when others are selling, sell when others are buying
- Legacy:
- Proved women could succeed in male-dominated finance
- Demonstrated value of independence and self-reliance
- Showed importance of maintaining liquidity
- Exemplified disciplined, contrarian investing
Conclusion
Hetty Green was a pioneering female financier who built extraordinary wealth through disciplined investing, maintaining liquidity, and capitalizing on market panics. Her success came from combining rigorous business education with fierce independence and unwavering focus on fundamental value. Though often misunderstood in her time, her investment principles and emphasis on self-reliance remain highly relevant today.