"Sex, Insider Trading and the First U.S. Financial Panic: Echoes"

From Bloomberg:

One of the strangest pamphlets ever authored by an American public official appeared in 1797. Written by Alexander Hamilton -- a founding father and the first U.S. Secretary of the Treasury -- its title constituted a mini-essay in its own right.

It was called: "Observations on Certain Documents Contained in #s 5&6 of 'The History of the United States for the Year 1796,' in which Charges of Speculation Against Alexander Hamilton, Late Secretary of the Treasury, Is Fully Refuted by Himself."

The pamphlet had two purposes. First, Hamilton did something virtually inconceivable today. In an act of public humiliation, he apologized to his wife for carrying on an affair some years earlier when he was Treasury Secretary. He admitted that he bribed the woman's husband, James Reynolds, not only to hush up the assignation but to allow it to continue; in effect, Reynolds became his wife's pimp. Hamilton begged his own wife's forgiveness. This was a shabby business, to understate the situation.

But Hamilton's second purpose was to engage matters of state and questions about the future of the U.S. economy and the fate of the Revolution.

James Reynolds was a low-life, an obscure, frustrated place-seeker, who in the early 1790s befriended a New York aristocrat named William Duer. The son of mid-level British gentry, Duer had both supported the American Revolution and made a lot of money off it, sometimes by selling the Continental Army shoddy supplies, sometimes by holding foodstuffs and other essentials off the market to inflate prices.

He was, in other words, a distinctly American type: an aristocrat with his eye on the "main chance." When the new nation was born, Duer, along with other wealthy merchants and landowners, thought he spied "the next big thing."....MORE