Abstract: New Gowns, Morocco Shoes, and Little Monsters: Eastern Capital and Mortgage Credit in Ohio, 1835-1850

Mark Stickle

Abstract

Organized and funded by eastern investors, the Ohio Life Insurance and Trust Company was chartered by a skeptical Ohio legislature in 1834. Throughout its twenty-three year life, the Company was a flash point in debates about the proper role of financial capital in a democratic society. Although the Trust Company engaged in commercial banking, note issuance, and public finance, my paper focuses on its activities as the first significant institutional provider of mortgage credit in the trans-Appalachian West. Headquartered in Cincinnati and operating through agents located in towns across the state, the company made loans to borrowers in almost all of Ohio's counties. I examine the company's role as a specialized financial intermediary, and describe its response to the challenges of credit extension in a 'near-frontier' region. While images of predatory bankers and hard-pressed rural borrowers are deeply embedded in both the historiographic literature and popular culture, my work indicates that the situation in antebellum Ohio was more complex. I suggest that the Trust Company represented a reasonably effective vehicle for interregional capital transfer, providing important support for entrepreneurial farmers seeking to expand production to take advantage of newly available market opportunities.