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Hetty Green isn\u2019t a name you hear a lot these days\u2014but it should be. The whaling heiress turned investing guru was making millions and dishing out sage advice on Wall Street decades before the man known as the greatest investor of our era, Warren Buffett, was even born. And when Benjamin Graham, Buffett\u2019s hero and the man they call \u201cthe Father of value investing,\u201d was in grade school, Green had already made millions buying Civil War bonds, railroad stocks, and mines. She made a killing in mortgage lending, too\u2014never charging excessive interest, but likewise unafraid to foreclose if she wasn\u2019t receiving payments.<\/p>\n
Always a saver with extra cash on hand, Green lent freely to American businessmen, investors, and even the city of New York during times of need. And through it all, she preached many of the common sense, so-called \u201cvalue\u201d investing tips that Graham spent his career detailing\u2014the same ones you often hear Buffett espouse<\/a> today. But the Massachusetts native-turned-New Yorker was a working mother, and her fierce disposition and unwillingness to comport with what was believed to be a woman\u2019s place led to her estrangement from a society where she had few contemporaries.\u00a0<\/p>\n There\u2019s even a story about how Green pulled a gun on her rival, the railroad magnate Collis Potter Huntington, after he threatened her son Ned over a railroad dispute in Texas.\u00a0 \u201cUp to now Huntington, you have dealt with Hetty Green the business woman. Now you are fighting Hetty Green the mother,\u201d she reportedly<\/a> said. \u201cHarm one hair of Ned\u2019s head, and I\u2019ll put a bullet through your heart.\u201d\u00a0<\/p>\n Green made a fortune (and a few enemies) by sticking to disciplined investing principles that have become common today. However, she is mostly remembered for penny pinching and her choice to repeatedly wear the same black dress and veil later in life, something that led her to garner unfavorable nicknames like \u201cthe world\u2019s greatest miser\u201d and \u201cthe Witch of Wall Street.\u201d<\/p>\n But Hetty Green\u2019s true story is far more complex, and her nature much more generous, than the media of the late 1800s and early 1900s portrayed. If she were around today, she would be easily compared to Buffett and other great investors of our era.<\/p>\n Long before women were even given the right to vote, Green was a titan in a male-dominated field, earning the respect of the likes of John Pierpont Morgan, the American financier who founded what is now JPMorgan Chase<\/a>. It\u2019s no wonder why, really. Although she was known for her frugal nature, when the chips were down on Wall Street, investors turned to Hetty Green\u2014and not just for money to save their businesses, but also for advice. To say that was rare during the Gilded age of the late 1800s is understating it.<\/p>\n When Green died in July 1916, as the New York Times <\/em>put it in her obituary<\/a>, she was \u201cgenerally believed to be the world\u2019s richest woman,\u201d having amassed a fortune of $200 million, or nearly $6 billion today. From helping to save New York City during the 1907 panic to pulling a gun on a man who had threatened her son, Hetty Green was a complex character whose legacy has, in many ways, been tainted by biased coverage that focused on her miserliness.\u00a0<\/p>\n The real \u201cWitch of Wall Street,\u201d while undeniably cheap, wasn\u2019t a witch at all, more like an independent investing genius. As Charles Slack, who wrote a book on Green titled Hetty: The Genius and Madness of America\u2019s First Female Tycoon<\/em>, put it in an interview with Fortune<\/em>: \u201cShe had the courage to live as she chose.\u201d<\/p>\n Green only followed conventions that \u201cseemed to her right and useful, coldly and calmly ignoring all the others,\u201d he added.\u00a0<\/p>\n This is the tale of the misunderstood \u201cWitch of Wall Street,\u201d whose tips for making money and thriving in our complex world are as relevant today as they were over 100 years ago.<\/p>\n Henrietta (Hetty) Howland Robinson Green was born in 1834 in New Bedford, Massachusetts. The daughter of a conservative Quaker family that owned the largest whaling fleet in the city, Green learned about finance and trade from a young age, becoming the family\u2019s bookkeeper by age 13.<\/p>\n After attending a strict boarding school, Hetty went on to help her father with their businesses in New York City when he sold his whaling enterprise. There she met and married Edward Henry Green, a partner in a trading business. The two would go on to have two children, Edward and Harriet.<\/p>\n When Green\u2019s father died in 1865, she inherited around $5.9 million, or roughly $95 million today. The issue was $5 million of that money was locked in a trust that only gave her rights to its income. Even so, Green began buying stocks with what she had, conducting detailed research on companies to find those with the best \u201cvalue\u201d within the market. She always looked for \u201cunderpriced stocks\u201d and \u201cwas far less concerned with which way the market was heading,\u201d according to Slack, her biographer.<\/p>\n Green\u2019s investing strategies paralleled those that Graham described in his 1949 book, Intelligent Investor<\/em>, which has become a bible to many in the \u201cvalue investing\u201d community. Doing your homework, looking for quality companies, avoiding overvalued momentum stocks, these were all Hetty Green principles that Graham only detailed decades later.<\/p>\n Green was ahead of her time in many ways. She always avoided the use of leverage when investing, for example, something that Warren Buffett has recommended throughout his career. Graham failed to avoid it in the 1920s, leading to some dismal years for his fund during the Great Depression.\u00a0<\/p>\n Despite Green\u2019s modern investing strategies that are still relevant today, it is her thorny personality traits that have caught history\u2019s attention more than anything.<\/p>\n The investing legend was certainly frugal and not known for her kind nature. Newspapers made claims about her living in broken-down apartments; wearing cheap dresses until they ripped at the seams; and avoiding using hot water to save money\u2014all while she was a millionaire many times over. \u201cOne of the persistent stories is that her son Ned had to have his leg cut off because she was too cheap to get it treated,\u201d Slack noted.<\/p>\n But the biographer explained that this story really isn\u2019t true. Green did what she could to have her son\u2019s leg treated, despite her distrust for doctors\u2014she hated politicians, lawyers, and journalists, too. \u201cShe loved her son, and she tried a number of remedies over the years,\u201d Slack said. \u201cIt wasn\u2019t this sort of stark tale of cruelty we hear.\u201d\u00a0<\/p>\n The reality is, Green was often crass, cheap, and hard-headed, but despite all the stories about her cruel-hearted nature, she was also a brilliant investor, cunning businesswoman, and (mostly) loving mother who was decades ahead of her time.\u00a0<\/p>\n So why is she remembered only as the world\u2019s greatest miser?<\/p>\n \u201cI think men of that era, who are very successful in business, tend to get viewed first by their business genius, and later by their personal eccentricities. And I think for Hetty, because she was a woman, she tended to get viewed by her personal characteristics first of all, and her financial genius was an afterthought,\u201d Slack said.<\/p>\n Hetty herself argued that she was a victim of bad press. \u201cI am not a hard woman, but because I do not have a secretary to announce every kind act I perform, I am called close and mean and stingy,\u201d she once told reporters<\/a>, adding that: \u201cI am a Quaker, and I am trying to live up to the tenets of the faith. That is why I dress plainly and live quietly. No other kind of life would please me.\u201d<\/p>\n<\/div>\nUnderstanding the \u2018Witch of Wall Street\u2019<\/h2>\n