Spring 2014

Emotional Investment

Marcel Proust’s Mexican stocks

Rubén Gallo

Marcel Proust learned most of what he knew about Latin American history and politics from a most unusual source: the stock market.1 After the death of his parents—Madame Proust died in 1905, two years after Dr. Adrien Proust—Marcel inherited a considerable fortune that was invested in blue-chip stocks and bonds and was managed by Léon Neuburger, a family friend who worked for the Rothschild Bank. When the novelist began purchasing exotic financial products, Neuburger asked his nephew Lionel Hauser, who was close to Proust and almost the same age, to take charge of his friend’s portfolio.

Starting in 1906 and continuing though 1921, Proust wrote frequent and elaborate letters to Hauser—sometimes several a day. These missives conveyed instructions to buy and sell stock, asked advice about possible investments, and often veered into extended meditations on life, politics, and literature. Proust seems to have treated Hauser not only as a financial advisor, but also as a psychoanalyst and a guru of sorts: he seems to have been under the naive impression that his friend, given his line of work, could perfectly predict the rise and fall of securities and the general tendency of the world economy. And, since the two had met as children, he was one of the rare people whom Proust addressed using the informal tu rather than the formal vous.

Hauser, for his part, was no ordinary broker. He was the scion of an illustrious banking family—several relatives worked for the Rothschild Bank—and he had a passion for literature, philosophy, and the arts. His letters to Proust include long discussions of operas, novels, poems, and paintings. More intriguingly, Hauser was a theosophist, and some of his financial advice is intermingled with meditations on the vicissitudes of karma and the effects of greed on the chain of reincarnation. In 1920, he wrote a book summarizing his views: The Three Levers of the New World: Competence, Probity, Altruism, published by the London Theosophical Publishing House, called for the creation of a “league” of ethical professionals (“the member of the League who is a banker,” he wrote, “must regard the interests of his clients as his own and never suggest an investment to them which he would consider too risky for himself.”)2 He sent Proust a copy, and a lively debate ensued as the two friends discussed the best way to live an ethical life.

As an investor, Proust had a special interest in exotic securities. His purchases—or at least intended purchases—included bonds issued by Holland, Spain, Serbia, Egypt, Turkey, Tunisia, Chile, Argentina, and the United States; railway stock in Switzerland, Argentina, Brazil, and Tunisia, as well as in Pennsylvania and Kentucky; gold, nickel, and diamond mines, including those exploited by De Beers; oil and shipping companies from around the world; as well as other more random securities, such as shares in Société de l’Azote (a nitrogen producer), Société Pop (a firm specializing in compressed air), Malacca Rubber (a company based in Malaysia), and a Russian venture called Oriental Carpet.

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