Baron Rothschild: Banker Third Man

Posted by admin on Wednesday, April 13, 2022

Baron Rothschild Money Quote saying bankers convince a third-party to lend customers money. Baron Rothschild said:
 

 

“A banker is a man who lends another man the money of a third man” — Baron Rothschild

 

 

In this quote, Baron Rothschild is concisely defining the role and business of bankers. The best interpretation is that he is pointing out that a core function of bankers is to act as intermediaries that connect lenders and borrowers.

Specifically, Rothschild notes that bankers lend money to one party (the borrower), but the source of those funds is actually third parties (savers and other investors) who have deposited money with the bank.

So in essence, Rothschild is capturing how bankers bring together the capital of one group of people (those providing the deposits and funds) to be lent out to another group (those in need of loans). This intermediation between lenders and borrowers is central to how banking works.

Overall, the quote presents banking as the business of channeling money from one set of hands to another for a fee or interest income, rather than banks generating funds solely from their own balances sheets. It succinctly defines their core role in financial markets.

Birthday: September 16, 1777 – Death July 28, 1836

Categories: finance