Loeb, Rhoades

Loeb, Rhoades & Co. was a Wall Street brokerage firm founded in 1931 and acquired in 1979 by Sanford I. Weill's Shearson Hayden Stone to form Shearson/American Express father Carl M. Loeb and son John Langeloth Loeb Sr. in 1931, shortly after the onset of the Great Depression. Carl M. Loeb & Co. merged with Rhoades & Company, a white shoe Wall Street brokerage firm, in 1937 to form what became Loeb, Rhoades & Co. Rhoades & Company had been founded in 1905 by John Harsen Rhoades Jr. (born 1869), formerly a partner of Rhoades & Richmond. The firm operated under the Loeb, Rhoades name from 1937 through 1979 when it briefly used the name Shearson Loeb Rhoades, for two years prior to its acquisition by American Express in 1981.

Carl Loeb, who had built his personal wealth as president of American Metal Company resigned from the company and bought a seat on the New York Stock Exchange, at the urging of his son John in 1931. While on the New York Stock Exchange, he pushed through many reforms. Three years after Loeb left American Metals, the company's stock was nearly worthless. Together with his son, Carl ran Loeb, Rhoades for its first 24 years, from 1931 until his death in 1955. John L. Loeb was a partner in the firm from 1931 to 1955 and following the death of his father became the senior partner, a role which he retained through 1977 when the firm was merged. In 1951, John Loeb became a governor of the New York Stock Exchange. In 1956, Loeb, Rhoades acquired a controlling interest in the Cuban Atlantic Sugar Company and sold its stake on December 31, 1958, a day before the Cuban Revolution.

In 1973, Carl M. Mueller assumed management control of the firm before Loeb resumed his management responsibilities in the firm in 1977. Loeb oversaw the merger of Loeb, Rhoades with Hornblower, Weeks, Noyes & Trask to form Loeb, Rhoades, Hornblower & Co. in January 1978 before handing over day to day control of the firm to his nephew, Thomas Kempner, a grandson of Carl Loeb who had joined the firm in 1950.

The Hornblower merger turned out to be disastrous for Loeb, Rhoades. The two firms incurred significant costs attempting to merge their back office operations, both of which had issues prior to the merger. By the end of 1978, less than a year after the merger, the combined firm was losing millions of dollars. Through the 1960s and 1970s, Sanford I. Weill was acquiring brokerage firms and by 1979 was running Shearson Hayden Stone