Making It : FOUNDER: A Portrait of the First Rothschild and His Time.<i> By Amos Elon (Viking: $24.95, 208 pp.)</i>

If you think these are trying times, read this book.

“Founder” is a biography of a time and place as much as of a man. The time, the latter 18th century, and the place a single street in the growing city of Frankfurt, Germany.

The street was called the Judengasse, or Jews’ Alley, “a narrow lane, more slum-like and overcrowded than any other in Frankfurt,” author Amos Elon writes. “A closed compound, it was shut off from the rest of the city by high walls and three heavy gates. The gates were guarded by soldiers and were locked at night, all day on Sundays and Christian holidays and from Good Friday until Easter.”

On that street, made darker by a wall to prevent Jews from looking into Christian houses, lived 3,000 of Frankfurt’s 32,000 people, the largest Jewish community in Germany. And on that street, Meyer Amschel Rothschild was born in 1744 and lived his life.

Rothschild was to start in business by supplying rare coins to noblemen, who collected them as what we might call inflation hedges. He went on to become foreign exchange banker to the richest man in Europe and, with his five sons, to create one of the most renowned banking companies in the world. The family would finance the Duke of Wellington, enabling him ultimately to defeat Napoleon. The heart of this story is the way Meyer Amschel Rothschild and his wife, Guttle, raised 10 children in a house 14 feet wide by 38 feet long. It’s the story of how he made his way in the world, even though a member of a restricted--nay a suppressed--minority.

But the book is more than a biography; the author does not attempt to imagine the thinking of a man who lived two centuries ago. In laying out an atmosphere in which discrimination was part of everyday life, Elon tells a cautionary tale about the depths to which institutional prejudice can reduce a society.

That Rothschild could build a business at all may seem a wonder. It helped that there was no unified Germany in the 18th century but rather a cluster of more than 100 states, each issuing its own currency. This meant that money changing was a profitable trade if one had reliable information from correspondents abroad. Jewish families with relatives scattered across Europe had an edge in this trade, Elon writes. It was an early instance of the value of information in international finance.

Rothschild’s first big break came as a result of the Hessians, the troops who--as every American schoolchild learns--came as mercenaries to fight against England’s American colonists in the Revolutionary War. But the poor troops were not really “mercenaries”; they didn’t get paid for being cannon fodder. Their services were simply sold to the English King George III by his cousin, Wilhelm, count of Hesse. King George paid Wilhelm millions, making him the richest man in Europe. And all those English pounds and notes had to be converted into local currency.

Along with prominent Christian bankers, Rothschild got some of that conversion business despite daily indignities in the streets of Frankfurt where he had to remove his hat and bow to any lout who commanded him to. This was the cultured city where the poet Goethe grew up in the same years as Rothschild, in considerably better circumstances.

After American independence came the French Revolution and the empire of Napoleon, whose conquests in Europe included Frankfurt. Napoleon represented a fresh wind in Europe, sweeping away old power structures and encouraging civic emancipation of the Jews.

In Frankfurt’s case, the community of the Judengasse paid the city the equivalent of $3 million in today’s money for the rights of Jewish citizens to buy houses outside the ghetto and to walk in the parks on Sunday. Rothschild negotiated that deal and put up one-fourth of the money.

Napoleon’s decade or so of rule in Europe had other effects on Rothschild fortunes. His blockade to bar English goods from the Continent set off a tremendous demand for all things English. So Nathan Rothschild, perhaps the smartest of the sons, set up business in England to ship goods to the Continent, where his brothers received and distributed them on the black market. The brothers later formed the five banking houses of Rothschild--Nathan in London, James in Paris, Amschel in Frankfurt, Salomon in Vienna and Calmann in Naples. The House of Rothschild helped finance the industrial revolution and democracy’s spread in 19th century Europe, arousing great admiration--as well as resentment that lived on.

The poet Heinrich Heine praised the Rothschilds as “destroyers of aristocratic privilege” in terms that author Elon, a prominent Israeli writer, notes with foreboding were overdone in the 19th century. Such praise, said Elon, laid an unfortunate groundwork for “lethal insinuations” of a worldwide conspiracy of Jewish bankers in the 20th century, which formed part of the climate of hatred against Jews.

But Elon does not write about the great period when the Rothschilds bestrode European finance. Rather he looks back to the strength in adversity that produced that later success. His story is of a simple but ambitious man, who studied rare coins because that was a business open to him and his kind. Meyer Amschel Rothschild worked diligently to build a business and raise a family in conditions most Americans today would find beyond their endurance.

Elon reports Rothschild’s life and the fact that on Yom Kippur, the Jewish Day of Atonement, Sept. 16, 1812, at age 68, having suffered for years an undiagnosed infection in his leg, “Rothschild walked to the synagogue early in the morning. He spent the day there, mostly on his feet and fell ill that night.” Three days later he died and was buried as a hero by the community of the Judengasse.