"Well, William, how much did you lose?"
"I went in at 110 on 10,000 shares. That ought to make me two hundred and sixty thousand dollars--"
"Very bad luck, William," quoth the father, trying to look extremely troubled,--"very bad luck, this time."
"But then I bought, and so made."
"Hey? What sent you doing that, sir?"
"O, I heard that was your line, and so concluded that you meant long instead of short."
"Ahem!" croaked Vanderbilt _pere_, as he b.u.t.toned up his fur overcoat, and stalked out of the open door. He has always had a high opinion of William since that event!
Some years ago Vanderbilt wanted to consolidate the Hudson River and Harlem Railroads, and when the scheme was presented before the Legislature of New York, secured a sufficient number of votes in that body to insure the pa.s.sage of the bill authorizing the consolidation.
Before the bill was called upon its final pa.s.sage, however, he learned from a trustworthy source that the members of the Legislature who had promised to vote for the bill, were determined to vote against it, with the hope of ruining him. The stock of the Harlem road was then selling very high, in consequence of the expected consolidation. The defeat of the bill would, of course, cause it to fall immediately. The unprincipled legislators at once began a shrewd game. They sold Harlem right and left, to be delivered at a future day, and found plenty of purchasers, every one but those in the plot expecting the consolidation of the roads and a consequent advance in the value of the stock. They let their friends into the secret, and there was soon a great deal of "selling short" in this stock. Commodore Vanderbilt managed to acquaint himself with the whole plot; but he held his peace, and resolved upon revenge. He went into the market quietly, with all the funds he could raise, and bought every certificate of Harlem stock that he could find.
These certificates he locked up in his safe. When the bill came before the Legislature on its final pa.s.sage, it was defeated.
The conspirators were jubilant. They were sure that the defeat of the bill would bring "Harlem" down with a rush. To their astonishment, however, "Harlem" did not fall. It remained stationary the first day, and then to their dismay rose steadily. Those to whom they had sold demanded the delivery of the stock, but the speculators found it impossible to buy it. There was none in the market at any price. In many of these instances Vanderbilt was the real claimant, the brokers acting in the transactions being merely his agents. Being unable to deliver the stock, the conspirators were forced to settle the demands against them in money, and the result was that they were ruined. One of the shrewdest operators in New York lost over $200,000. He refused to pay, and his name was stricken from the list of stockholders. This brought him to his senses, and he made good his contracts. Vanderbilt made money enough out of this transaction to pay for all the stock he owned in the Harlem Road.
Daniel Drew is a great operator. His gains are immense, as are also his losses. He is not popular in the street, and the brokers are fond of abusing him. He has handled too many of them mercilessly to have many friends. They say that he does not hesitate to sacrifice a friend to gain his ends, and that he is utterly without sympathy for those who go down before his heavy blows.
Bogus stock companies appear from time to time in Wall street. An office is rented and fitted up in magnificent style, a flaring programme is issued, and seemingly substantial evidences of the stability and prosperity of the company are exhibited to inquirers. The stock offered is readily taken up by the eager to be rich crowd. A dividend, most hopefully large, is declared and paid, to stimulate investments, and then, when the market has been drained dry, the bubble bursts, the directors disappear, the office is closed, and the shareholders lose their money.
On fine afternoons visitors to the Park do not fail to notice a handsome equipage driven by a stylish young man, with rosy cheeks and light curly hair. His face is the perfect picture of happy innocence. He is very wealthy, and owns a great deal of real estate in the city. The manner in which he made his money will show how other persons enrich themselves.
A few years ago, he, in company with several others, organized a scheme for working certain gold mines said to be located in a distant territory.
A company was made up, the country was flooded with flaming descriptions of the valuable mine, and stock was issued which sold readily. The bonds were soon taken up, and in a month or two the so-called company commenced paying handsome dividends. A number of gold bars, bearing the stamp of the mint, were on exhibition in the company"s office, and were triumphantly exhibited as amongst the first yields of the valuable mine.
For several months the dividends were paid regularly, and the company"s stock rose to a splendid premium. It could hardly be bought at any price. No one doubted for an instant the genuineness of the affair, and the lucky company was the envy of all Wall street.
In a few months, all the stock being disposed of, the company ceased paying dividends. This excited the suspicion of some of the shrewdest holders of the stock, and the affair was investigated. It was found that the wonderful mine had no real existence. The gold bars were simply gold coins melted into that form at the Mint, and stamped by the Government as so much bullion. The dividends had been paid out of money advanced by the company, who were simply half a dozen unprincipled sharpers. The stockholders were ruined, but the company made a profit of a clear half million of dollars out of the infamous transaction. Legal proceedings are expensive and tedious when inst.i.tuted against such parties, and the stockholders, rather than increase their losses by the outlay necessary for a lawsuit, suffered the swindlers to go unmolested.
A certain stock broker, anxious to increase his wealth, purchased twenty acres of land a few years ago in one of the Western States, and commenced boring for oil. After a few weeks spent in this work, he discovered to his dismay that there was not the slightest trace of oil on his land. He kept his own counsel, however, and paid the workmen to hold their tongues. About the same time it became rumored throughout New York that he had struck oil. He at once organized a company, and had a committee appointed to go West and examine the well. In a few weeks the committee returned in high glee, and reported that the well contained oil of the very best quality, and only needed capital and improved machinery to develop its capacity. In support of this a.s.sertion, they brought home numerous bottles containing specimens of the oil. This report settled the matter in Wall street, and the stock issued by the company was all sold at a handsome premium. When the sales ceased, it was rumored that the well had ceased to flow. This was true, for there was no oil anywhere on the land. That in the well had been bought in Pennsylvania, and poured into the well by the agents of the owner, and the examining committee had been paid large sums for their favorable report. The owner of the well was enriched, as were his confederates of the bogus company, and the holders of the stock were swindled, many of them being ruined.
Said the New York _Herald_, at a period when speculation was rampant:
"Within the past few days we have seen the most gigantic swindling operations carried on in Wall street that have as yet disgraced our financial centre. A great railway, one of the two that connect the West with the Atlantic seaboard, has been tossed about like a football, its real stockholders have seen their property abused by men to whom they have entrusted its interests, and who, in the betrayal of that trust, have committed crimes which in parallel cases on a smaller scale would have deservedly sent them to Sing Sing. If these parties go unwhipped of justice, then are we doing injustice in confining criminals in our State prisons for smaller crimes.
"To such a disgusting degree of depravity do we see these stock operations carried, that members of the church of high standing offer, when "concerned," to betray their brother "pals," and, in their forgetfulness of the morality to which they sanctimoniously listen every Sunday, state that "all they care about is to look out for number one."
A manager of a great corporation is requested to issue bonds of his company without authority, offering "to buy the bonds if you are caught, or buy the bonds with the understanding not to pay for them unless you are caught." This attempted fiscal operation, however, did not work, and resulted in a good proof of the old adage that it requires "a rogue to catch a rogue."
"A railroad treasurer boldly states that he has without authority over-issued stock of the company to a large amount. He offers it to a broker for sale, with the understanding that all received over a fixed value is to go into his (the treasurer"s) pocket. From the fact that this man is not arrested for maladministration of the company"s property, we judge this to be a legitimate operation, and that this may hereafter serve as a model or standard of morals to all presidents, directors, treasurers and managers of railway and other great corporations."
IX. BLACK FRIDAY.
In the month of September, 1869, one of the most gigantic attempts to run up the value of gold ever made was attempted by a powerful combination of Bulls, consisting of a set of unprincipled men whose only object was to make money. Their scheme came near attaining a success which would have broken the market utterly, have unsettled values of all kinds, and have precipitated upon the whole country a financial crisis of the most terrible proportions. Nothing but the interference of the Secretary of the Treasury at a critical moment averted this disaster. As it was, the losses were fearful. Men in Wall street were ruined by the score, and for several days the best houses in the street were uncertain as to their exact condition.
An account of this formidable transaction is interesting as revealing the method of conducting the great operations of the street.
[Picture: SCENE IN THE GOLD ROOM--BLACK FRIDAY.]
"On the 22d of September, 1869, gold stood at 137.5 when Trinity bells rang out the hour of twelve. By two it was at 139. Before night its lowest quotation was 141. . . . An advance of three and a half per cent.
in five hours. At the same time the Stock Market exhibited tokens of excessive febrility, New York Central dropping twenty-three per cent. and Harlem thirteen. Loans had become extremely difficult to negotiate. The most usurious prices for a twenty-four hours" turn were freely paid. The storm was palpably reaching the proportions of a tempest.
"Nevertheless, the brokers on the Bear side strove manfully under their burden. The character and purposes of the clique were fully known.
Whatever of mystery had heretofore enfolded them was now boldly thrown aside, and the men of Erie, with the sublime Fisk in the forefront of the a.s.sailing column, a.s.sured the shorts that they could not settle too quickly, since it remained with the ring, now holding calls for one hundred millions, either to kindly compromise at 150 or to carry the metal to 200 and nail it there. This threat was accompanied by consequences in which the mailed hand revealed itself under the silken glove. The movement had intertwisted itself deep into the affairs of every dealer in the street, and entangled in its meshes vast numbers of outside speculators. In borrowing or in margins the entire capital of the former had been nearly absorbed, while some five millions had been deposited by the latter with their brokers in answer to repeated calls.
When Thursday morning rose, gold started at 141-5/8, and soon shot up to 144. Then the clique began to tighten the screws. The shorts received peremptory orders to increase their borrowing margins. At the same moment the terms of loans overnight were raised beyond the pitch of ordinary human endurance. Stories were insidiously circulated exciting suspicion of the integrity of the Administration, and strengthening the belief that the National Treasury would bring no help to the wounded Bears. Whispers of an impending lock-up of money were prevalent; and the fact, then shrewdly suspected, and now known, of certifications of checks to the amount of twenty-five millions by one bank alone on that day, lent color to the rumor. Many brokers lost courage, and settled instantly.
The Gold Room shook with the conflict, and the battle prolonged itself into a midnight session at the Fifth Avenue Hotel. The din of the tumult had penetrated to the upper chambers of journalism. Reporters were on the alert. The great dailies magnified the struggle, and the a.s.sociated Press spread intelligence of the excitement to remote sections. When Friday opened clear and calm, the pavement of Broad and New streets soon filled up with unwonted visitors. All the idle population of the city and its neighborhood crowded into the financial quarter to witness the throes of the tortured shorts. Blended with the merely curious were hundreds of outside speculators who had ventured their all in the great stake, and trembled in doubt of the honor of their dealers. Long before 9 A.M. these men, intensely interested in the day"s encounter, poured through the alley-way from Broad street, and between the narrow walls of New street, surging up around the doorways, and piling themselves densely and painfully within the cramped galleries of the Room itself. They had made good the fresh calls for margins up to 143, the closing figure of the night before. The paramount question now was, How would gold open?
They had not many minutes to wait. Pressing up to the fountain, around which some fifty brokers had already congregated, a Bull operator with resonant voice bid 145 for twenty thousand. The shout startled the galleries. Their margins were once more in jeopardy. Would their brokers remain firm? It was a terrible moment. The Bears closed round the aggressors. Yells and shrieks filled the air. A confused and baffling whirl of sounds ensued, in which all sorts of fractional bids and offers mingled, till "46 emerged from the chaos. The crowd within the arena increased rapidly in numbers. The clique agents became vociferous. Gold steadily pushed forward in its perilous upward movement from "46 to "47, thence to "49, and, pausing for a brief twenty minutes, dashed on to 150.5. It was now considerably past the hour of regular session. The President was in the chair. The Secretary"s pen was bounding over his registry book. The floor of the Gold Room was covered with 300 agitated dealers and operators, shouting, heaving in ma.s.ses against and around the iron railing of the fountain, falling back upon the approaches of the committee-rooms and the outer entrance, guarded with rigorous care by st.u.r.dy door-keepers. Many of the princ.i.p.al brokers of the street were there,--Kimber, who had turned traitor to the ring; Colgate, the Baptist; Clews, a veteran government broker; one of the Marvins; James Brown; Albert Speyer, and dozens of others hardly less famous. Every individual of all that seething throng had a personal stake beyond, and, in natural human estimate, a thousand-fold more dear than that of any outside patron, no matter how deeply or ruinously that patron might be involved. At 11 of the dial gold was 150.5; in six minutes it jumped to 155. Then the pent-up tiger spirit burst from control. The arena rocked as the Coliseum may have rocked when the gates of the wild beasts were thrown open, and with wails and shrieks the captives of the empire sprang to merciless encounter with the ravenous demons of the desert. The storm of voices lost human semblance.
Clenched hands, livid faces, pallid foreheads on which beads of cold sweat told of the interior anguish, lurid, pa.s.sion-fired eyes,--all the symptoms of a fever which at any moment might become frenzy were there.
The shouts of golden millions upon millions hurtled in all ears. The labor of years was disappearing and reappearing in the wave line of advancing and receding prices. With fortunes melting away in a second, with five hundred millions of gold in process of sale or purchase, with the terror of yet higher prices, and the exultation which came and went with the whispers of fresh men entering from Broad street bearing confused rumors of the probable interposition of the Government, it is not hard to understand how reason faltered on its throne, and operators became reckless, buying or selling without thought of the morrow or consciousness of the present. Then came the terrific bid of Albert Speyer for any number of millions at 160. William Parks sold instantly two millions and a half in one lot. Yet the bids so far from yielding rose to 161, 162, 162.5. For five minutes the Board reeled under the ferocity of the attack. Seconds became hours. The agony of Wellington awaiting Blucher was in the souls of the Bears. Then a broker, reported to be acting for Baring & Brothers, at London, sold five millions to the clique at the top price of the day. Hallgarten followed; and as the shorts were gathering courage, the certain news that the Secretary of the Treasury had come to the rescue swept through the chamber, gold fell from 160 to 140, and thence, with hardly the interval of one quotation, to 133. The end had come, and the exhausted operators streamed out of the stifling hall into the fresh air of the street. To them, however, came no peace. In some offices customers by dozens, whose margins were irrevocably burnt away in the smelting-furnace of the Gold Board, confronted their dealers with taunts and threats of violence for their treachery. In others the nucleus of mobs began to form, and, as the day wore off, Broad street had the aspect of a riot. Huge ma.s.ses of men gathered before the doorway of Smith, Gould, Martin & Co., and Heath & Co. Fisk was a.s.saulted, and his life threatened. Deputy-sheriffs and police officers appeared on the scene. In Brooklyn a company of troops were held in readiness to march upon Wall street.
"When night came, Broad street and its vicinity saw an unwonted sight.
The silence and the darkness which ever rests over the lower city after seven of the evening, was broken by the blaze of gas-light from a hundred windows, and the footfall of clerks hurrying from a hasty repast back to their desks. Until long after Trinity bells pealed out the dawn of a new day, men bent over their books, scrutinized the Clearing-House statement for the morrow, took what thought was possible for the future. At the Gold Exchange Bank the weary accountants were making ineffective efforts to complete Thursday"s business. That toilful midnight, at the close of the last great pa.s.sion-day of the bullion-worshippers, will be ever memorable for its anxieties and unsatisfying anguish.
[Picture: BROAD STREET ON BLACK FRIDAY.]
"Sat.u.r.day brought no relief. The Gold Board met only to adjourn, as the Clearing-House had been incapable of the task of settling its accounts, complicated as they were by ever fresh failures. The small brokers had gone under by scores. The rumors of the impending suspension of some of the largest houses of the street gave fresh grounds for fear. The Stock Exchange was now the centre of attraction. If that yielded, all was lost. To sustain the market was vital. But whence was the saving power to came? All through yesterday shares had been falling headlong. New York Central careened to 148, and then recovered to 185.75. Hudson plunged from 173 to 145. Pittsburgh fell to 68. Northwest reached 62.5.
The shrinkage throughout all securities had been not less than thirty millions. Would the impulse downward continue? The throngs which filled the corridors and overhung the stairway from which one can look down upon the Long Room saw only mad tumult, heard only the roar of the biddings.
For any certain knowledge they might have been in Alaska. But the financial public in the quiet of their offices, and nervously scrutinizing the prices reeled off from the automaton telegraph, saw that Vanderbilt was supporting the New York stocks, and that the weakness in other shares was not sufficient to shadow forth panic. It soon became known that the capitalists from Philadelphia, Boston, and the great Western cities had thrown themselves into the breach, and were earning fortunes for themselves as well as grat.i.tude from the money-market, by the judicious daring of their purchases. The consciousness of this new element was quieting, but Wall street was still too feverish to be reposed by any ordinary anodyne. A run on the Tenth National Bank had commenced, and all day long a steady line of dealers filed up to the counter of the paying teller demanding their balances. The courage and the ability in withstanding the attack which were shown by the president and his a.s.sociates deserve something more than praise. The Gold Exchange Bank witnessed a similar scene, angry brokers a.s.saulting the clerks and threatening all possible things unless instantaneous settlements were made. The freedom with which the press had given details of the explosion had been extremely hurtful to the credit of many of the best houses. In a crisis like that of Black Friday the sluice-gates of pa.s.sion open. Cloaked in the masquerade of genuine distrust, came forth whispers whose only origin was in ancient enmities, long-treasured spites, the soundless depths of unquenchable malignities. Firms of staunchest reputation felt the rapier-stroke of old angers. The knowledge that certain houses were large holders of particular stocks was the signal of attacks upon the shares. Despite of outside orders for vast amounts, these influences had their effect upon securities, and aided to tighten the loan market. One, one and a half, two, and even four per cent. were the compulsory terms on which money could alone be borrowed to carry stocks over Sunday.
"On Monday the 27th the Gold Board met, but only to be informed that the Clearing-House was not yet ready to complete the work of Friday.
Important accounts had been kept back, and the dealings, swollen in sum-total to five hundred millions, were beyond the capacity of the clerical force of the Gold Bank to grapple with. A resolution was brought forward proposing the resumption of operations Ex-Clearing-House.
The measure took the members by surprise, for a moment quivered between acceptance and rejection, and then was swiftly tabled. It was an immense Bear scheme, for no exchange can transact business where its dealers are under suspicion. All outstanding accounts require immediate fulfilment.
Failure to make good deliveries would have insured the instant selling out of defaulters "under the rule." As the majority of brokers were inextricably involved in the late difficulty, the only consequence would have been to throw them into bankruptcy, thus bringing some $60,000,000 under the hammer. The market could not have borne up under such an avalanche. It was decided that the Room should be kept open for borrowings and loans, but that all dealings should be suspended. One result of this complication was that gold had no fixed value. It could be bought at one house for 133 and at other offices sold for 139. The Board thus proved its utility at the very juncture when least in favor."
XVI. THE FERRIES.
Including the Harlem, Staten Island, and Elizabethport routes, there are about twenty-five lines of ferries plying between New York and the adjacent sh.o.r.es. Ten of these lines are to Brooklyn, two to Hunter"s Point, two to Green Point, one to Mott Haven, and one to Harlem, all in the East River; and five to Jersey City, one to Weehawken, one to Fort Lee, two to Staten Island, and one to Elizabethport, all in the North River. Thus there are sixteen lines in the East River, and ten in the North River. The boats are large side-wheel vessels, capable of carrying pedestrians, horses and vehicles. The fare to the Jersey sh.o.r.e is three cents, to Brooklyn two, and to Harlem and Staten Island ten cents. On some of the lines the boats ply every five minutes; on others the intervals are longer. The Staten Island and Harlem boats start every hour.
The boats are generally handsome, as well as large. Nearly all are lighted with gas, and at least a score of them are to be seen in the stream at any time. At night, with their many colored lamps, they give to the river quite a gala appearance. The Fulton, Barclay, and Courtlandt street lines run their boats all night. The others run from 4 A.M. until midnight. The travel on the various lines is immense. The aggregate is said, by reliable authority, to be upwards of 200,000 persons per day, or about 75,000,000 per annum. Many of the boats carry from 800 to 1000 pa.s.sengers at a single trip.
During the summer it is pleasant enough to cross either of the rivers which encircle the island, but in the winter such travelling is very dangerous. Storms of snow, fogs, and floating ice interfere very greatly with the running of the boats, and render accidents imminent. Collisions are frequent during rough or thick weather, and the ice sometimes sweeps the boats for miles out of their course. The East River is always more or less crowded with vessels of all kinds, either in motion or at anchor, and even in fair weather it requires the greatest skill on the part of the pilot to avoid collisions.
Tens of thousands of people enter and leave the great city daily by means of the ferries. The country for twenty miles around the city is built up by persons who earn their bread in New York, and morning and evening they pa.s.s between their places of business and their homes. You may recognize them as they come into the city in the morning, or as they leave it at the close of the day. Towards five o"clock vast swarms of working-men pour over the river, followed at six and seven by the factory and shop girls, the clerks and salesmen in the retail houses and offices, and from these the newsboys reap a harvest for the two-penny papers. Every one has his newspaper, and all who can find the necessary s.p.a.ce on the ferry-boat economize their time by reading the news as they cross the river. Later still come the clerks in the wholesale houses, and later still the great merchants themselves. Between nine and ten the Wall street men put in an appearance, and later yet the great capitalists, residing out of the city, begin to show themselves. From eight o"clock the great dailies are in demand, and the newsboys have scarcely a call for the cheap papers. Towards noon the idlers and ladies bent on shopping expeditions cross over, and for a few hours the ferries are comparatively dull. Towards four o"clock in the afternoon, however, the tide flows back again, but in reverse order. The richest come first, for their working hours are short, and the poorest extend the crowd into the hours of darkness. Night brings another flow and ebb of pleasure-seekers, theatre-goers, etc., so that the midnight boats go almost as full as those of the early evening. Then a few stragglers avail themselves of the boats that ply between midnight and morning.
They are mostly journalists, actors, or printers employed in the newspaper offices.
With the first light of dawn, and frequently long before the darkness has pa.s.sed away, the market farmers and gardeners of Long Island and New Jersey crowd the boats with their huge wagons heavily loaded with vegetables and fruits for the city markets. They come in throngs, and the approaches to the ferries in Brooklyn and Jersey City are lined for blocks with their wagons. They are mostly Germans, but they show a decidedly American quality in the impatience they manifest at the delays to which they are subjected. On the lower Jersey ferries, they are often followed by droves of cattle, many of which have come from the Far West, all wending their way to the slaughter houses of New York.
The New York approaches to the ferries are always "jammed" with wagons and trucks. The luckless "foot-pa.s.senger" must take the chances of reaching the boat in time, and often must incur no little risk in making his way through the crowd of vehicles. The police try hard to keep these approaches free, but the throng is too great for them, and they have all they can do in seeing after the safety of the "foot-pa.s.sengers." A man on foot has no rights that a New York driver is bound to respect, and Jehu thinks it no harm to run over any one who gets in his way.
The ferries are good places to study human nature, for all cla.s.ses use them. You see here the poor, pale working girl, whom toil and poverty are making prematurely old, and the blooming lady of fashion; the beggar and the millionaire; the honest laborer and the thief; the virtuous mother and her children, and the brazen courtezan and her poodle dog.