The Wheeling daily intelligencer. [volume] (Wheeling, W. Va.) 1865-1903, 1873-12-31
How Jay Cooke & Co. Came TO Fail.


The New York Tribune Of Monday
contains a letter from Philadelphia that
gives the latest and probably the most
reliable neWs in regard to the assets Of
this house, and also the most satisfactory
explanation we, have seen In regard to
It's failure. The writer says that public
opinion In financial circles In that city
has settled upon 90 cents on the dollar as
the Squire that tho whole estate will
probably pay to creditors, provided It Is
wound up within year under the pro.
visions of the bankrupt law. II a longer
time Is allowed, and II q rebound should
occur from the present depression in
Northern Pacific securities, the house
will pay iconnderably more. Some small
transactions in Northern Pacific bonds
were reported few days ago to have
been made on the stock market at 20 and
29i, but these are suspected not to have
been genuine sales Many Of the large
creditors arc opposed 10 the immediate
sale Of the bonds and other obligations Of
tho road held by. the firm, on tho ground
that nearly the entire amount would be
sacrificed.
The firm had a big thing In view in
handling the Northern Pacific bonds, and
II they had succeeded would have made
= mint Of money According to the
writer in the Tribune they received these
bonds at lightweight cents on the dollar
and sold them at par:
al they had succeeded In disposing Of
the whole loan before the panic came,
they would gave made q colossal fortune
from the transaction. As 1t was, they
need not have suffered by the want Of con.
fldence felt by the public In the success Of
the enterprise, II they had confined their
connection with 1t 10 an agency business
and had not supported II with their own
money and that Of their depositors. But
their enthusiastic faith In the undertaking
led them to embark more and more In il,
and then when ruin threatened 1t they put
still more In it 10 save what they had be-
fore invested, apd 30 It went on until the
final collapse. To sell the bonds II was
necessary 10 push forward the building OF
OF the road and arouse popular enthusi.
asm about its rapid progress. The bond
sales did not yield funds enough 10 do this,
so Jay Cooke Go. advanced their
own money first and then the
money OF other people intrustel 10
their keeping and took the railroad bonds
as security. After while the confidence
OF the public In the road began 10 abate
instead Of increase. Personal friends Of
tho firm who had been persuaded into
purchasing the bonds wanted 10 get rid
Of them, and the firm, TO demonstrate their
continued faith In the enterprise, had to
buy them back. Other people threatened
TO throw their bonds upon upon the mar.
ket, which would assuredly have stopped
any further sales at par. Some Of these
the firm bought, and TO some OF tho hold
ers they lent money, taking the bonds as
collaterals. To what extent they repur.
chased bonds cannot be ascertained. but
among their assets appear over $2OOOOO
held as collaterals Tor loans. OF which
$4,000 went to former official OF the
House Of Representatives generally re.
puted 10 have given great assistance In
lobbying the land grant for the road
through Congress. From the day when
the firm began to buy back the bonds aud
make loans upon them their doom was
certain. Their subsequent effort 10 save
themselves was only rowing up stream
while the current was carrying them
steadily and swiftly into the whirlpool OF
bankruptcy. 4, ~.