The sun. [volume] (New York [N.Y.]) 1833-1916, 1878-06-23
THE GREAT sTOCK RISE or 1917.
How Ncnr james II. Keene Game 90 being
RuIned-Jny Gomld his Dclircrer.

''''No NN'''' ~ ~ wv AVN Apih bAOsh LA
change aggregaiing moro than one hundred
ana twenty-five millions OF dollars. In many
instances stocks have doubled. ucbcd. and even
quadrupled in price There seems to be eon-
eral Impression that this great recuperation has
has bccn duo to buylng OF stocks by the outside
public Tor investment. based upon improvement
In business. largo crops and the prospect OF
European wnr involving all oi the great powers
III is undoubtedly true That there has been
certain Improvement in the general business oil
the country; the crops Of 1877. approximately
large. have found market at high figures
great deal Of ready money from abroad has
been secured by the producing classes. and the
railroads have been able to Increase their earn
ings by the transportation OF grain TO the sea-
board. There is also an increased acreage the
present year. and trade prospects are brighter.
So far ~ the stock market is concerned. how
ever. 1t is not best to be too sanguine until 1t APP
pears that tho great advance In prices Is due to
well distributed buying upon actual increase In
net earnings. In order To discover how mueh
OF the present buoyancy Is due TO investment
orders and not to the manipulation OF probes
| sional operators OF immense wealth. II If noces-
sary to 70 back TO the beginning OF the great
riac, and unfold its history.
The panic OF 1873 Disguised the general pub
lie with stock speculation. and. in the absence Of
! outside buying, Wall street became the abode Of
bears. Prior 10 this shock to business. the ma
! iority OF operators were bulls aferward they
became bears
The most prominent supporter Of prices used
to be Commodore Vanderbilt. His failing health
| kept him from active operations in Wall street
during tho years Of greatest depression sue
ceedng the panic. and smaller operators were
given free swing In the stock market. There
seemed TO be no men OF groat wealth in Wall
street disposed TO mako an active bull cam
pagn. Jay Gould. tied ny with Union Pacific.
did little except manipulate mn occasional rise
or fall In Western Union. Wall street lacked
great gamblers. and waited for fresh influx Of
| speculative capital In the winter Of 1876.
James II. Keene made his appearance from Cal
| iiornia. bringing from sj.OO0.OOO 10 $1,000 600
Of ready money. His influence began to be- felt
in the street soon after his arrival. At first his
operations were ON the bull side. He soon aban-
dOncd these tactics and Joined forces with Jay
| Gould in n bear attack upon Western Union and
Lake Shore. Not many months after his arrival
| Commodore Vanderbilt died, and his immense
fortune was loft mostly in the hands OF William
| H. Vanderbilt who soon began to use il In stock
| speculation. Wall street suddenly found itself
! blessed with two great spectators OF sufficient
capital to support it for many years.
Everybody was on the qii rire to find out
| WnNtner Mr. NunueInllt would buy sell. and
the waves Of speculation rosa and fell as tho
popular impression varied The first move Of
| Nr Vanderbilt came 10 lisht in the spring of
| 1877 when he bought largely OF Michigan Cen
trail. but was beaten hy the Noses TAYLOR clique
| in thu contest for the control The financial
horizon grew cloudy. with large nunll,ers Of
failures and raports Of imnendinp railroad
strikes Jay Gould WAS busllv engaged in de-
uressine Western Union bv low.rinc nj rates
on the Atlantic and Pacin, Telegraph. Invest.
ora evervwhers wern frightened out NJ their
stocks. and the lowest figures eyer known
ruled at the Stock Exchange. All of Mr.. VAN
derbilt's properties ,yerc s.riously affected md
his vast fortune WINS cut down many millions bv
Tho general depreciation. The Twentv.third
street oparators first anneareI ms buvers of
stocks and sustained pricos for n time Their
Courage gave ont however. md pricos fell sey.
eral per cent. leaving them holding large lines
| OF stocks al n heavy loss
In June james H. Keene began to buy stocks
/ and il seemed as ifa decided rally was about to
take place Indeed a general advance occurred
and the outlook WIS promising for a bull move
ment In July the great strike began and an
immense pressure OF stocks again carried down
quotations. James II. Kecne was the principal
buyer and a. the marke, fell lie bought moro.
He. M well ~ everybody else. had no idea that
tons. and il came 10 pass that on the night OF
July "A. with load OF stocks. estimated at from
two hundred and Nifty thousand to live hundred
thousand shares. he sought Jay Could with
whom he WIS then at loggcrhe adsi. aud formed
n combination to sustain prices. Mr. Gould was
/ heavily short Of Lake Shore. and he consented
To buy enough Of Mr.. Kernr's stock to cover his
shorts. At a concession from tho market. Mr.
Gould took enough OF other stocks as we'll ex-
cept 81. Paul preferred.
As il happened. Mr.. Koene was short Of
Western Union, and supposed that Mr.. Gould
was in tho same position. owing to thcir Joint
attacks upon that corporation. II WAS agreed
that everything except Western Union should
be taken care Of and bullcd Western Union
was to be broken down to 40 and then bought
| for Joint account Mr.. Gould's position was
somewhat different. BY u secret arrangement
made with Mr.. Vanderbilt some time before. he
had bought nearly all OF the Western Union in
the market in company with that gentleman.
He was. therefore, in a position to buy for the
long account. except in 81. Paul preferred. and
naturally favored a bull movement keene was
long Of everything except Western Union. and
ali, fluf ltu i'm. ut.an NJ