The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1893-05-28
GAMBLING ON A LARGE SCALE.

Thoughtful people in the East, reviewing
the recent decline and fall in industrial
stocks, are reviving the old controversy over
the responsibility of Wall street for such
catastrophes. 1t is said that people would
not have lost their money in cOrdage stock
but for the Endorsement which it received
by being placed on the list of the Stock
Exchange, and the same remark will apply
to other industrial shares which have not
yet collapsed, but which are worth much
less money than they were. And the old re-
mark IS made that by opening mart where
such commodities are dealt in the Stock
Exchange places itself on the same plane
as gambling-h0use in which the unwary
are invited to lose their coin. The late
Rufus hatch, who IN his lifetime had been
a conspicuous leader in Wall street. ex-
pressed some such views in his advice to
his sons: he warned them against gambling
either in the exchange or over the green
cloth-making no distinction between the
two.
When old John Good declared that he
could not see how the cordage trust could
make money at the current prices of rope
and hemp. he was told that the promoters
reckoned to make their profit out of the
fuetuation in their stock, and not out OF
the sales of their wares. In other words,
they proposed to open a new game in the
gambling-h house in Broad street. and to
fleece outsiders who put up their money
herein. There is but one form OF words
to characterize place where sucn dolngs
are carried on. When knave opens faro
game and permits gentlemen to stake their
money thereat the police are down on him
directly. and he has to pay the usual BLACK
mail to save his place from being period
ically pulled; but when a party OF tinan-
ciers open precisely similar game on
larger scale, and offer young men Of means
an opportunity to be fleeced by the bulls
and the bears, no one interferes with them,
and they take high rank in society.
The whole stock-gambling business in
New York as in San Francisco is con-
Quoted in defiance of law. There as here
time contracts are void, but the stock eX-
changes enforce them by depriving de-
faulters of the means of carrying on their
business. There as here the declaration of
dividends out of any source other than
earnings is misdemeanor, but the cordage
trust paid regular dividends out of capital.
and the same thing has been done here
time out of mind by mining companies.
The law in both cases is dead letter. No
prosecution is ever instituted for the pun
ishment of the misdemeanOr. and the
stock exchanges are never restrained from
saspending a member who defaults on his
time contracts. The notification of law
is defended on the plea that the laws
against time contracts and unwarrauted
dividends are examples of unjustifable in
...;.t Dr. l.
question in morals that the declaration of
an unearned dividend is fraud upon the
public, and that the custom of time sales
facilitates gambling.
If there were no place where securities
could be bought and sold inconvenience
would arise. But il is not at all necessary
that such place should be converted into
a gambling where knaves can take
the money of simple-minded men on false
pretenses. The aim of the promo of
the cOrdage trust was to sell their shares,
which had been inflated to high price by
the declaration of dividends that had not
been earned. That was fraudulent aim.
ana ought to arouse the attention of the
District Attorney. All old stagers
who entered into pools to boom
cordage-probably with a full knowl-
edge of the facts-were accomplices
in the fraud. Expressions of sympathy for
houses which failed are found in the
papers. The sympathy is misplaced. No
one who suffered in the catastrophe is en-
titled to com miBeration. The greenhorns
who lost their money met the proper fate
of men who went out for wool and got
shorn. Those who sheared them may
claim the pity which sentimentalists be-
stow on the ruined gambler and nothing
more.
The wag to make money is to work and
to save. He who is far-sighted may ac-
quire fortune by buying property which
he can pay for and which increases in
value with the years. But he who tries to
grow rich by taking other mems money on
the exchanges is like the man who bets his
pile on three jacks and is dismayed when
he finds that the man next him holds four
tens.