The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1896-08-04
BUBBLE BURST.
Greatest Speculative Deal
known In Chicago Fails.
The Boomers of Diamond Match
Stock Go Under.
MOORE BROS. QUIT.
The Stock Exchange Closes on
This Account.
History of the Diamond Match
Speculation.

Chicago, Aug. A-The speculative deal
in Diamond Match and New York Bis
cult has come to an end. The Moore
Bros. have failed. The greatest spec
ulation ever known in Chicago has cuI-
minated in the failure of the people who
are behind the deal The Chicago
stock exchange will adjourn at10Oclock
today for an indefinite period. This
action was decided upon at a meeting
efat the members of the stock exchange
governing committee and large num-
Der of prominent capitalists.
This meeting was assembled infor-
maly after the announcement which
was made late in the afternoon by
James H. Moore that margin calls no
longer could be met. The announce
ment was made to a few of the men
most heavily interested Those who
assembled discussed the best means of
restoring confidence after the check
which would be given to speculative
circles by the announcement of the fail
Ure. It was the opinion that it would
be the wisest possible move to close
the stock exchange for a period. The
points made were that nearly the en-
tire business at the stock exchange for
a. number of weeks has been in Dia-
mOnd Match and New York Biscuit
and that the closing of the exchange
would interfere only in a slight degree
with the general financial affairs It
is thought the announcement will last
but few days and that matters can
within that time be Straightened out.
So far as the banks are concerned,
they are Indifferent personally as to
whether the exchange should be closed
or not. The stocks held by them are
margined to a point which leaves them
secure in any event.
The speculative deal of which the fail
ure is the elimination is by all odds
the most important in the history of
the Chicago stock exchange affairs. It
began early in this year. The stock of
the Diamond Match company had been
selling along $50 for quite a time. Just
prior to the Venezuela incident the tip
had got out in inside circles that there
were to be some important European
developments in connection with Ola
mond Match affairs, and the buying of
the stocks commenced by strong peo-
pie. The Venezuelan panic interfered
with the speculation and the stock
dropped during the general decline at
that time to 10 From there the rise
started which is the most remarkable
in the history of the exchange. A
strong group of spectators headed by
James H. Moore and William H. Moore
began buying the stock. 1t moved up
with scarcely a halt The rise went for
a considerable time before the general
public had any intimation Of what was
really behind the advance. In time
came the announcement that the Dia-
mOn6 Match company had closed con
tract with the French government IN
der which the patents and the machin-
y
were to be sold to the French govern
ment for a royalty of 100000 a year.
Following the announcement Of the
closing of the French contract the stock
advanced with great rapidity. Negoti-
atoms were opened for the formation of
a new company in England which
would unite with Bryant & May, the
largest match producers in Great Brit
ain, and would give to the English field
the advantage of the labor saving
American machinery. A factory was
equipped in Liverpool which was owned
by the Diamond Match company and
which served as an object lesson to
European manufacturers
Negotiations were also opened in Aus
tria for the formation of a company
which should combine all the manufac-
| turing interests there. Other cOmpa-
MES were to be organized in Belgium
and Italy.
The shrewdest men in Chicago believ-
| ed in the property, some OF the richest
of ChiagO's spectators operated in the
| market heavily, but the head and front
of the speculative movement was the
Moore Bros. The stock sold up as high
as 248.
When the decline in stock markets
| generally came following the Demo-
cratic convention the stock was selling
at about 224 and was held steadily
without so much as a fractional de-
cline. The MOOres bought the stock
with confidence that inspired confidence
in others. The people who had been the
| best informed about the company's
| prospects seemed to feel absolutely GER
tain of the value of the security and
prices were held through all the sharp
fluctuations in other stocks. It is be-
lieyed that a heavy short interest had
been created by bears, who did not
think quotations could be held in the
face of the decline in the general mar
ket. Apparently the hopes OF the bulls
rested on the size of the short interest.
When the July account came to be
| closed the carrying charges for turn
ing stocks into the August account were
very large, so much SO that faith was
shaken in the existence of an extensive
capital with which the deal had been
carried on had been raised in New
York and New England.
Local banking institutions are only
moderately interested in the affair.
Difficulty was experienced owing to the
general loss of confidence in renewing
some of these eastern loans. Settlement
was successfully passed however, ard
every one believed that in spite of the
heavy carrying charges, the bulls were
still in control of the situation. The
! stock came out, however, in enormous
quantities. The MOOTeS were almost
alone in supporting the market but
they stood under it with remarkable
courage.
Yesterday the stock was held with
hardly a Waver at 222 but there was an
outpouring of long stock which led the
| keen observers of the market to fear
| the load might become too heavy and
! the events later in the afternoon prov
! ed that these fears were correct.
The deal in Diamond Match was only
| part of this great speculative operation.
! The Moore Bros. had organized the New
York Biscuit company several years
/ ago, after the first great success of the
/ Diamond Match company. The panic
of 1898 had hit the biscuit company Sc
/ verely as it did all the other industries,
| and the stock was far below par. The
| success which was met with in a spec
| ulative manipulation of Diamond Match