The morning news. [volume] (Savannah, Ga.) 1887-1900, 1896-05-25
ALMOST RUINED LAY GOULD.
But THE 23D STREET BEAR PAR
TT WAS ROUTED.
Keen RiuGs saved His RIehes-Great
Financier Bought His own De-
eIining stock at An Advance.
hoodwinked Clever Enemies.

D Following the extraordinary Story re-
gariing jay GOulds method OF selling
I a worthless stock which the New York
Press was enabled 10 give 70 its read
ers three weeks ago, We to-day publish
| for the first time the account Of a mo-
/ ment0us incident I'm Gould's career hith-
/ erto known only 10 a few OF his most
| intimate business acquaintances. The
I truth of this story. as OF the former. is
| absolutely guaranteed. The source from
/ which the facts have been obtained is
| unquest.onably trustworthy. No com
I plerely true biography of any complete
| ness whatever has hitherto been pub
! lished regarding this exceptional career.
/ The truth, the whole truth, VIII appear
/ gradually. and the stories the Press is
/ enabled TO publish are the most authentic
| statements yet given to the world.
| 1t is generally supposed that Jay
/ Gould's career was uniformly prosperous,
/ that from the day on which he entered on
! the intrlgues and speculauons on the
/ street he carried everything before
! him; that with the exception OF a few
I minor lallufcs ms fortune continued 10
/ increase. This idea is incorrect. There
| came day, when, after years Of sue
] cesstul speculation, the great nnancier
/ found all his schemes thWarted, his hold
! upon the strings which regulate the mar
| ket snatched from has grasp and ruin
| was so apprehenslve OF the result of the
| turn affairs were taking that he repeated
/ ly urged his father 20 make an assign
] ment, fearing that otherwise nothing
! could be saved.
The manner in which Jay Gould turned
| circumstances which appeared about TO
| ruin him utterly to his own favor and the
| destruction of those VINO We're scheming
| against him proves, more than any other
incident in his career his remarkable
| genius.
Here is the story:
| In 1884 Gould's fortune was almost en-
! tirely invested in two securities-AI issOuri
| Pacific and Western Union. This fact by
! some accident came TO the ears Of the
| leaders of the clique in the street which
Street Bear Party" The most prominent
| members Of this party were Mr.. WOeris-
! chofter and Henry n. Smith. They thought
| they saw in the circumstances mentioned
| chance at last 10 cripple the Little
| Wizard" As much capital as could be
had was collected, and they started to
| the securities.
They succeeded. Within two or three
| monthes Western Union fell to 30 and
| Missouri Pacific to o.
Each stock had fallen between thirty
| ana forty points. From valuable invest
| ment securities they became. practically
! speaking, almost worthless. Not knowing
| how much value would be deprecated, no
| one would invest, except for speculation
purposes and, what was more To the
| point as far as Gould was concerned IL
| was impossible to borrow money on them,
| as, naturally enough, capitalists waited
until they found just how low they were
| going.
Gould was in a quandary His whole
| fortune was invested in these two securi-
ties; In order to prevent them being
| pushed down TO ru.nous quotations he
| required ready money, and this was just
| what ne could not obtain.
| For a short time he was obliged to re-
| sort-in order to keep the necessary bal
| ance a his banker's-tO an expensive eX-
! pedlent The only way the stocks were
! OF Value was Tor speculation Every day
| ne sold enormous blocks for cash, and
| bought back equal amounts, at the same
| prices, regular That is to say, ne sold
for cash payments and what he bought he
paid for the next day. OF course, he was
selling for a fraction less than he was
buying for, the difference between "cash"
and regular" quotations being small
This gave him the use of large amounts
! OF money for day at a time but no one
| knew better than he that 1t was an ex-
| pedient that would soon ruin him. Ev-
| cry afternoon immense bundles of securi-
! ties could be seen Issuing from the Of
flee of Conner & Co. (Goulds principal
! brokers', and every morning equally
| large amounts were brought in. But ev-
! cry day meant a loss of thousands Of
dollars, and 1t looked as though crisis
Ut was at this juncture that those closest
to Gould urged upon him the necessity Of
making an assignment. His son George,
! who had assisted his father for some time
! was especially anxious that this should be
done, as he feared that otherwise the for
| tune accumulated with so much skill and
pains would be entirely lost. Jay Gould
heSitatcd. He saw the danger Of contin-
uing under the existing circumstances. but
| he knew that should he do what was urged
| his standing would be gone forever.
! For the first time his courage deserted
| nm; On Saturday Things came 10 mead
| Could he not manage to turn things In his
| favor in some way, without delay, he de-
cided to do as his friends wished.
The next day Sunday the principal
members of the Twenty-third street bear
| party met at Long Branch. Gould decided
on a bluff. He went there on his yacht
and saw Mr.. WOerlschoffer, and told him
| that if his clique would not desist from
| bearing the market he Could would start
| In to lower prices himself, and send every
| security down to nothing.
| Whether Mr.. Woerischoffer believed this
! is uncertain, but at this meeting he made
/ a proposition to Gould which, as II ap-
/ peared later, was the turning point of the
/ affair.
The bear syndicate were unaware Of
| GOulds monetary embarrassment, other
/ wise they would not have made the sug-
/ gestion they did, but would have contin-
/ ued to pound the market until he gave
| up The clique We're in trouble them
/ selves, and Mr.. Woerischoffer, unfortu-
! nately for them, made a suggestion which
/ enabled Gould to see where their weak
/ ness lay.
They were bearing the securities, but If
| was. necessary for them to obtain a large
! block of Western Union in order to con-
| tinue to do SO. Mr.. Woer.schoffer made
!
| outright a 50. OF course the price was a
| ruinous one, but Gould did not hesitate
| The offer was accepted, and he had $780,
/ 600 in cash at his bankers.
! The possession Of the $4,000 shares Of
| Western Union enabled the syndicate to
| make an enormous profit on that stock
| But their satisfaction was not long lived.
/ With the money he obtained from the sale
/ Gould was enabled to advance the price
/ of his other stock, Missouri Pacific, from
| g. to par 600. The syndicate had been
! selling enormous amounts of this stock at
! 60, and every cent of the profit from
| Western Union went to pay the difference
/ in Missouri Pacific. They lost millions of
/ dollars of their own money also. Gould
! turned the tables on them completely and
| in a wink he was as rich as he ever had
| been.
1 The fnesse of this coup of the little
| wizard can hardly be understood except
| by Wall street men. The real secret Of
/ the maneuver lay In the weakness that
| Gould perceived when the syndicate Of
! fered to buy stock from him. lie judged
| that they had been selling what they
| did not pOssess-rightly as il turned out
| and devoted every penny he had to cor
nering them on the other, stock, (Mis-
/ meet the rise of course he would have