Fifty years in Wall Street
disastrous years only occur occasionally, and that in three
favorable seasons the profits will be large enough to stand one
bad season in three. They may hear of all this after they sell
out, but the old settler is not offering information that can
only be bought with experience until it is valuable as a
mournful reflection.
The Iron Mountain Railroad has a station called Malvern. It is
44 miles south of Little Rock. As his car pulls into Malvern Mr.
Gould sees on a narrow gauge railroad that also has a station
there an engine with a diamond-shaped head-light. The narrow
gauge road runs from Malvern to Hot Springs. Mr. Gould has no
interest in it, but he knows it was built and is owned—every
spike in it—by a man who received his first start in life from
the same man who placed him on his feet. The Hot Springs
railroad is owned by “Diamond Joe” Reynolds, who was started in
business many years ago by Zadock Pratt, of the town of
Prattsville, Greene county, N. Y., when the young man lived in
Sullivan county, right across the line of Delaware county,
Penn., where Jay Gould was enabled by Mr. Pratt to tan hides
with oak and hemlock bark, not after the fashion of Wall Street.
Reynolds and Gould were assisted by Mr. Pratt about the same
time. Reynolds is not as wealthy to-day as Mr. Gould, but he
owns all the money he wants, and Mr. Gould has often said it did
not need fifty millions to secure contentment. “Diamond Joe”
Reynolds is a rich man and he spends much of his time between
Chicago and Hot Springs. On his first visit to Hot Springs he
was compelled to stage it from Malvern. The ride disgusted him
as much as the Springs delighted him. He found a man who had
obtained a charter for a railroad from Malvern to the Springs
and who had no money. The charter and some money changed hands.
Reynolds built the railroad and owns it, rolling stock and all.
The road is 24 miles long. He made his money in wheat, but not
in Sullivan county. After getting a start there he went West and
shipped wheat from Wisconsin to Chicago. He shipped it in sacks
and marked the sacks with a diamond and inclosed in it the
letters “J. O.” It was from this circumstance, because the sacks
and trade mark became widely known, that he obtained the
sobriquet of “Diamond Joe,” and not as those who have only heard
of him think for a penchant for gems, and Mr. Reynolds is modest
as well as rich.
Mr. Gould travels like a rocket while inspecting his roads. In
this way he gets a certain amount of exercise, for, as travelers
know, a heavy train drawn at the rate of 50 miles an hour will
make little fuss in comparison with the antics of a single car
tacked to an engine making the same rate. Mr. Gould often
travels in the Convoy at a 50-mile gait, and during such a trip
he has been known to change seats—from one side of the car to
the other—not of his own volition, but without changing
countenance. So long as Superintendent Kerrigan keeps his hand
off the bell rope Mr. Gould makes no remonstrance, but accepts
his shaking without a grumble. He changed engineers on one of
his recent trips without knowing it. The engineer had been
running slowly, for reasons of his own, in spite of numerous
pulls at the bell cord. When, however, he discovered that dinner
was under way he pulled the throttle open, and the locomotive
darted ahead suddenly as if going through space. The jar cleaned
the table like a flash. At the next station the engineer was
promoted to a freight train.
A REMINISCENCE OF KANSAS PACIFIC.
There is an interesting piece of information regarding the deal in
Kansas Pacific in the testimony of Mr. Artemus H. Holmes, formerly the
attorney of that company, showing how the stock made a marvelous leap
from two or three dollars to par in seven days. Mr. Holmes testified as
follows:
From 1873 to 1877 the market value of all the Kansas Pacific
securities was extremely low. The Kansas Pacific stock was $2 to
$3 a share and practically valueless. Land grant bonds were
worth 10 cents on the dollar, and Denver extension about 40, but
ranged from 50 to 70 in 1876 to 1878. The first mortgage bonds
were below par, the company’s credit was gone and the stock
unmarketable. Sidney Dillon, who was then President of the
Kansas Pacific Company, was anxious to have the matter settled
as quickly as possible. At the former’s suggestion a friendly
suit was brought on January 17, 1880, before Judge Donohue, in
the Supreme Court, in this city, to settle the ownership of the
Denver Pacific stock. The trustees said they could not do
anything with the stock that would injure it. On January 20,
1880, Horace M. Ruggles, as referee, heard argument, the case
was closed in two days, the decision was made January 23 and the
decree signed by Judge Donohue on January 24, giving the stock
to the Gould party. Mr. Holmes stated: “All the time this was
pending the articles of consolidation were being drawn up, but I
did not know anything about it until they were signed on January
24.” Referee Ruggles decided that 29,000 snares of Denver
Pacific stock free from mortgages should pass to the Kansas
Pacific. This was put into the Union Pacific and 29,000 shares
of the consolidated company’s stock given in exchange, which
sold at par. The witness was sharply questioned as to what he
knew about Referee Ruggles’ report. He was asked if he knew who
wrote the report, or had any knowledge as to who did.
Q. In order to prepare the decree which was signed on Jan. 24,
you must have had the finding before you, did you not? A. No.
Q. How could you prepare it without knowing what the finding
was, for the decree was presented the very next day? A. I must
withdraw that answer, and change it to yes.
Gov. Pattison—Do I understand you to say that the stock which
was exchanged had risen in a few days from $2 to $3 a share to
par. Mr. Holmes said that was a fact, and then this question was
put to him:
Q. In other words, Mr. Dillon had sworn on Jan. 17, 1880, that
the stock had no financial value, and yet on Jan. 24 it was
worth par. A. Yes.
This discloses another of Mr. Gould’s valuable secrets of the way to
make money rapidly.
GOULD’S FIRST YACHTING EXPERIENCE.
There is a humorous story told of Mr. Gould’s first yachting experience,
which was recently published in the Philadelphia _Press_, and its
veracity vouched for by a living witness to the event. It is
characteristic of Mr. Gould in some special respects, and runs as
follows:
At the residence of a club man, whose reputation as a
_raconteur_ is nearly as great as that of his Burgundy, I
noticed a pretty model of a jib and mainsail yacht. Replying to
my admiring inquiry the club man explained:
“That is the model of a boat upon which were passed some of the
sunniest hours of my life. She was owned by one of the Cruger
family, of Cruger-on-the-Hudson, and has an added interest from
the fact that upon her Jay Gould acquired his first yachting
experience, and so eventful a one that I’ll bet he remembers it
to this day.
“Crugers—one of the oldest and best known families in the State,
intermarried as they are with other Knickerbockers like the
Schuylers, Livingstons and Van Rensselaers—owned all the land in
the neighborhood of the station subsequently named after them. A
portion of this property consisted of a brick yard, which was
rented to the son of old Schuyler Livingston. It was in 1853 or
1854, and Jay Gould had just failed in the tannery business in
Pennsylvania.
“Young Livingston’s leased brick yard wasn’t paying, and he
concluded that it needed a shrewd business man at its head. He
advertised for a partner, and one day there appeared in response
a small, dark gentleman, looking scrupulously neat in his black
broadcloth. He gave his name as Jay Gould. Pending negotiations,
Mr. Gould became the guest of the Crugers at the old mansion on
the hill. Every effort was put forth to entertain him during his
stay, the more as he seemed to regard favorably a partnership
with their young friend.
“One day Mr. Cruger invited Gould to a sail to Newburgh, and got
ready his yacht, of which that model is the reduction. Several
of us youngsters were taken along to help work the boat. Eugene
Cruger, a nephew of the yacht’s owner, was one of us. Peekskill
was reached and the whole party went up to the hotel.
“All the way up the river we had noticed that Mr. Gould was
uneasy, shifting about constantly on the deck, where he sat, and
squirming and twisting as if seeking to find a softer spot.
Nothing was said about it, of course, but when we landed Mr.
Gould himself furnished the explanation. From the heat of the
sun the yellow paint on the boat’s deck had become baked and
chalky, and it was not long before the little man discovered
that the dry powder was coming off on his trousers. Hence his
uneasiness. He concluded by saying he was afraid his broadcloth
nether garments would be, if they were not already, ruined, and
was determined to abandon the trip and return by rail. This Mr.
Cruger would not hear of, and promised to obviate the
difficulty. We all adjourned to a general store and Cruger
bought, for two shillings and a half, a pair of jean overalls.
These Mr. Gould put on when we went aboard the boat and
expressed his unqualified satisfaction at the result.
“On our trip back from Newburgh we again called at Peekskill,
and once more the party started for the hotel. This time Mr.
Gould declined the invitation to take something and preferred to
remain on board. About an hour was spent in the hotel, when
suddenly Mr. Cruger remembered that he wanted some white lead,
and young Eugene Cruger and I went with him to the store to
carry it down to the boat.
“‘How’d the overalls work, Mr. Cruger?’ was the salutation of
the storekeeper. Then before answer could be returned, he added
admiringly: ‘That friend o’ yourn is purty shrewd.’
“‘Who, Mr. Gould? Yes, he appears to be a thorough business
man.’
“‘Well, I sh’d say so! He can drive a mighty sharp bargain.’
“‘Drive a sharp bargain?’ repeated Cruger, all at sea. ‘What do
you mean?’
“‘Why, don’t you know he was in here ’bout three quarters of an
hour ago, and sold me back the overalls you bought for him.’
“‘Thunder, no!’ roared Cruger in astonishment.
“‘Well, sir, he jest did that. He kem in here, tole me he’d no
fu’ther use for ’em, that they was as good as when I sold ’em,
an’ after we’d haggled awhile he ’greed ter take two shillin’
fur ’em, which I paid him. Here’s the overalls.’
“I can shut my eyes now,” went on the jolly club man, with a
hearty laugh, suiting the action to the words, “and call up Mr.
Cruger’s face with its mingled expression of amazement and
incredulity. He left the store in silence. Not until we had
nearly reached the boat did he speak. Then he only said, ‘Boys,
I’ll fix him for that?’ We reached home without any reference to
the incident. On the way back Mr. Gould sat upon his
pocket-handkerchief.
“The same night Mr. Cruger perfected his plan. Next day Mr.