Fifty years in Wall Street
He was a Democrat in politics. As to his religious belief, I expect if
he had been questioned on that he would have given the same answer as
another eminent man who cut a great figure in this country: “The world
is my country; to do good is my religion.” Travers might have added: “I
also wish to be the means of creating and diffusing the greatest amount
of social happiness and enjoyment of which humanity is capable.”
I may conclude by saying of Travers, as an eminent author observed of
his namesake the divine William, the Bard of Avon, “We ne’er shall see
his like again.”
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CHAPTER XL.
CHARLES F. WOERISHOFFER.
THE CAREER OF CHARLES F. WOERISHOFFER, AND THE RESULTANT EFFECT UPON
SUCCEEDING GENERATIONS.—THE PECULIAR POWER OF THE GREAT LEADER OF
THE BEAR ELEMENT IN WALL STREET.—HIS METHODS AS COMPARED WITH THOSE
OTHER WRECKERS OF VALUES.—A BISMARCK IDEA OF AGGRESSIVENESS THE
RULING ELEMENT OF HIS BUSINESS LIFE.—HIS GRAND ATTACK ON THE VILLARD
PROPERTIES, AND THE CONSEQUENCE THEREOF.—HIS BENEFACTIONS TO
FAITHFUL FRIENDS.
By the death of Charles F. Woerishoffer, Wall Street lost one of the
most prominent figures which has ever shown up here. Mr. Woerishoffer
died May 9, 1886. His career is one worthy of study by watchers of the
course of speculation in this or any other country. The results of his
life-work show what can be accomplished by any man who sets himself at
work upon an idea, and who devotes himself steadily and persistently to
a course of action for the development and perfection of the principle
which actuates his life. Mr. Woerishoffer possessed peculiar personal
qualities which are denied to most men and to all women. He had the
magnetic power of impressing people with confidence in the schemes which
he inaugurated; that is to say, he had the power of organization—the
same power has made other men great, and will continue to make men great
who possess it in all walks of life. Notable instances may be cited in
the cases of Bismarck, Gladstone, Napoleon, Grant, and—coming down to
Wall Street proper—Gould, Daniel Drew, old Jacob Little and the
Vanderbilts, especially the Commodore, in his superior power of
aggressiveness.
It has been said of Mr. Woerishoffer that he was fortunate. He was
indeed. He was fortunate in the possession of natural ability, and he
had the aptitude to take advantage of events, and associate
circumstances and the strength of purpose, and to direct, instead of
following, the operations with which he became connected. He was the
leader of the bear element of the Street—at least he was such during the
period which marks his successful operations here. There is no doubt
that the death of Mr. Woerishoffer was hastened because of the great
strain of mind growing out of his business transactions. There is one
point in this connection which has been overlooked by his biographers,
namely, that his boldness in the magnitude of his dealings was resultant
from a careless or non-calculative mind. I do not believe that Mr.
Woerishoffer ever undertook a speculation of any sort until he had
carefully calculated all the chances _pro_ and _con_, and his success,
remarkable as it was, was largely due to the combination of calculation
and the natural development of business conditions, of which he was a
close student.
Mr. Woerishoffer’s conception of business principles was iconoclastic to
an intense degree. As a broker, as a business man, as an operator in
stocks, he “believed in nothing;” that is to say, he was a believer in
the failures of men, and had no faith in the corporations and
enterprises which were organized for the purpose of the development of
the best interests of the country in which he lived. There is another
view, or another statement of this peculiar feature, of the character of
this man which may be given in description, and this is illustrative of
the careful study he made of everything passing along in the lines of
life with which he was connected. It is this: That Mr. Woerishoffer, by
his intimate study of the prospects and probabilities of the projected
plans of enterprising Americans, had come to the conclusion that the
majority of them must fail, and that the first flush of enterprise would
be changed to a darker shade as time progressed. That is to say, he saw
and knew a great deal of the organization of the railroad schemes which
have marked the growth of our rapid development in a business way, and
he judged that the inflated ideas of the projectors must meet with a
check as developments were made, and that the earning capacity of the
roads would not equal expectations. Hence he sold the stocks, and sold
them right and left from the start, and with his followers reaped the
profits. Woerishoffer never indulged in the _finesse_ of Gould or Henry
N. Smith. He had the German ideas of open fight, and he attacked
everything indiscriminately, losing money sometimes, but making money at
other times, and by his open dash and persistency carried his point.
There is no doubt that the successful career of a man of this sort has a
deleterious effect upon those who follow him in succeeding generations.
It does not matter how successful the development of the business
industries of this country may be hereafter, there will always be found
men who will speculate upon the ruination rather than the success of the
best interests of the country merely because Charles F. Woerishoffer
lived and made a fortune by his disbelief and his disregard of the
growth of the institutions of the country which gave him a home.
Woerishoffer was a wonderful example of the sudden rise and steady and
rapid progress of a man of strong and tenacious purpose, who adheres
with firmness to one line of action or business. He was born in Germany.
Woerishoffer’s Wall Street career was begun in the office of August
Rutten, afterwards of the firm of Rutten & Bond, in which Woerishoffer
subsequently became Cashier. He left this firm in 1867, and joined M. C.
Klingenfeldt. Mr. Budge, of the firm of Budge, Schutze & Co., in 1868,
bought him a seat in the Stock Exchange. Some time after he entered the
Board he became acquainted with Mr. Plaat, of the well-known banking
firm of L. Von Hoffman & Co. Mr. Woerishoffer was entrusted with the
execution of large orders, especially in gold and Government bonds. At
that time the trading in these securities was very large. Afterwards
Plaat became an operator himself, and Woerishoffer followed in his
footsteps as an apt pupil. Eventually he formed the firm of Woerishoffer
& Co., his first partners being Messrs. Schromberg and Schuyler, who
made fortunes and retired.
Woerishoffer was connected in enormous operations with some of the
magnates of the street; for instance, James R. Keene, Henry N. Smith, D.
P. Morgan, Henry Villard, Charles J. Osborn, S. V. White, Addison
Cammack, and last, though not least, Jay Gould. He was especially on
intimate terms with his great brother bear, Addison Cammack, both
speculatively and socially. Besides being a bold operator in the street,
Woerishoffer was associated with large railroad schemes, which gave him
the inside track in speculation. He was connected with the North River
Construction Company, the Northern Pacific, Ontario & Western, West
Shore, Denver & Rio Grande, Mexican National, several of the St. Louis
Companies, and Oregon Transcontinental. He was originally a rampant bull
on these properties until they began to get into trouble, and then he
became a furious and unrelenting bear. He smashed and hammered them down
right and left. He soon covered his losses, and began to make enormous
profits on the short side of the market. On the bonds and stock of the
Kansas Pacific, when it became merged in the Union Pacific, it is
supposed that Woerishoffer cleared over a million dollars.
Woerishoffer, it seems, was one of the first to propose the building of
the Denver & Rio Grande Railroad. On this enterprise he realized immense
profits for himself and his friends. The stock rose until it reached
110, and was “puffed” up for higher figures. The public was attracted by
the brilliant prospects of immense profits on the long side. Mr.
Woerishoffer and friends held large quantities of long stock, but sold
out, and afterwards put out a large line of shorts. The bear campaign
had Woerishoffer as leader, and, it is said, he succeeded in covering as
far down as 40, and some even lower. In 1878, when the market began its
great boom on account of the resumption of specie payment and the
general prosperity of the country, he organized a combination which
bought stocks largely and sold wheat short. On this deal he made large
profits, and began to develop into a pretty strong millionaire. He took
advantage of the shooting of President Garfield, in 1881, together with
his colleagues, Cammack and Smith, to organize a bear raid on a large
scale, which was probably one of the chief, although somewhat remote,
causes of bringing about the panic of 1884.
The great perspicacity which he had in the deals enumerated failed him
in 1885. He thought, as the wheat crop was small, that wheat would go up
and stocks would go down, but the very reverse occurred. The
disappointment and depression, very probably, resulting from this
brought on the aneurism of the heart, which killed the great bear
operator, and his death was a fortunate event for Wall Street.
One of the many things which gave Woerishoffer great reputation as a
speculator, both here and in Germany and England, was the bold stand he
took in the fight for the control of Kansas Pacific against Jay Gould,
Russell Sage, and other capitalists, railroad magnates and financiers in
1879. He represented the Frankfort investors, and had engaged to sell a
large quantity of Denver extension bonds at 80, to the Gould-Sage
syndicate. The syndicate, however, knowing that they had the controlling
influence, declared the contract for 80 off, and “came to the
conclusion, after examining the road-bed, that the bonds were not worth
more than 70,” and they would not take them at a higher figure.
Woerishoffer then made a grand flank movement on the little Napoleon of
finance and his able lieutenants. He seemed to be greatly put out that
they had broken their contract, but did not complain very bitterly. He
immediately cabled to the English and German bondholders, and soon
secured a majority of the bonds which the syndicate wanted, and
deposited them in the United States Trust Company. He then informed the
syndicate that they could not obtain a single bond under par to carry
out their great foreclosure scheme. It was this circumstance that caused
Frankfort speculators and investors to come so largely into the New York
stock market, and that also made English capital flow in freely,
speculators throwing off their former timidity. The amount involved in
the Gould-Sage syndicate deal was about $6,000,000 of bonds, thus
netting Woerishoffer considerably over a million. This deal at once gave
him an international reputation as a far-sighted speculator, and this
reputation was gained at the expense of Gould and Sage, owing to their
disregard of the contract which had been entered into.
Woerishoffer showed great sagacity as a speculator when Henry Villard
put forward his immense bubble scheme in Northern Pacific and the
Oregons. Although invited to go into the big deal with other millionaire
speculators who had taken the Villard bait so freely, Woerishoffer kept
prudently aloof, and looked on the players at the Villard checkerboard
with equanimity and at a safe distance. He was not then considered of