MONEY IN SPECULATION.
True Stories that are Stranger than Fiction--Fortune’s Great
Army--The Rise of Jay Gould--The Meteoric Career of James
Fisk--Ferdinand Ward, the Napoleon of Finance--How Vanderbilt Made
a Million in a Day--A Man who was Devoured by both Bulls and
Bears--Some Rules for Timid Investors--John C. Eno, the Free-Lance
Operator--The Wonderful Success of James R. Keene--How Daniel Drew
Spelled “Door”--The Great Leiter Wheat Deal.
This is a dangerous sea, strewn with wrecks, but the fascination in the
thought of making a fortune in a single day ever has and ever will cast
its spell upon the human mind. Some men will take great risks in the
hope of glittering gains. We give a few of the most promising forms of
speculation, with examples of those who have been successful with the
dice of fortune.
Jay Gould was employed as a map-maker at a salary of $30 per month. He
trudged over whole counties in New York State as a surveyor. A lucky hit
brought him into Wall Street, where he made over $70,000,000 in forty
years.
James Fisk came down from Vermont a penniless boy, but getting into the
company of Wall Street men he soon amassed an immense fortune.
Ferdinand Ward, called the Napoleon of Finance, had an unequaled gift
for shrewd speculation, and might have excelled all contemporaries had
he chosen to stick by honest methods. He made a fortune before he was
arrested for “crooked ways.”
Cornelius Vanderbilt at twenty earned a living by rowing a boat between
Staten Island and New York. At sixty he was proprietor of a fleet of
sixty-six steamboats and owner of several railroads. He made his money
in stocks. In the fluctuations of the Erie, on one occasion he made a
million dollars between rise and set of sun.
John C. Eno was called the free-lance operator. He was one of the
boldest manipulators of stocks, and acquired an immense fortune.
Perhaps the most striking success was that of James R. Keene, who made
$9,000,000 in three years.
Others who have won their fortunes in Wall Street are Russell Sage,
William Belden, George I. Seney, Henry Villard, William H. Vanderbilt,
William R. Travis, C. P. Huntington, and Daniel Drew.
Of the last named it may be mentioned--to show how little a college
education has to do with success in business--that he was very
illiterate, possessing only a scanty knowledge of grammar, and even of
spelling. It is related that on one occasion he told his cashier that he
would set the safe lock on the word “door.” When the cashier wanted to
open the safe, he tried “door” in vain. Knowing his employer’s queer
methods of spelling he tried varieties on “door,” such as “dore,”
“doar,” etc., but all in vain. At last he was obliged to go to the hotel
and awake his employer, who had gone to bed. “Uncle Dan’l” was quite
crusty at being awakened, and told his cashier again that he had set the
safe on the word “door.” “But how do you spell ‘door’?” inquired the
cashier. “Why,” said “Uncle Dan’l” tartly, “any fool can spell ‘door.’
You’d better get out of the business if you can’t spell, and I’ve a
mind to discharge you on the spot. How do I spell ‘door?’ Why,
‘d-o-a-r-e,’ of course!” The next day, however, on reflection the old
man relented, and concluded not to discharge his trusted employee for so
trivial a blunder.
A rule for speculators is: “Don’t invest on professional advice.” Your
advisers have “an ax to grind.” A man once ordered a broker to buy 1,000
shares of Erie when the price was 94; it immediately dropped, and he
ordered it sold when it was 92-1/2. In half an hour he returned and
ordered it bought again. It had then gone up to 95. After consulting
again with “friends,” he again ordered it sold. The market then was down
to 90. He came back the fifth time and said: “I consulted one man who
told me to buy; then another who told me to sell. I understand that one
is called a bull and the other a bear. I don’t know much about these
names, but I do know that I have been a jackass.”
A much safer plan is to follow the lead of shrewd speculators. In Wall
Street you should reverse the advice given to the disciples concerning
the Pharisees. Christ said, “Do as they say, but not as they do.” But
with speculators the direction should be, “Do as they do, but not as
they say.”
The chief form of speculation is in stocks. These stocks may be
railroads, mines, wheat, corn, cotton, wool, tobacco, oil, gas, coal,
and, in fact, almost any industry where capital has constantly
vacillating values. We have room to mention only a very few:
942. CITY BONDS.--These are generally among the best securities for
investment. The element of speculation comes in when they are bought
below par in the belief of an early rise. A sharp Yankee bought $100,000
of defaulted bonds of the city of Houston, Texas, forced a settlement at
par, and doubled his money.
943. COLONIAL TRADE.--We have the very best authority for the
information that the trade in our newly acquired territory, the
Philippine Islands, will be worth one billion dollars annually under
American development. Here is an immense opportunity for every form of
profitable speculation. Cuba, Porto Rico, and Hawaii, also, are inviting
fields, and there is no doubt that the next decade will witness the
making of many fortunes in those islands, and the foundations of
hundreds of others. Now is the time to begin, as those earliest in the
field will have the first chance to buy up depreciated stocks and
lagging industries.
944. THE AMERICAN TOBACCO COMPANY.--One of the most vacillating stocks
lately has been that of the American Tobacco Company. In January of the
current year--1898--Mr. J. R. Keene purchased 80,000 shares at $90.
September 26th, fearing the market was about to decline, he began to
sell, and in two days had completely unloaded at figures ranging at $145
to $139. He cleared about $1,500,000 in the two days.
945. COLLAPSED RAILROADS.--For a capitalist there are few more promising
fields than the buying up of collapsed or run down railroads. Mr. George
I. Seney accumulated a large fortune by purchasing at a little more than
nominal figures bankrupt or embarrassed roads, and by thorough
equipment, and by connection with more prosperous roads, soon put them
in a paying condition. If you can get one end of a small road into a
large city, or if you can arrange to make it the feeder instead of the
rival of a large road, it will be almost certain to yield abundant
returns.
946. WHEAT MARGINS.--Fortunes are daily made and lost in wheat.
Everybody has heard of the great Leiter deal. Joseph Leiter often made
$100,000 in a single day. In ten months he rendered things lively in
every great center of the world, and in this period of less than a year
he actually made $4,500,000. True, he lost it again, but the fact that
one could corner such a fortune in so short a time shows what may be
accomplished with courage and capital. The safest rule for small and
timid operators is to follow in the wake of these bold speculators, but
not too far. It may be laid down almost with the certainty of a logical
premise, that, when a man of vast resources and thoroughly familiar with
the field enters the market, he is bound to win at first, but bound to
lose if he presses things too far, because the tremendous stress
produces at last reactionary conditions which no manipulator and no
combination of speculators are able to face. It does not matter so much
whether you are a bull or a bear, if you can perform the difficult feat
of holding yourself in.