THE PROGRESS OF A "CORNER"
There are honest and honorable stock brokers, and Page, a friend of
Nickerson's and acting broker for him, was one of them. He knew Simmons
well, and had at one time or another come in sharp conflict with the
latter in some stock deal. He had watched the bubble, Rockhaven, ever
since its inception, and accustomed as he was to the endless variety of
tricks resorted to by others of his class, had an intuitive conception
of how the general partnership of Weston & Hill and Simmons would be
carried to its culmination.
"It's a swindle, pure and simple," he said in confidence to Nickerson,
"and while Weston is willing to dupe the confiding investors he has
persuaded to buy the stock, the real end and aim of his scheme is to get
the street short of it and, by some sort of scare, start the bears to
bidding against each other, and when the right time comes Simmons will
appear on the scene and unload Rockhaven at top price. How soon that
time will come and how far up they will push the stock before the shorts
take fright, is a guess. It is now steady at six and not much interest
in it. Then again it's an open question how much stock is owned on the
street and how great a short interest has been created. No one has any
confidence in it, and yet many are ready to take a flyer in it for a
turn. My idea is to handle it as one would a hot horseshoe. I am long a
thousand or two, you are ditto for five hundred, and we hold fifteen
hundred in trust for your friend Hardy and this islander, Hutton.
Whether to unload now and make four points or hold for a big stake, is
the question. It's a gamble either way."
And this, be it said, fairly represented the situation.
But Simmons, who really held the key to this well-set trap, knew very
well that he had the street all guessing, and more than that, was just
the man to keep them at it. He sold and he bought a little stock each
day, just to keep it active and quoted. He could have bought every share
on the street if necessary, but that was not his game. What he did want
was to aid the bull pool that had been formed, for every share they
bought meant one more short of that share, and when the time came, one
more scared bear to bid it up. It was an unscrupulous scheme, but one
continually being worked in one way or another by these legalized
gamblers.
Then, as if the devil came to Simmons's aid, Rockhaven began to be
quoted in the bucket shops, and the crowd there, as usual, were all
bulls. It is a strange fact, but true, that every lamb who goes into one
of these wool-shearing offices is always sure to buy, expecting an
advance. With him, stocks are bound to advance--never go down. If they
do, he feels it's only for the time being, and they must go up again,
and so he foolishly puts up more margins, and still more, and the crafty
thief who manages this robber's den assures him he is right; they are
bound to go up, and in privacy smiles at the innocence of his victim.
And so the shearing goes on.
In this case it helped the arch-plotter, Simmons, and his backer,
Weston, for as the stock held firm, those who were short of it at two,
three, and four, had no chance to cover. Then as it began to creep up a
little, to even up their shortage they sold still more, and every few
days a paid item in the _Market News_ helped matters on. What they were
need not be stated. They were all to the same purpose, and that to
create confidence in Rockhaven, and as usual every bear on the street
discounted these statements and felt more certain that Rockhavens were
without substantial value.
And they were right.
Meanwhile Weston, the great financier, as he now felt himself to be,
rubbed his hands with satisfaction and concocted more news items; and
Simmons hobnobbed with the street, assuring one and all of the other
speculative liars what a safe investment Rockhavens were, and how sure
to advance.
"We have not sold much stock and do not care to," he said, "we know a
good thing when we see it, and in this quarry we have a certain
money-maker. It costs us a mere nothing to quarry the stone, the market
absorbs all our product at a good price, and the ledge we own is
limitless. Then we have an excellent manager in whom the firm trusts
implicitly."
He always used "we" in speaking of the stock, that pronoun carrying a
certain assurance, as he well knew, for Simmons, who had grown old and
gray on the street, was a shrewd money-maker and well known to be worth
a million or more.
But while Weston was happy in his prospective success, Hill was not. He
was too greedy, and, narrow-minded as he was, could not wait content
until the Rockhaven plum was ripe. He wanted to grasp it at once, even
to ruin its fruition entirely. He railed and groaned whenever a dollar
was put out, and had from the start. In his narrow vision it was so much
thrown away. Every item in the press that called for outlay, the use of
the thousands held by Simmons to manipulate the market, and especially
the hundred or more that each week had to be sent to the island, each
and all added to Hill's misery. Weston, the liberal rascal, had for a
long time felt disgusted with his partner's miserly instincts; now he
positively hated him and longed for the day when he could deal him a
crushing blow. Both were unscrupulous schemers and thieves at heart, but
of the two Hill was the worse. Not only did Weston come to hate Hill
more and more each day, but he grew tired of the sight of his pinched
and hypocritical face, his sunken eyes and clammy handshake--for shake
hands with him occasionally he must. Then Hill was so unlike Weston in
other ways it added to the feeling of disgust; he never used tobacco or
drank, and held up his hands in holy horror at any lapse from the code
of morality, and worse than that, if Weston let slip any word of
profanity, as he occasionally did, Hill exclaimed against it.
To have one's small vices made a daily text for short sermons is
unpleasant, even to the best of us.
But while Weston's hate and disgust grew apace, no hint of it leaked
out, and since he was the master spirit in the Rockhaven Granite Company
and in that scheme held the reins, it moved on to culmination,
unaffected by Hill's whining.