When the ferry system began to run, and the time between Oakland and
San Francisco was demonstrated to be cut in half, the tide of
Daylight's terrific expenditure started to turn. Not that it really
did turn, for he promptly went into further investments. Thousands of
lots in his residence tracts were sold, and thousands of homes were
being built. Factory sites also were selling, and business properties
in the heart of Oakland. All this tended to a steady appreciation in
value of Daylight's huge holdings. But, as of old, he had his hunch
and was riding it. Already he had begun borrowing from the banks. The
magnificent profits he made on the land he sold were turned into more
land, into more development; and instead of paying off old loans, he
contracted new ones. As he had pyramided in Dawson City, he now
pyramided in Oakland; but he did it with the knowledge that it was a
stable enterprise rather than a risky placer-mining boom.
In a small way, other men were following his lead, buying and selling
land and profiting by the improvement work he was doing. But this was
to be expected, and the small fortunes they were making at his expense
did not irritate him. There was an exception, however. One Simon
Dolliver, with money to go in with, and with cunning and courage to
back it up, bade fair to become a several times millionaire at
Daylight's expense. Dolliver, too, pyramided, playing quickly and
accurately, and keeping his money turning over and over. More than
once Daylight found him in the way, as he himself had got in the way of
the Guggenhammers when they first set their eyes on Ophir Creek.
Work on Daylight's dock system went on apace, yet was one of those
enterprises that consumed money dreadfully and that could not be
accomplished as quickly as a ferry system. The engineering
difficulties were great, the dredging and filling a cyclopean task.
The mere item of piling was anything but small. A good average pile, by
the time it was delivered on the ground, cost a twenty-dollar gold
piece, and these piles were used in unending thousands. All accessible
groves of mature eucalyptus were used, and as well, great rafts of pine
piles were towed down the coast from Peugeot Sound.
Not content with manufacturing the electricity for his street railways
in the old-fashioned way, in power-houses, Daylight organized the
Sierra and Salvador Power Company. This immediately assumed large
proportions. Crossing the San Joaquin Valley on the way from the
mountains, and plunging through the Contra Costa hills, there were many
towns, and even a robust city, that could be supplied with power, also
with light; and it became a street- and house-lighting project as well.
As soon as the purchase of power sites in the Sierras was rushed
through, the survey parties were out and building operations begun.
And so it went. There were a thousand maws into which he poured
unceasing streams of money. But it was all so sound and legitimate,
that Daylight, born gambler that he was, and with his clear, wide
vision, could not play softly and safely. It was a big opportunity,
and to him there was only one way to play it, and that was the big way.
Nor did his one confidential adviser, Larry Hegan, aid him to caution.
On the contrary, it was Daylight who was compelled to veto the wilder
visions of that able hasheesh dreamer. Not only did Daylight borrow
heavily from the banks and trust companies, but on several of his
corporations he was compelled to issue stock. He did this grudgingly
however, and retained most of his big enterprises of his own. Among
the companies in which he reluctantly allowed the investing public to
join were the Golden Gate Dock Company, and Recreation Parks Company,
the United Water Company, the Uncial Shipbuilding Company, and the
Sierra and Salvador Power Company. Nevertheless, between himself and
Hegan, he retained the controlling share in each of these enterprises.
His affair with Dede Mason only seemed to languish. While delaying to
grapple with the strange problem it presented, his desire for her
continued to grow. In his gambling simile, his conclusion was that
Luck had dealt him the most remarkable card in the deck, and that for
years he had overlooked it. Love was the card, and it beat them all.
Love was the king card of trumps, the fifth ace, the joker in a game of
tenderfoot poker. It was the card of cards, and play it he would, to
the limit, when the opening came. He could not see that opening yet.
The present game would have to play to some sort of a conclusion first.
Yet he could not shake from his brain and vision the warm recollection
of those bronze slippers, that clinging gown, and all the feminine
softness and pliancy of Dede in her pretty Berkeley rooms. Once again,
on a rainy Sunday, he telephoned that he was coming. And, as has
happened ever since man first looked upon woman and called her good,
again he played the blind force of male compulsion against the woman's
secret weakness to yield. Not that it was Daylight's way abjectly to
beg and entreat. On the contrary, he was masterful in whatever he did,
but he had a trick of whimsical wheedling that Dede found harder to
resist than the pleas of a suppliant lover. It was not a happy scene
in its outcome, for Dede, in the throes of her own desire, desperate
with weakness and at the same time with her better judgment hating her
weakness cried out:--
"You urge me to try a chance, to marry you now and trust to luck for it
to come out right. And life is a gamble say. Very well, let us
gamble. Take a coin and toss it in the air. If it comes heads, I'll
marry you. If it doesn't, you are forever to leave me alone and never
mention marriage again."
A fire of mingled love and the passion of gambling came into Daylight's
eyes. Involuntarily his hand started for his pocket for the coin.
Then it stopped, and the light in his eyes was troubled.
"Go on," she ordered sharply. "Don't delay, or I may change my mind,
and you will lose the chance."
"Little woman." His similes were humorous, but there was no humor in
their meaning. His thought was as solemn as his voice. "Little woman,
I'd gamble all the way from Creation to the Day of Judgment; I'd gamble
a golden harp against another man's halo; I'd toss for pennies on the
front steps of the New Jerusalem or set up a faro layout just outside
the Pearly Gates; but I'll be everlastingly damned if I'll gamble on
love. Love's too big to me to take a chance on. Love's got to be a
sure thing, and between you and me it is a sure thing. If the odds was
a hundred to one on my winning this flip, just the same, nary a flip."
In the spring of the year the Great Panic came on. The first warning
was when the banks began calling in their unprotected loans. Daylight
promptly paid the first several of his personal notes that were
presented; then he divined that these demands but indicated the way the
wind was going to blow, and that one of those terrific financial storms
he had heard about was soon to sweep over the United States. How
terrific this particular storm was to be he did not anticipate.
Nevertheless, he took every precaution in his power, and had no anxiety
about his weathering it out.
Money grew tighter. Beginning with the crash of several of the
greatest Eastern banking houses, the tightness spread, until every bank
in the country was calling in its credits. Daylight was caught, and
caught because of the fact that for the first time he had been playing
the legitimate business game. In the old days, such a panic, with the
accompanying extreme shrinkage of values, would have been a golden
harvest time for him. As it was, he watched the gamblers, who had
ridden the wave of prosperity and made preparation for the slump,
getting out from under and safely scurrying to cover or proceeding to
reap a double harvest. Nothing remained for him but to stand fast and
hold up.
He saw the situation clearly. When the banks demanded that he pay his
loans, he knew that the banks were in sore need of the money. But he
was in sorer need. And he knew that the banks did not want his
collateral which they held. It would do them no good. In such a
tumbling of values was no time to sell. His collateral was good, all
of it, eminently sound and worth while; yet it was worthless at such a
moment, when the one unceasing cry was money, money, money. Finding
him obdurate, the banks demanded more collateral, and as the money
pinch tightened they asked for two and even three times as much as had
been originally accepted. Sometimes Daylight yielded to these demands,
but more often not, and always battling fiercely.
He fought as with clay behind a crumbling wall. All portions of the
wall were menaced, and he went around constantly strengthening the
weakest parts with clay. This clay was money, and was applied, a sop
here and a sop there, as fast as it was needed, but only when it was
directly needed. The strength of his position lay in the Yerba Buena
Ferry Company, the Consolidated Street Railways, and the United Water
Company. Though people were no longer buying residence lots and factory
and business sites, they were compelled to ride on his cars and
ferry-boats and to consume his water. When all the financial world was
clamoring for money and perishing through lack of it, the first of each
month many thousands of dollars poured into his coffers from the
water-rates, and each day ten thousand dollars, in dime and nickels,
came in from his street railways and ferries.
Cash was what was wanted, and had he had the use of all this steady
river of cash, all would have been well with him. As it was, he had to
fight continually for a portion of it. Improvement work ceased, and
only absolutely essential repairs were made. His fiercest fight was
with the operating expenses, and this was a fight that never ended.
There was never any let-up in his turning the thumb-screws of extended
credit and economy. From the big wholesale suppliers down through the
salary list to office stationery and postage stamps, he kept the
thumb-screws turning. When his superintendents and heads of
departments performed prodigies of cutting down, he patted them on the
back and demanded more. When they threw down their hands in despair,
he showed them how more could be accomplished.
"You are getting eight thousand dollars a year," he told Matthewson.
"It's better pay than you ever got in your life before. Your fortune
is in the same sack with mine. You've got to stand for some of the
strain and risk. You've got personal credit in this town. Use it.
Stand off butcher and baker and all the rest. Savvee? You're drawing
down something like six hundred and sixty dollars a month. I want that
cash. From now on, stand everybody off and draw down a hundred. I'll
pay you interest on the rest till this blows over."
Two weeks later, with the pay-roll before them, it was:--
"Matthewson, who's this bookkeeper, Rogers? Your nephew? I thought
so. He's pulling down eighty-five a month. After--this let him draw
thirty-five. The forty can ride with me at interest."
"Impossible!" Matthewson cried. "He can't make ends meet on his salary
as it is, and he has a wife and two kids--"
Daylight was upon him with a mighty oath.
"Can't! Impossible! What in hell do you think I'm running? A home for
feeble-minded? Feeding and dressing and wiping the little noses of a
lot of idiots that can't take care of themselves? Not on your life.
I'm hustling, and now's the time that everybody that works for me has
got to hustle. I want no fair-weather birds holding down my office
chairs or anything else. This is nasty weather, damn nasty weather,
and they've got to buck into it just like me. There are ten thousand
men out of work in Oakland right now, and sixty thousand more in San
Francisco. Your nephew, and everybody else on your pay-roll, can do as
I say right now or quit. Savvee? If any of them get stuck, you go
around yourself and guarantee their credit with the butchers and
grocers. And you trim down that pay-roll accordingly. I've been
carrying a few thousand folks that'll have to carry themselves for a
while now, that's all."
"You say this filter's got to be replaced," he told his chief of the
water-works. "We'll see about it. Let the people of Oakland drink mud
for a change. It'll teach them to appreciate good water. Stop work at
once. Get those men off the pay-roll. Cancel all orders for material.
The contractors will sue? Let 'em sue and be damned. We'll be busted
higher'n a kite or on easy street before they can get judgment."
And to Wilkinson:
"Take off that owl boat. Let the public roar and come home early to
its wife. And there's that last car that connects with the 12:45 boat
at Twenty-second and Hastings. Cut it out. I can't run it for two or
three passengers. Let them take an earlier boat home or walk. This is
no time for philanthropy. And you might as well take off a few more
cars in the rush hours. Let the strap-hangers pay. It's the
strap-hangers that'll keep us from going under."
And to another chief, who broke down under the excessive strain of
retrenchment:--
"You say I can't do that and can't do this. I'll just show you a few
of the latest patterns in the can-and-can't line. You'll be compelled
to resign? All right, if you think so I never saw the man yet that I
was hard up for. And when any man thinks I can't get along without
him, I just show him the latest pattern in that line of goods and give
him his walking-papers."
And so he fought and drove and bullied and even wheedled his way along.
It was fight, fight, fight, and no let-up, from the first thing in the
morning till nightfall. His private office saw throngs every day. All
men came to see him, or were ordered to come. Now it was an optimistic
opinion on the panic, a funny story, a serious business talk, or a
straight take-it-or-leave-it blow from the shoulder. And there was
nobody to relieve him. It was a case of drive, drive, drive, and he
alone could do the driving. And this went on day after day, while the
whole business world rocked around him and house after house crashed to
the ground.
"It's all right, old man," he told Hegan every morning; and it was the
same cheerful word that he passed out all day long, except at such
times when he was in the thick of fighting to have his will with
persons and things.
Eight o'clock saw him at his desk each morning. By ten o'clock, it was
into the machine and away for a round of the banks. And usually in the
machine with him was the ten thousand and more dollars that had been
earned by his ferries and railways the day before. This was for the
weakest spot in the financial dike. And with one bank president after
another similar scenes were enacted. They were paralyzed with fear,
and first of all he played his role of the big vital optimist. Times
were improving.
Of course they were. The signs were already in the air. All that
anybody had to do was to sit tight a little longer and hold on. That
was all. Money was already more active in the East. Look at the
trading on Wall Street of the last twenty-four hours.
That was the straw that showed the wind. Hadn't Ryan said so and so?
and wasn't it reported that Morgan was preparing to do this and that?
As for himself, weren't the street-railway earnings increasing
steadily? In spite of the panic, more and more people were coming to
Oakland right along. Movements were already beginning in real estate.
He was dickering even then to sell over a thousand of his suburban
acres. Of course it was at a sacrifice, but it would ease the strain
on all of them and bolster up the faint-hearted. That was the
trouble--the faint-hearts. Had there been no faint-hearts there would
have been no panic. There was that Eastern syndicate, negotiating with
him now to take the majority of the stock in the Sierra and Salvador
Power Company off his hands. That showed confidence that better times
were at hand.
And if it was not cheery discourse, but prayer and entreaty or show
down and fight on the part of the banks, Daylight had to counter in
kind. If they could bully, he could bully. If the favor he asked were
refused, it became the thing he demanded. And when it came down to raw
and naked fighting, with the last veil of sentiment or illusion torn
off, he could take their breaths away.
But he knew, also, how and when to give in. When he saw the wall
shaking and crumbling irretrievably at a particular place, he patched
it up with sops of cash from his three cash-earning companies. If the
banks went, he went too. It was a case of their having to hold out.
If they smashed and all the collateral they held of his was thrown on
the chaotic market, it would be the end. And so it was, as the time
passed, that on occasion his red motor-car carried, in addition to the
daily cash, the most gilt-edged securities he possessed; namely, the
Ferry Company, United Water and Consolidated Railways. But he did this
reluctantly, fighting inch by inch.
As he told the president of the Merchants San Antonio who made the plea
of carrying so many others:--
"They're small fry. Let them smash. I'm the king pin here. You've got
more money to make out of me than them. Of course, you're carrying too
much, and you've got to choose, that's all. It's root hog or die for
you or them. I'm too strong to smash. You could only embarrass me and
get yourself tangled up. Your way out is to let the small fry go, and
I'll lend you a hand to do it."
And it was Daylight, also, in this time of financial anarchy, who sized
up Simon Dolliver's affairs and lent the hand that sent that rival down
in utter failure. The Golden Gate National was the keystone of
Dolliver's strength, and to the president of that institution Daylight
said:--
"Here I've been lending you a hand, and you now in the last ditch, with
Dolliver riding on you and me all the time. It don't go. You hear me,
it don't go. Dolliver couldn't cough up eleven dollars to save you.
Let him get off and walk, and I'll tell you what I'll do. I'll give
you the railway nickels for four days--that's forty thousand cash. And
on the sixth of the month you can count on twenty thousand more from
the Water Company." He shrugged his shoulders. "Take it or leave it.
Them's my terms."
"It's dog eat dog, and I ain't overlooking any meat that's floating
around," Daylight proclaimed that afternoon to Hegan; and Simon
Dolliver went the way of the unfortunate in the Great Panic who were
caught with plenty of paper and no money.
Daylight's shifts and devices were amazing. Nothing however large or
small, passed his keen sight unobserved. The strain he was under was
terrific. He no longer ate lunch. The days were too short, and his
noon hours and his office were as crowded as at any other time. By the
end of the day he was exhausted, and, as never before, he sought relief
behind his wall of alcoholic inhibition. Straight to his hotel he was
driven, and straight to his rooms he went, where immediately was mixed
for him the first of a series of double Martinis. By dinner, his brain
was well clouded and the panic forgotten. By bedtime, with the
assistance of Scotch whiskey, he was full--not violently nor
uproariously full, nor stupefied, but merely well under the influence
of a pleasant and mild anesthetic.
Next morning he awoke with parched lips and mouth, and with sensations
of heaviness in his head which quickly passed away. By eight o'clock he
was at his desk, buckled down to the fight, by ten o'clock on his
personal round of the banks, and after that, without a moment's
cessation, till nightfall, he was handling the knotty tangles of
industry, finance, and human nature that crowded upon him. And with
nightfall it was back to the hotel, the double Martinis and the Scotch;
and this was his program day after day until the days ran into weeks.