This week, in honor of the Dow Jones Average hitting its lowest point in twelve years, I though it fitting to pull out Thomas Nast's famous 1869 cartoon tribute to Wall Street following that year's front-page financial debacle. It was in September 1869 that young Jay Gould and James Fisk Jr. perpetrated perhaps the single most audatious financial play in American history, their attempt to corner the national gold supply.
Gould and Fisk almost pulled it off after bribing dozens of government officials and buying over $100 million in gold calls. The bubble burst on Black Friday, September 24, when gold prices collapsed from 160 to 130 in about ten minutes. The result was a cascade of ruin, dozens of bankruptcies, panic in the stock market, frozen trade and credit, and the first major scandal for the new administration of President Ulysses Grant.
Of course, when Fisk and Gould attempted their corner back in 1869, it was decades before the invention of our modern system of financial regulation. There was no SEC, no CFTC, no Federal Reserve, no effective bank regulators, no honest court system (Boss Tweed still ran tings in NYC), and the rest.
Today, 140 years later, what's our excuse?
Read more about the Fisk-Gould corner in my book THE GOLD RING.
Meanwhile, I hope your money (or whateverr part of it you have left) is safe. --KenA
3 comments:
Hmmm, I wonder what 1869 did to Gould's and Fisk's reputations. Where they vilified for causing ruin or lionized for their daring?
I suppose I should read your book to find out!
They certainly were vilified, Gould would forever be known as the "skunk of Wall Street," and would receive the blame for every market mishap that came after. Interestingly though, new research is changing this perception . . . somewhat. I can't help but think that secretly though, among his peers, he was lionized and had he gotten away with it - envied. I love the Gilded Age!
I heard Mephistopheles of wall street. Also, any time I hear Jay Gould's name, its by a historian who is trying to point out how f'd up the gilded age was.
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