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Consolidated Stove. When they came over to see me I told them
that if they formed a syndicate to put up some cash and gave me
a call on their stock at a little above the market I would do
what I could to make a market. They promptly asked me how much
money would be required.
I answered, "You've had that stock a long time and you can't do
a thing with it. Between the three of you you've got two hundred
thousand shares, and you know very well that you haven't the
slightest chance of getting rid of it unless you make a market
for it. It's got to be some market to absorb what you've got to
give it, and it will be wise to have enough cash to pay for
whatever stock it may be necessary to buy at first. It's no use
to begin and then have to stop because there isn't enough money.
I suggest that you form a syndicate and raise six millions in
cash. Then give the syndicate a call on your two hundred
thousand shares at 40 and put all your stock in escrow. If
everything goes well you chaps will get rid of your dead pet and
the syndicate will make some money."
As I told you before, there had been all sorts of rumours
about my stock-market winnings. I suppose that helped, for
nothing succeeds like success. At all events, I didn't have to
do much explaining to these chaps. They knew exactly how far
they'd get if they tried to play a lone hand. They thought mine
was a good plan. When they went away they said they would form
the syndicate at once.
They didn't have much trouble in inducing a lot of their
friends to join them. I suppose they spoke with more assurance
than I had of the syndicate's profits. From all I heard they
really believed it, so theirs were no conscienceless tips. At
all events the syndicate was formed in a couple of days. Kane,
Gordon and Wolff gave calls on the two hundred thousand shares
at 4o and I saw to it that the stock itself was put in escrow,
so that none of it would come out on the market if I should
put up the price. I had to protect myself. More than one
promising deal has failed to pan out as expected because the
members of the pool or clique failed to keep faith with one
another. Dog has no foolish prejudices against eating dog in
Wall Street. At the time the second American Steel and Wire
Company was brought out the insiders accused one another of
breach of faith and trying to unload. There had been a
gentlemen's agreement between John W. Gates and his pals and the
Seligmans and their banking associates. Well, I heard somebody
in a broker's office reciting this quatrain, which was said to
have been composed by John W. Gates:
The tarantula jumped on the centipede's back
And chortled with ghoulish glee:
"I'll poison this murderous son o f a gun.
If I don't he'll poison me!"
Mind you, I do not mean for one moment to imply that any of
my friends in Wall Street would even dream of doublecrossing me
in a stock deal. But on general principles it is just as well to
provide for any and all contingencies. It's plain sense,
After Wolff and Kane and Gordon told me that they had
formed their syndicate to put up six millions in cash there was
nothing for me to do but wait for the money to come in. I had
urged the vital need of haste. Nevertheless the money came in
driblets. I think it took four or five installments. I don't
know what the reason was, but I remember that I had to send out
an S O S call to Wolff and Kane and Gordon.
That afternoon I got some big checks that brought the cash
in my possession to about four million dollars and the promise
of the rest in a day or two. It began at last to look as though
the syndicate might do something before the bull market passed
away. At best it would be no cinch, and the sooner I began work
the better. The public had not been particularly keen about new
market movements in inactive stocks. But a man could do a great
deal to arouse interest in any stock with four millions in cash.
It was enough to absorb all the probable offerings. If time
urged, as I had said, there was no sense in waiting for the
other two millions. The sooner the stock got up to 50 the better
for the syndicate. That was obvious.
The next morning at the opening I was surprised to see that
there were unusually heavy dealings in Consolidated Stove. As I
told you before, the stock had been waterlogged for months. The
price had been pegged at 37, Jim Barnes taking good care not to
let it go any lower on account of the big bank loan at 35. But
as for going any higher, he'd as soon expect to see the Rock of
Gibraltar shimmying across the Strait as to see Consolidated
Stove do any climbing on the tape.
Well, sir, this morning there was quite a demand for the
stock, and the price went up to 39. In the first hour of the
trading the transactions were heavier than for the whole pre-
vious half year. It was the sensation of the day and affected
bullishly the entire market. I heard afterwards that nothing
else was talked about in the customers' rooms of the commission
houses.
I didn't know what it meant, but it didn't hurt my feelings
any to see Consolidated Stove perk up. As a rule I do not have
to ask about any unusual movement in any stock because my
friends on the floor-brokers who do business for me, as well as
personal friends among the room traders -- keep me posted. They
assume I'd like to know and they telephone me any news or gossip
they pick up. On this day all I heard was that there was
unmistakable inside buying in Consolidated Stove. There wasn't
any washing. It was all genuine. The purchasers took all the
offerings from 37 to 39 and when importuned for reasons or
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