The Great Gold Conspiracy -- an excerpt from 'The Money Men'

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-- An excerpt --

The Great Gold Conspiracy
from "The Money Men"
by H.W. Brands
(W.W. Norton & Co., New York, 2006)

... The Erie [Railroad] War was simply practice for a more ambitious assault by [Jay] Gould and [Jim] Fisk. The target this time was no mere corporation but the money supply of the United States. America’s money still bore the marks of the suspension of specie payments in 1861 and the issue of greenbacks the following year. Since then the country had operated a dual system: greenbacks for domestic commerce, gold for the payment of customs duties and for international transactions. (Silver had effectively disappeared from circulation during the California gold rush, which made gold relatively cheaper than silver and caused people to hoard the latter.)

The two systems intertwined in the Gold Room, a special section of the New York exchange where speculators and persons with pedestrian need for gold traded the yellow metal for greenbacks. Within weeks of its opening in 1862 the Gold Room developed a reputation as the den of the most dangerous transactions. One regular called it "a cavern full of dank and noisome vapors" where "the deadly carbonic acid was blended with the fumes of stale smoke and vinous breaths." A journalist wrote, "Imagine a rat pit in full blast, with 20 or 30 men ranged around the rat tragedy, each with a canine under his arm, yelling and howling at once." The center of the room contained a stony Cupid spewing water into the air. "The artistic conception is not appropriate," the journalist complained. "Instead of a Cupid throwing a pearly fountain into the air there should have been a hungry Midas turning everything to gold and starving from sheer inability to eat."

As during the Civil War, the greater value of gold compared to paper resulted in a postwar premium for the former, which during 1868 and early 1869 ranged from about 35 to 42 -- meaning that 135 to 142 paper dollars were required to purchase 100 gold dollars. The variation in prices tempted speculators to bet on their direction. "Bulls" took "long" positions in gold -- they purchased gold and hoped for a rise in price, after which they would sell and pocket the profit. "Bears" took "short" positions -- sold gold they had borrowed, anticipating a price fall before they had to buy the gold back to repay their lenders. The bears, or shorts, were generally thought to be in the more precarious position, for if the price rose between the short sale and the required repayment, they had to swallow the loss or renege on their contracts. Put differently, the largest loss a long buyer could suffer was the amount of the purchase price (since the price of gold, like that of other commodities, couldn’t fall below zero), while a short seller could lose an unlimited amount (there being no upper limit on prices).

In this regard gold was no different from any other stock or commodity. But in another sense gold was very different. Gyrations in the price of pork bellies or Erie shares affected adjacent sectors of the economy but rarely threatened the financial system as a whole. By contrast, gyrations in gold -- which were nothing more or less than surges and plunges in the value of the dollar -- discombobulated the entire economy. For this reason the federal government treated the gold market differently than it treated the market in shares and commodities. The government held a reserve supply of gold. If the gold price rose abruptly, the government might sell gold and drive the price down. If the gold price dropped, it could buy gold and pull the price back up.

Various parties preferred different price levels for gold. Importers liked low prices, partly because the low prices eased the burden of paying their import duties, but mostly because cheap gold corresponded to a strong dollar, making imports less expensive. Conversely, exporters desired high prices for gold, which meant a cheap dollar and a larger foreign market for the goods they shipped abroad. The speculators-the bulls and bears-cared less about the absolute price of gold than about changes in price.

Jay Gould's interests in gold combined those of the exporter and of the speculator. Gould wasn't an exporter himself, but many of the customers of his Erie Railroad were, and when demand for their products -- typically grain -- increased, so did the traffic on the railroad. This export interest, he said, was what attracted his attention to the gold price during the spring and summer of 1869. "Business got very dull after the inauguration," he told a congressional committee, referring to the inauguration of Ulysses Grant. "Gold went down to about 30 and stopped the movement of produce. Our business in consequence fell off very much. ... I had a careful examination made, and I found that with gold at 40 or 45, Americans would supply the English market with breadstuffs, but that it would require gold to be at that price to equalize our high-priced labor and our rail transportation with the low-priced labor and the water transportation from the Mediterranean. With gold below 40 we could not export, but with gold above 45 we would get the trade."

Though the committee questioning Gould had charge of banking and commerce, the exchange-rate theories that underlay greenback-gold conversions and connected them to foreign trade were sufficiently new that the members insisted that Gould elaborate. "How will the rise in gold give American produce the foreign market?" Chairman James Garfield, a Republican of Ohio, asked.

"The farmers of the West are pretty rich," Gould replied. "And they sell very reluctantly unless they get a profit upon their products. Labor and rail transportation are high, and rather than do business at a loss they will let their produce lie. But as the price of gold goes up the price of wheat goes up. Last spring, when the Secretary" -- of the Treasury, Hugh McCulloch -- "sold gold, we had in one day orders stopped for 400 cars that were ordered to ship grain. The sale of gold fell like a pall upon the country."

Gould explained that he hoped to lift the pall by pushing up the price of gold. "I bought gold along in the spring," he told the committee. The bears had been beating down gold -- spreading rumors of bad business ahead -- and Gould decided he had to act. "I took it at their price, and put it up 4 or 5 percent, which started my business a little, and I sold my gold out." But then the new secretary of the treasury, George Boutwell, began selling gold. "He went in and threw a large amount on the market, taking in greenbacks for it and making money very stringent. That stopped business the second time, and it got so that we were not doing anything. ... I went in a second time. That must have been in July or August. At that time the fact was established that we had an immense harvest and that there was going to be a large surplus of breadstuffs, either to rot or to be exported."

The committee's interest in Gould reflected reports that he had engaged in a speculative conspiracy. Chairman Garfield inquired about Gould’s associates in the gold purchases, mentioning two brokers in particular. Gould denied a conspiracy but explained a simple fact of market life. "We bought gold together, and each would take his gold and pay for it. The reason we bought it together was that if two or three parties were in the market buying gold at the same time they would bid it up, but if only one party bid for the whole, he would buy cheap. ... We bought it together and divided it pro rata."

Gould added that the gold market was filled with "a lot of speculators," starting with the brokers who handled gold orders. "When a man goes into the market who they think has some power, they watch him, and if he gives them an order to buy a hundred thousand dollars, they will first buy three or four hundred thousand dollars on their own account." This afforded them the benefit of any price rise but it also made their client’s purchase more expensive. "So, in order to conceal the movement, we would sometimes give an order to sell while we were really buying."

Some committee members must have wondered at this explanation. If Gould's purpose, as he had stated, was to push up the price of gold, he should have been happy for others to know that he and his partners were buying. But none of the members pressed him on it, and the questioning turned to attempts Gould might have made to influence public policy. He answered carefully but tantalizingly. "I supposed it was the policy of the administration to let gold work up until after the fall crops were moved. And I had good reason to suppose that was to be so, or I should never have gone into this movement."

Garfield pressed him to explain further. Gould responded that he had received a visit from Abel Corbin, the new husband of President Grant’s sister. Gould had known Corbin casually for some time. "He came to see me, wanted to make some money, and asked my opinion." Garfield asked Gould who had initiated the meeting. Gould’s memory failed. "It does not occur to me at this moment whether I sought him or he sought me. I used to meet him occasionally."

Gould at once realized this sounded evasive, especially since he had declared, only moments before, that his memory had always sufficed to let him dispense with ledgers and other accounts in recording his business. "I carried the whole thing in my head. ... I never kept a book in my life." So now he expanded on his relationship with Corbin, whom he described as "a very shrewd old gentleman, much more far-seeing than the newspapers give him credit for."

Gould said he had told Corbin of his theory of gold prices and exports. "He saw at a glance the whole case, and said that he thought it was the true platform to stand on; that whatever the government could do legitimately and fairly to facilitate the exportation of breadstuffs and produce good prices for the products of the West, they ought to do. He was anxious that I should see the president." Corbin arranged a meeting between Grant and Gould at his own house on a day when Grant was visiting.

This first meeting was uneventful, but it led to another, in June aboard one of the packet boats operated by the Erie between New York and Boston. The president was traveling north to attend a peace jubilee commemorating the victory in the Civil War, and Gould, Fisk, and some others joined him en route. "He was our guest," Gould explained. "We had supper about 9 or 10 o’clock. ... At this supper the question came up about the state of the country, the crops, the prospects ahead, etc. The president was a listener; the other gentlemen were discussing."

Fisk, when questioned by the committee separately, offered a different version of the president’s participation. "He entered into the conversation with a good deal of spirit," Fisk said.

But Gould and Fisk agreed that Grant gave them no encouragement. "He remarked that he thought there was a certain amount of fictitiousness about the prosperity of the country," Gould said, "and that the bubble might as well be tapped in one way as another." Grant then asked Gould’s opinion. "I remarked that I thought if that policy was carried out, it would produce great distress, and almost lead to civil war; it would produce strikes among the workmen, and the workshops, to a great extent, would have to be closed. The manufactories would have to stop. I took the ground that the government ought to let gold alone, and let it find its commercial level -- that, as a matter of fact, it ought to facilitate an upward movement of gold in the fall." The president was not convinced. "The interview ... was a wet blanket," Gould declared. "We supposed from that conversation that the president was a contractionist."

Fisk drew the same conclusion. "When we got to Boston ... the prospect did not look promising," he said.

A less resourceful person than Gould might have abandoned his cause at this point. The president could break the market for gold at any moment simply by ordering the Treasury to sell. Yet Gould decided to play for time, hoping the president would come around. In August he planted an unbylined story in The New York Times intimating inside knowledge of the administration's financial plans and declaring, "At a time of the year so critical to producers, the president will not withdraw currency from the channels of trade and commerce; he will not send gold into the market and sell it for currency."

Gould got Corbin to arrange another meeting with Grant, which proved far more encouraging than the earlier session. "The president had changed his views," Gould recounted. "He was satisfied that the country had a very bountiful harvest; that there was to be a large surplus; that unless we could find a large market abroad for that surplus it would put down prices here. ... He remarked that the government would do nothing during the fall months of the year to put down the price of gold or make money tight. On the contrary, they would do everything they could to facilitate the movement of breadstuffs. He seemed to take a very deep interest in it; it seemed to have been a matter of study with him."

Encouraged, Gould pressed forward. He secured Corbin’s continued cooperation by purchasing $1.5 million of gold for his account, with the consequence for Corbin that every point’s rise in the gold price put more than $10,000 in his pocket. Corbin helped him arrange the appointment of Daniel Butterfield to be assistant Treasury secretary for New York, with oversight of gold sales. Gould apparently purchased gold for Butterfield too, although Butterfield later denied it.

One might have expected Gould to keep these arrangements secret lest word get out that he was trying to bribe the government. In fact he did just the opposite, feeding the news to the rumor mongers of Wall Street. Gould didn’t know whether he could count on the support of Corbin and Butterfield but he wanted the world to think he could, that he had connections high inside the administration. He apparently started a story that his influence reached into the Executive Mansion itself. Mrs. Grant was said to have a gold account with Gould. No records ever surfaced that showed she did, but Fisk testified that Corbin had told him directly "that Mrs. Grant had an interest ... that Mr. Corbin held for himself about two millions of gold, five hundred thousand of which was for Mrs. Grant."

As the rumors churned, Gould bought gold. His immediate purpose was what he had said all along: to depress the dollar enough to get the crops moving and keep his rail cars full. But a second objective gradually emerged: to corner the gold market. Corners come in shades and flavors, but at the heart of any corner is a plot by a single person or coalition to gain control of enough of a stock or commodity to prevent fulfillment of obligations in that item. Short sellers in the stock or commodity have to buy it to meet their commitments; if the cornerer controls so much that the short sellers can’t find what they need, the cornerer can dictate price or terms of settlement. As Gould bought more and more gold, he realized he might be able to corner the yellow metal, which would be the coup of any speculator's lifetime.

Gould never admitted to any such plan. "I did not want to buy so much gold," he told the congressional investigators. "I never intended to purchase more than four or five millions of gold. ... I had no idea of cornering it." He said he simply hoped to push gold up long enough to move the harvest. Then he would sell, with luck while gold was still high, and let it fall back to its previous level. "My theory was that if gold could stay at 40 or 45 till after the 1st of January, we could export about a hundred millions of produce and that would turn the current of exchange in our favor. ... Gold would flow in here from Paris and London, and that would create a downward tendency in gold, and it would fall just as a ripe apple." By then he would be out of gold and into something else.

But the gold bears got in the way, he said. "These fellows went in and sold short, so that in order to keep it up, I had to buy or else back down and show the white feather."

Perhaps Gould was telling the truth. Perhaps the gold corner wasn't his initial idea -- although the secrecy surrounding his early purchases suggests more than an effort to boost gold prices. But the longer his position in gold grew, the more feasible a corner appeared and, for that reason, the more attractive. He laid his plans carefully. He cozied up to Daniel Butterfield, who didn’t determine Treasury policy but could alert Gould to any policy change. The greatest threat to Gould's scheme was a decision by the administration to sell gold. That decision would be transmitted to Butterfield in New York, who could tip Gould in advance and allow him to get out of the market before his rivals did.

To keep the administration from selling, Gould approached the president again, this time obliquely. In mid-September he had Corbin write a letter to Grant, who was vacationing in western Pennsylvania. The letter, without revealing Corbin's personal interest in the matter, urged the president to let the market determine the price of gold. Gould asked Fisk, who had begun buying gold too, to arrange for a special courier to deliver Corbin's letter. The courier, W.O. Chapin, rode a train to Pittsburgh and then hired a carriage for the final 30 miles to Grant's vacation residence. He arrived while Grant was playing croquet with Horace Porter, his private secretary. "I was told that there was a gentleman there who wanted to see me," Porter testified. "I sent him word to wait till we had finished the game."

A few minutes later Porter and Grant came up to the house, with the president taking a seat on the porch and Porter going inside to meet Chapin. Chapin carried a letter from Corbin to Porter, introducing Chapin and explaining that he had a message to deliver to the president. Porter asked Grant to enter the parlor. Chapin produced the letter from Corbin to Grant, which the president read carefully. Chapin asked if there was any reply. Grant said there was none.

Chapin had instructions from Fisk to telegraph him upon completion of the assignment. Chapin hurried to the nearest telegraph office and sent a message: "Letters delivered all right." Fisk apparently parsed the reply differently than Chapin intended, concluding that "all right" constituted Grant’s response to Corbin's plea to keep the government out of the market. On this premise he and Gould continued their gold purchases.

But Gould soon discovered that all was not right. Grant realized only after Chapin left that he wasn’t the ordinary postal delivery clerk, and as he began to wonder why Corbin would go to the trouble of sending a man clear from New York, he pieced together Corbin’s involvement in the gold affair. Mrs. Grant happened to be writing to Mrs. Corbin a short while later, and Grant suggested that she tell her sister that rumors were linking her husband to gold speculators in New York, and that these rumors were greatly distressing the president.

Julia Grant's letter reached Virginia Corbin the following day. She shared the message with her husband, who went to Gould in alarm. Corbin said he had to get out of the market at once. "He figured up that his gold, at the price it then stood, if sold would give him about $150,000 profit, and he wanted me to take the gold off his hands," Gould recounted. Gould resisted, urging Corbin to be brave. He said that he’d guarantee Corbin's current profit, but that to throw the gold on the market just then would give the plan away. And Corbin must keep absolutely quiet about the letter from Julia Grant. "I am undone if that letter gets out," he told Corbin.

What Gould didn't tell Corbin was that he was nearly undone already. Grant knew something shady was going on and he certainly wouldn't tolerate a gold corner, which would throw the country’s entire financial structure into turmoil. The only question was when Grant would give the order to dump the Treasury gold onto the market.

Realizing the corner was now impossible, Gould pondered how to extricate himself. So far only he and Corbin knew what Grant knew. Corbin had no reason to share the intelligence. And Gould saw no reason to share it, either, not even with Fisk. Though the two men were partners, they didn't do everything together. In the gold project they apparently kept separate accounts, acting more as allies than partners. Gould decided that the only way to save himself was to sacrifice Fisk -- to let Fisk continue to think everything was all right. Perhaps Gould reasoned that if he himself survived the debacle that was increasingly inevitable, he could make it up to Fisk in the future.

Gould began selling -- slowly, stealthily, covering his tracks with small purchases to give the impression he was still a buyer -- even as he let Fisk drive the price upward. Fisk relished his role as the leading bull and played the part to perfection. During the fourth week of September he drove gold higher and higher. On Thursday, September 23, he rode from the opera house he and Gould had converted into offices for the Erie to the Gold Room, where he taunted the bears and personally urged his brokers to buy at any price. As the price topped 140 he offered to wager it would pass 145 before day's end.

The directors of the Gold Room had recently installed an electric indicator that showed the current price; with each tick that the pointer moved upward, the bears suffered the more, while the bulls -- including scores of speculators who had jumped on the Gould-Fisk bandwagon -- celebrated their mounting good fortune. "The bear party at times seemed to be perfectly frantic while undergoing punishment at the hands of the exultant and defiant bulls," a financial correspondent related. "And as the roar of battle and the screams of the victims resounded through New Street, it seemed as though human nature was undergoing torments worse than any that Dante ever witnessed in hell."

By the close of business Thursday the market was in disarray from the large volume of sales. A typical day's sale was $70 million; that day it reached nearly $240 million. The ledger men lagged hours behind the transactions. Fisk retired to the Opera House to toast his good fortune with Gould, who proved considerably more subdued. In another man, Fisk might have suspected something. But Gould was famous for keeping his own counsel, and he kept it now. "I had my own views about the market, and had my own fish to fry," he remarked afterward. "Very likely I listened to what was said, but it went in one ear and out of the other. I was all alone, so to speak, in what I did, and I did not let any of those people know exactly how I stood."

Fisk and the bulls plotted how to squeeze the bears most painfully. The pool held commitments for delivery of more than $100 million at a time when barely $15 million in gold and gold certificates circulated in New York outside the vaults of the subtreasury there. Someone suggested publishing the names of the shorts -- a group that included more than two hundred of the city’s most prominent bankers, brokers, and merchants -- and the amounts they owed. The bad publicity alone would bring many to their knees, and they would beg to settle at whatever terms the bulls required. But someone else suggested that such a course might constitute -- or indicate -- criminal conspiracy. And there was no telling what the desperate bears might do by way of personal injury to particular bulls. The extortion scheme was shelved.

But it scarcely seemed necessary. With the commitments so far ahead of the available supply, the corner seemed assured. The bulls slept the slumber of the confident while the bears prepared their financial wills.

The next morning's papers predicted carnage worse than the day before. The New York Times declared a "practical corner in gold" and repeated the rumors the bulls had been spreading. "The highest official in the land was quoted as being with them, and he, of course, controls the action of the Secretary of the Treasury and the New York assistant treasurer." The Times questioned the rumors but observed that their effect had been to produce the widespread conviction that the Grant administration would let the market run its course and would not sell Treasury gold. The consequence was that commodity and exchange markets were "paralyzed by this heavy rise and corner in gold, through a sheer gambling operation." The economy verged on ruin. "The government is scandalized ... the public credit damaged ... the general trade of the country agitated. ... When or where the trouble is to end we have no present means of telling."

Long before the Gold Room opened that Friday morning the bulls began trading on the curb outside; at the 10 o’clock bell the gold indicator leaped instantly from 143 to 150. "Take all that you can get," Fisk ordered his brokers. The price lurched upward again, to 155.

The tumult immediately spread to the stock exchange. The gold speculation had sucked funds out of scores of banks, which now teetered on insolvency. Brokers were even more exposed, having fewer resources and comparatively larger speculative accounts. One stockbroker was so maddened he threatened to shoot one of the gold bulls. The bull responded by striding into the stock exchange, tossing off his coat, tearing open his shirt, and daring anyone to fire. When no one did, he returned to the Gold Room and triumphantly resumed his trading.

Gould and Fisk continued to work at cross-purposes, the former selling silently, the latter buying noisily. "Take all you can get at 160," Fisk shouted. The bulls predicted gold would reach 200, and the price continued to climb.

A threat to the bulls developed when bank examiners arrived at the Tenth National Bank, the institution Gould and Fisk had purchased to finance their speculation. As they lacked cash to fund their purchases, they paid with certified checks on the Tenth National. The checks far exceeded the bank's existing ability to pay, but if the speculation succeeded they would be covered before anyone found out. The arrival of the examiners -- which may or may not have been mere coincidence -- threatened to reveal the sham behind the checks. But whether the examiners were crooked or merely incompetent, they failed to spot the fraud being committed beneath their noses.

From Washington the Grant administration monitored the market closely. Grant had returned from Pennsylvania the previous afternoon and he called for Treasury Secretary Boutwell that evening. Together they read the telegraphed reports from New York and came to a firm conclusion. "If gold advanced materially the next day," Boutwell explained afterward, "it would be our duty to sell." How much Grant told Boutwell regarding his suspicions of conspiracy is unclear. Given that the only conspirator he knew about at this time was his brother-in-law, he might well have said nothing. Boutwell remarked later that if the contest had been simply an ordinary struggle among speculators, the administration might have kept hands off. Any decision doubtless would have been interpreted as favoring one side or the other. "The president was anxious, as I was, that we should not interfere unless it seemed to be an absolute necessity." But they seemed to have no choice. "We thought the business of the country was in danger. ... If banking institutions should become involved and break, we might have a repetition of such disasters as we had in 1857" -- when the Central America had sunk and taken Wall Street with it.

At 11 o'clock Friday morning Boutwell received a rush telegram from Daniel Butterfield in New York. "Gold over 160," Butterfield wrote. "Moving up every hour." Boutwell returned to the White House. "The time had come when we must interfere," he recalled thinking. Grant agreed. "He expressed the opinion ... that we ought to sell $5 million." Boutwell had judged $3 million sufficient; they split the difference. Boutwell sent a telegram by Western Union to Butterfield directing him to announce the sale of $4 million in federal gold. Then -- "apprehending that there might be trouble, or that some interested party might get possession of it [the Western Union telegram]" -- the secretary sent the same message by a second line, operated by the Franklin Telegraph Co.

The first telegram left Washington at 11:42, the second at 11:45. Standard time zones hadn’t been invented yet and in those days New York was 12 minutes ahead of Washington. Apparently the Franklin company was more efficient than Western Union, for the message sent by the former reached the New York subtreasury at 12:05 local time, while that sent by the latter didn’t arrive until 12:10. But both were slower than the financial grapevine. Somehow the news of the Treasury sale reached the Gold Room ahead of either telegram. Likely some speculators had spies in one of the telegraph offices in Washington; if they didn’t actually read Boutwell's message, they could have inferred its gist from the mere arrival of a messenger from the Treasury. Whatever the mode of transmission, the word flashed to the Gold Room. A reporter covering the scene described the climax of the bull market, and the events that followed:

* * *

"Amid all the noise and confusion the penetrating voices of the leading brokers of the clique are still heard advancing the price at each bid, and increasing the amount of their bids at each advance, until at last, with voice overtopping the bedlam below, the memorable bid burst forth, '160 for any part of five millions.' ... The noise was hushed. Terror became depicted on every countenance. Cool, sober men, looked at one another, and noted the ashy paleness that spread all over. Even those who had but little or no interest at stake were seized with the infection of fear and were conscious of a great evil approaching. And from the silence again came forth that shrieking bid, '160 for five millions,' and no answer. '161 for five millions.' '162 for five millions.' Still no answer. '162 for any part of five millions.'

"And a quiet voice said, 'Sold one million at 162.'

"That quiet voice broke the fascination. The bid of 162 was not renewed. But 161 was again bid for a million, and the same quiet voice said, 'Sold.' And the bid of 161 was not renewed. But 160 was again bid for five millions. Then it dimly dawned upon the quicker-witted that for some reason or other the game was up. As if by magnetic sympathy the same thought passed through the crowd at once. A dozen men leapt furiously at the bidder, and claimed to have sold the whole five millions. To their horror the bidder stood his ground and declared he would take all. But before the words had fairly passed his lips, before the terror at his action had had time to gain men's hearts, there was a rush amid the crowd. New men, wild with fresh excitement, crowded to the barriers.

"In an instant the rumor was abroad: The Treasury is selling.

"Quick as thought, men realized that it was not safe to sell to the clique brokers. Scarcely anyone now wanted to buy. All who had bought were mad to sell at any price, but there were no buyers. In less time than it takes to write about it, the price fell from 162 to 135. The great gigantic bubble had burst, and half Wall Street was involved in ruin."

* * *

The ruined half now turned on those they perceived as the authors of their calamity: Fisk and Gould. The partners were forced to flee the financial district for their lives. An eyewitness contended that had the masterminds of the gold corner been caught by the victims of its collapse, "the chances were that the lamppost near by would have very soon been decorated with a breathless body." Gould and Fisk made it to the Opera House, where they took refuge behind a cordon of bodyguards retained for just such emergencies.

What the partners said to each other, as they caught their breath in their marble sanctum, only they knew. "Nothing is lost save honor," Gould had pronounced at a critical moment of the Erie War; perhaps he encouraged Fisk similarly now. Or perhaps they were too busy fending off the maddened investors to pause for reflection.

Fisk thought Gould looked terrible. "He has no courage at all," Fisk told an associate. "He has sunk right down. There is nothing left of him but a heap of clothes and a pair of eyes."

At some later point, Fisk discovered that Gould had anticipated the break and been secretly selling, but for the time being, as the panic from the collapsed corner spread from the money market to the stock market and rippled into the broader economy, they continued their separate affairs. "It was each man drag out his own corpse," Fisk said.