My Adventures with Your Money

My Adventures with Your Money

Author:
George Graham Rice
Author:
George Graham Rice
Format:
epub
language:
English

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Author: Rice, George Graham
Speculation
Mineral industries — Finance
My Adventures with Your Money

MY ADVENTURES WITH
YOUR MONEY

BY
GEORGE GRAHAM RICE

RICHARD G. BADGER
THE GORHAM PRESS
BOSTON
Copyright, 1911, by The Ridgway Company
Copyright, 1913, by Richard G. Badger
All rights reserved
The Gorham Press, Boston, Mass., U.S.A.


To The American Damphool Speculator, surnamed the American Sucker, otherwise described herein as The Thinker Who Thinks He Knows But Doesn’t—greetings!
This book is for you! Read as you run, and may you run as you read.
G. G. R.
New York, March 15, 1913.


CONTENTS

    PAGE
I THE RISE AND FALL OF MAXIM & GAY 11
The Birth of an Idea to Coin Money.
The Higher Mathematics of the Operation.
How “The One Best Bet” Was Coined.
Real Inside Turf Information.
The Public Asks to Be Mystified.
Prestige Restored by a Clerk’s Ruse.
A Boastful Race Player Gives Aid.
Fortune Changes Her Mood and Smiles Again.
The Kentucky Colonel Falls in Line.
Betting the Public’s Money at Great Profit.
$130,000 Is Lost and Won in a Day.
A Disastrous Newspaper Wind-up.
 
II MINING FINANCE AT GOLDFIELD 46
A Partnership of Pure Nerve.
Bucking the Tiger on the Desert.
Bidding $3,000,000 When Broke.
Millions in the Vista Held No Charms.
“Human Interest” Versus Technical Mining.
Beginning the Advertising Business.
Some Advertising that Paid.
Building Gold Mines with Publicity.
Hair-Raising Stories for Distant Readers.
The Mercury of Speculation.
The Birth of Bullfrog.
Enter, Charles M. Schwab.
Why the Bottom Fell Out.
How About the Public’s Chances?
Jumping Jack Manhattan.
 
III THE BREWING OF A SATURNALIA OF SPECULATION 89
Trying It on the Stray Dog.
Advertising for Thinkers.
Yes, “Business Is Business.”
Fortunes that Were Missed.
The Tale of Bullfrog Rush.
Prize Fights and Mining Promotion.
The Year of Big Figures.
The Story of Goldfield Consolidated.
At the Height of the Frenzy.
 
IV THE GREENWATER FIASCO 133
Getting Into the Game.
All the Copper in the World.
The Collapse of Greenwater.
The Shame and the Blame.
 
V ON THE EVE OF THE GREAT GOLDFIELD SMASH 144
The Rise of Wingfield and Nipon.
The Winnings of a Tenderfoot.
I Am Landed High and Dry.
The Beginning of the Raid.
Some Pertinent Personalities.
The Time When Money Talks.
Clouds in the Western Sky.
From Credit to Crash.
Down with the Sullivan Trust Company.
Some Hindsight that Came Too Late.
 
VI NIPISSING AND GOLDFIELD CON 179
An Orgy in Market Manipulation.
The Guggenheims Enter Nipissing.
Nipissing on the Toboggan.
Who Got the $75,000,000?
The Wonder Mining-Camp Stampede.
Teague Attacks Senator Nixon.
“Calling for a Show-Down.”
Manipulating Goldfield Con.
Enter, Nat. C. Goodwin & Co.
The Story of the Goldfield Labor “Riots.”
The Death of Governor Sparks.
 
VII RAWHIDE 219
Real Gold at Rawhide.
The Rawhide Coalition Mines Company.
A Race of Gamblers.
 
VIII THE PRESS AGENT AND THE PUBLIC’S MONEY 227
Publicity via Elinor Glyn.
“Al” Miller’s Siege.
The Funeral Oration for Riley Grannan.
Among the “Big Fellows.”
The Reverse English.
The Power of the Public Print.
Rawhide Again.
 
IX THE WALL STREET GAME 264
Good Big Fish vs. Bad Little Fish.
Righteous Wall Street and the “Sucker” Public.
The Marketing of Mining Stock.
I Buck the Wall Street Game.
The “Double-Crossing” of Rawhide Coalition.
“Inside” Market Support.
 
X ENTER, B. H. SCHEFTELS AND COMPANY 288
More Truth on the “Mining Financial News.”
The Scheftels Principles.
The Scheftels Company Against Margin Trading.
 
XI A FIGHT TO THE DEATH 308
The Firing of the First Guns.
The Story of Ely Central.
The Assault on Ely Central.
The Clash of Battle.
A Bombshell in the Enemy’s Camp.
A Government Raid Is Rumored.
The Raid on B. H. Scheftels and Co.
A Tool’s Confession.
The Guggenheims.
 
XII THE LESSON OF IT ALL 362

FOREWORD

You are a member of a race of gamblers. The instinct to speculate dominates you. You feel that you simply must take a chance. You can’t win, yet you are going to speculate and to continue to speculate—and to lose. Lotteries, faro, roulette, and horse-race betting being illegal, you play the stock game. In the stock game the cards (quotations or market fluctuations) are shuffled and riffled and STACKED behind your back, AFTER the dealer (the manipulator) knows on what side you have placed your bet, and you haven’t got a chance. When you and your brother gamblers are long of stocks in thinly margined accounts with brokers, the market is manipulated down, and when you are short of them, the prices are manipulated up.
You are on guard against the Get-Rich-Quick man, and you flatter yourself that you can detect his wiles at a glance. You can—one kind of Get-Rich-Quick operator. But not the dangerous kind. Modern Get-Rich-Quick Finance is insidious and unfrenzied. It is practised by the highest, and you are probably one of its easy victims.
One class of Get-Rich-Quick operator uses crude methods, has little standing in the community, operates with comparatively small capital, and caters to those who do not think and have only small resources. He is not particularly dangerous.
The other uses scientific methods—so scientific, indeed, that only men “on the inside” readily recognize them; occupies a pedestal in the community; is generally a man of excellent financial standing, a member of a stock exchange; employs large capital; appeals to thinkers or those who flatter themselves that they know the difference between a gold bar and a gold brick, and seeks to separate from their money all classes and conditions of men and women with accumulations large or small.
The United States Government during the past few years, at the behest of the big fellow, who seeks a monopoly of the game, has been raiding the little fellow—the crude operator whose power to injure is as nothing compared to the ravages that have been wrought by the activities of his really formidable prototype.
I have a message to communicate to every investor and speculator, a story to tell of my experience through the great Goldfield, Bullfrog, Manhattan and Greenwater mining booms in Nevada of 1905-1908, in which the public lost upwards of $200,000,000, and of a series of great mining-stock promotions in Wall Street and other American financial centers, in which the public sank $350,000,000 in 1910. The narration of the facts demonstrates that the Government’s Get-Rich-Quick crusade has made it less easy for some of the small offenders to thrive, but that the transcendentally greater culprits are at this very moment plucking the public to a fare-you-well, and that the Government has not lifted a finger against them.
No man, except a common thief, ever started out to promote a mining company or any other company that he was convinced at the outset had no merit; and the work of common thieves is quickly recognized and the offenders are easily apprehended.
The more dangerous malefactors are the men in high places who take a good property, overcapitalize it, appraise its value at many times what it is worth, use artful publicity and market methods to beguile the thinking public into believing the stock is worth par or more, and foist it on investors at a figure which robs them of great sums of money. There are more than a million victims of this practice in the United States.
After years of experience behind the scenes, the conclusion is forced upon me that the instinct to speculate is so strong in American men and women that they choose to “take a chance” regardless of the fact that at the outset they already half-realize they eventually must lose.
Myself, in boyhood, a victim of the instinct to speculate, I, years afterward, at the age of 30, learned to cater to the insatiable desire in others. I spent fortunes for advertising and wrote my own advertisements. I constructed on big lines powerful dollar-making machinery that succeeded in getting the money for my enterprises, and I was generally my own manager. Ten years of hard work in a field in which I labored day and night has disclosed to me that the instinct to gamble is all-conquering among women as well as men—the rich and the poor, the young and the old, the wise and the foolish, the successful and the unsuccessful.
Worse, if you have lost some of your hard-earned money in speculation, your case is undoubtedly incurable, because you have a fresh incentive, namely, to “get even.” Experience, therefore, will teach you nothing. The professional gambler’s aphorism, “You can’t kill a sucker,” had its genesis in a recognition of this fact, and now stock promoters and manipulators of the multi-millionaire class subscribe to its truth and on it predicate their operations.
Nearly everybody speculates (gambles); few win. Where does the money go that is lost? Who gets it?
Are you aware that in catering to your instinct to “invest,” methods to get you to part with your money are so artfully and deftly applied by the highest that they deceive you completely? Could you imagine it to be a fact that in nearly all cases when you find you are ready to embark on a given speculation, ways and means that are almost scientific in their insidiousness have been used upon you?
What are these impalpable yet cunningly devised tricks that are calculated to fool the wisest and which landed YOU? I narrate them herein.
What are your chances of winning in any speculation where you play another man’s game? HAVE YOU ANY CHANCE AT ALL?
In playing the horse races in years past you had only one chance if you persisted—YOU COULD LOSE.
In margin-trading on the New York Stock Exchange, New York Curb, Boston Stock Exchange, Boston Curb, Chicago Board of Trade, Chicago Stock Exchange, New York Cotton Exchange and kindred institutions, experience among stock-brokers proves that if you stick to the game you have only one chance—YOU CAN LOSE.
In railroad, industrial and mining-stock speculation, where you buy the shares outright and hold them for stock market profits, you have two chances; if you are of the average and your operations are for a period continuous—YOU CAN BREAK EVEN IF YOU ARE VERY LUCKY, OR LOSE IF YOU ARE NOT; and in justice to myself I must be allowed to explain that I had a much better opinion of the public’s chances ten years ago than I have now, and that experience on the inside has taught me this.
The moral to the investor and speculator is “Never Again!” And yet you WILL speculate again. Experience teaches that so long as the chance of speculative gain exists in any enterprise, so long will the American public continue in its efforts to appease its speculative appetite.
G. G. R.
MY ADVENTURES WITH YOUR MONEY

  CHAPTER I

The Rise and Fall of Maxim & Gay

The place was New York. The time, March, 1901. My age was thirty. My cash capital, tightly placed in my pocket, was $7.30, and I had no other external resources. I was a rover and out of a job.
Since August of the year before I had been loafing. My last position, seven months before, was that of a reporter for the New Orleans Times-Democrat. My last newspaper assignment was the great Galveston cyclonic hurricane in which 15,000 lives were lost and $100,000,000 in property was destroyed. I covered that catastrophe for the New York Herald and other journals as well as for the New Orleans newspaper. It was a “beat” and I netted a big sum for a few days’ hard work, but the money had all been spent for subsistence.
At the corner of Fortieth Street and Broadway I met an old-time racetrack friend, Dave Campbell. His face wore a hardy, healthful hue, but he bore unmistakable evidence of being down on his luck.
“Buy me a drink,” he said.
“I’ve got thirty cents in change and I must have a cigar,” I answered, “and you know I like good ones.”
“Well, I’ll take a beer,” he said, “and you can buy yourself a perfecto.”
No sooner said than done. The cigar and the drink were forthcoming. We sat down. It was a café with the regulation news-ticker near the lunch counter.
“Do you still bet on the horses?” asked Campbell.
“No, I haven’t had a bet down in more than a year,” I answered.
“Well, here’s a letter I just received from Frank Mead at New Orleans, and it ought to make you some money,” he said.
“There’s a ‘pig’ down here named Silver Coin,” the letter said, “that has been raced for work recently. I think he’s fit and ready and that within the next few days they will place him in a race that he can win, and he will bring home the coonskins at odds of 10 to 1.”
I had seen letters like that before, but my interest was aroused. I picked up a copy of the New York Morning Telegraph from the table. Turning the pages, I noticed a number of tipsters’ advertisements, all claiming they were continually giving the public winners on the races.

THE BIRTH OF AN IDEA TO COIN MONEY

“Do these people make money?” I asked Campbell.
“Yes, they must,” he answered, “because the ads have been running every day for months and months.”
“Well, if poorly written ads like these can make money, what would well-written ads accomplish, and particularly from an information bureau which might give real information?” I queried. A moment later the ticker began its click, click, click.
“Here come the entries,” said Campbell.
He went to the tape and ejaculated, “By Jiminy! Here’s Silver Coin entered for to-morrow.”
The coincidence stirred me.
“I’ve got an idea for an advertisement,” I said. “Get me a sheet of paper.”
It was supplied. I wrote:

Bet Your Last Dollar On
SILVER COIN
To-day
At New Orleans
He Will Win At 10 to 1

And then I faltered. “I must have a name for the signature,” I said.
I picked up the newspaper again and turned to the page containing the entries for that day at the New Orleans races. A sire’s name was given as St. Maxim.
“Maxim!” I said. “That’s a good name. I’ll use it. Now for one that will make euphony.”
“Gay!” said Campbell. “How’s that? It’s sporty.”
Thereupon I created the trade-mark of Maxim & Gay.
In a postscript to this advertisement I stated that the usual terms for this information were $5 per day and $25 per week, and that the day after next Maxim & Gay would have another selection, which would not be given away free.
“Maxim & Gay” were without an address. Half a block away on Broadway, at a real estate office, we were informed that upstairs they had some rooms to let. I engaged one of these for $15 a month—no pay for a week. Two tin signs were ordered painted, bearing the inscription, “Maxim & Gay.” One was placed at the entrance of the building and the other on the door upstairs. The sign-painter

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