Still the public had begun to buy. But not before Wolff, Herzog & Co. had purchased for $117,000,000 bonds which a month before could not have been purchased for less than $148,000,000, all for account of Mr. George K. Grinnell; and had sold short 250,000 shares of stocks at an average price of $190 per share, stocks which four weeks previously could not have been sold at $125 per share, these for account of “Account G,” which included equally Mr. George K. Grinnell, Wolff, Herzog & Co., of New York; I. Benjamin & Co., of London; Stetheim & Sons, of Frankfort and Amsterdam, and Goldschmidt Freres, of Paris. And because of these operations the bond-market steadied and the stock-market ceased to advance, and people plucked up courage and bought bonds and sold stocks, until bonds began actually to rise slowly and stocks to decline steadily and greater courage gained thereby. And because the public, which is everybody, is greater than anybody, greater even than the richest man in the world, the Paradoxical Panic was checked.
There came a lull. After all, the public had but ceased to fear to buy bonds. It must be made to fear not to buy them; for bonds still were much too low and stocks very much too high. Wherefore, the Evening Scold, which had been importuning Mr. Isaac L. Herzog for an expression of his views, was at last able to publish an interview, double leaded, in its front page, in which the great financier strongly urged investors not to sell bonds but rather to buy. As for stocks, it was not wise to buy them but rather to sell. Investors need not be anxious over fundamental business conditions. Speculators, on the other hand, had before them a highly dangerous stock-market.
It was the first and only interview any newspaper had ever been able to obtain for publication from Mr. Herzog; and the Evening Scold was so uniformly ill-natured and impartially condemnatory that it was above suspicion. It was ultra-Mugwump in politics, art, literature, finance, and base-ball. The morning papers “verified” the interview and reprinted it prominently on the next day. And into Wall Street poured hordes of men, of all ages and political complexions—Jew and Gentile—of all degrees of fortune, and of no fortune at all, but all of them men who believed in Mr. Herzog’s integrity, and particularly in his sagacity. There followed a Great Day. Mostly, the public bought bonds. The selling pressure really was over by now, the enlightened millionaires being practically bondless; so bonds rose quickly, unchecked. And stocks declined, not so quickly, but every whit as steadily.
Mellen read the Herzog interview in Dawson’s office. When he was done with them, he carefully folded the newspapers and piled them neatly on the table. It was an unfailing habit of his—that and saving the twine that came with parcels.
He arose, with a troubled expression on his face, and said to the president:
“Herzog is a very able man. I don’t like this interview. He speaks too confidently.” Into Mellen’s eyes came the puzzled, indecisive look which Dawson had seen there so frequently in the last few weeks, and so seldom in the previous twenty years.
“He has a considerable following,” admitted the president in a cheerful voice, as though to keep his friend from dwelling too much on sorrow. “They have been heavy buyers of bonds and heavy sellers of stocks. That’s for Europe. They’ve sold us nearly all the sterling bills that we needed for Grinnell’s drafts. Grinnell has practically drawn all his money and sent it to London.”
“I don’t like it, Richard; I don’t like it a bit. Perhaps we’ve been too hasty; and yet—” He stared at Dawson unseeingly. “Where did he get it?” His lips were dry; he moistened them with the tip of his tongue and pressed them together.
“William, every bullion dealer in the world has been interviewed. Costello had twenty men in the West visiting the mines and smelters. We have had reports from the Klondike, from the Transvaal, from Australia, from mining engineers everywhere. We have even gone over the manifests of vessels that have brought bullion here and to other ports this year. Costello was twice in the laboratory. Since he promised to stop depositing, Grinnell has been idle. The dynamo has not been running.”
“But there must be a mine.”