It was rumored at the time that this money had either been obtained from the Government as a deposit for the Nixon National Bank in Reno or was obtained at great sacrifice from Wall Street bankers, and that only by virtue of Mr. Nixon's position as Chairman of the Committee on National Banks of the United States Senate was he able to get the Sub-Treasury in New York to instruct the Mint at San Francisco to supply the gold at this crucial period when fiat money was current in the East. Whether it was a Government deposit or not, Senator Nixon got it—and he needed it.
Even to this day Wingfield and Nixon are engaged in an effort to shift the responsibility to me for the destruction of the great mining camp of Goldfield, which to-day marks the graveyard of a million blighted hopes.
On the eve of the Wall Street panic of 1907, every bank in Goldfield and Tonopah that had existed through the mining boom with the exception of those of Wingfield and Nixon, went to the wall, and every Goldfield broker, with one or two exceptions, went broke. The business interests of the camp suffered the same experience. Wingfield and Nixon succeeded in annexing the remnants of the Goldfield banking business, along with the control of nearly all of the Goldfield properties for which they had been seemingly gunning. Wingfield and Nixon are, in fact, to-day in control of the political as well as the banking and precious-metal mining industry of the State. They have triumphed, but Goldfield, except for the big mine and one or two others of little consequence which they do not own, has been throttled and is dying the death. Had Wingfield and Nixon played a broad gauged game, the camp would undoubtedly still be on the map and, instead of having only two or three mines, might now boast of thirty.
As quickly as possible I convened a meeting of the creditors of the Sullivan Trust Company, all of whom happened to be either Western brokers or banks. The market had gone to smash and our liabilities were $1,200,000. The assets, calculated at the low market price of the securities that was reached after the embarrassment was publicly announced, were still in excess of the liabilities. The creditors agreed in jig time that if we would turn over all of the securities they would accept 80 per cent. of the net proceeds as full payment of our obligation and return the other 20 per cent. to the trust company.
Thomas B. Rickey, president of the State Bank & Trust Company, was appointed manager of the pool, and was also elected president of the Sullivan Trust Company, which exists in moribund state to this day. Mr. Rickey had even a higher opinion of the value of the securities than we had, and he refused to sell any of them at the prices which then prevailed. He held on. During the bankers' panic of 1907 the State Bank & Trust Company failed for about $3,000,000. The Sullivan mines were compelled to shut down. Mr. Rickey still held on. Manhattan, the mining camp, struck the toboggan. The boom in Goldfield securities collapsed at the same moment. The Sullivan stocks shriveled, like the rest of the list, to almost nothing.
As far as I can learn, neither the bank or broker-creditors nor any of the members of the Sullivan Trust Company have ever received a dollar as a result of the settlement. Had the securities been disposed of immediately after the embarrassment, the trust company would have paid dollar for dollar. Those of the public who did not sell their holdings in the Sullivan companies when we were supporting the market to the extent of more than $3,000,000, lost most of their investment. Those who did sell—most of them—made money. The market value of these securities, at the height of the boom, was in excess of $5,000,000. The price paid for them by the public, as already stated, was in the neighborhood of $2,000,000.
After settling with the creditors of the Sullivan Trust Company on the basis just outlined, I departed from Goldfield as broke as when I arrived there three years before. The only money I or my partners had drawn from the business during the life of the trust company was about $5,000, just sufficient to pay living expenses. My expenses to New York, where I went to have my head operated on—are you surprised?—were supplied by the proceeds of the sale of my seat on one of the Goldfield stock exchanges, from which I netted $400. I landed back in the big city with $200 in my pocket, the exact sum with which I had left town three years before.
My reward for three years of untiring work on the desert was a big fund of Experience. Believe me, I thought it would hold me for a while! But it didn't.
CHAPTER VI
Nipissing and Goldfield Con
The embarrassment of the L. M. Sullivan Trust Company, was disastrous to Goldfield, The decline and fall of the camp dated from that very hour.