The Goldfield News, of nation-wide circulation in those days and up to then unshackled, sought to stem the tide. It published a double-leaded editorial, in full-face type, setting forth that the Sullivan Trust Company had gone down with its flag nailed to the masthead of a declining market and had lost its last dollar supporting its own stocks.
The camp took courage. Soon it became evident that the initial smash in stock-market values was not sufficient to convince the natives that the death-knell of the market for its long line of mining securities had been sounded.
The population of Goldfield was 15,000. Its life could not be snuffed out in a day. Great was the depreciation in the market price of Goldfield mining issues, but not to an extent as yet that indicated the almost complete annihilation of values which followed. Final destruction for the general list, with some scattering exceptions, came only after a "starving-out" siege on the part of investors, who refused to commit themselves farther and gradually resorted to liquidation.
Listed Goldfield securities, nearly 200 in number, and valued in the markets at above $150,000,000 during the boom, had within two months shown a falling off of $60,000,000 in market value, but the list on the average was still quoted higher than the promotion prices.
On January 18, 1907, fifteen days after the newspapers throughout the land carried front-page stories of the failure of the Sullivan Trust Company, the stocks promoted by the trust company were still in demand in all mining-share markets of the country at an average price not below that at which original subscriptions were accepted from the public.
Jumping Jack, promoted at 25 cents, was quoted at 30 cents bid. Stray Dog Manhattan, promoted at 45 cents, was in demand at 49 cents. Lou Dillon, promoted at 25 cents, was still wanted at 26. Indian Camp, sold originally to the public at 25, was quoted at 85 bid. Silver Pick Extension, promoted at 25, was 21 bid, a loss of 4 cents from the promotion price. Eagle's Nest Fairview was quoted at 25, off 10 cents from the promotion figure. These prices represented terrific losses from the "highs" that had been reached during the height of the Goldfield boom, yet the average market price was still above the subscription price of the shares at which the public was first allowed to participate. A remarkable part of this demonstration was that for twenty days no inside support had been lent to these stocks. The Sullivan Trust Company being in trouble, the markets had been left to the mercy of short-sellers and market sharp-shooters generally.
Having settled the trust company's liabilities of $1,200,000 by tying up in trust all of its securities and the other assets, of which the creditors agreed to accept in full quittance 80 per cent. of the proceeds and to turn back to the trust company 20 per cent., I returned to New York during the last week in January. I was again out of a job—and broke.
I visited the officers of mining-stock brokers in Wall Street and Broad Street. Wherever I went a hearty handclasp was extended. Not one of the Eastern stock brokers was involved to the extent of a single dollar in the Sullivan Trust Company failure.
The brokers were convinced that the embarrassment was honest. The trust company's credit had always been good. Had the failure been meditated, I could have involved Eastern brokers for at least $1,000,000. Because I didn't, New York brokers were not slow to express their good feeling. A number of them offered to extend a helping hand did I wish to embark on a new enterprise.
Peculiarly enough—or shall I say, naturally—after tossing off the trust company's millions, of which half were mine, in a vain endeavor to support the market for its stocks, I was as full of spirit as the month of May. I had been broke before, and the sensation was not new to me. Withal, I had profited. A new fund of experience was mine. Even though I had not gathered shekels as a result of my hard work in Goldfield, I had learned something—I had acquired the rudiments of a great business.