Rumors of Gould’s death and of his impending bankruptcy were not infrequently circulated in Wall street. Rumors of death could be easily disproved, but once, at least, the street was firmly convinced that Gould was in financial difficulties, and Gould was obliged to exhibit his wealth in order to prove that he was solvent. On March 13, 1882, Gould exhibited to Sage, Field and Frank Work his box of securities, to show that he was not only solid, but also had not been a seller of stocks. He exhibited to the astonished vision of these associates $23,000,000 of Western Union, $12,000,000 of Missouri Pacific, and $19,000,000 of other stocks. Russell Sage said: “There is not another man in America except Vanderbilt who could make such a display of stock as that.” In 1884 Gould made another exhibition of his securities to John T. Terry and others, and the display was even bigger than two years before.
The panic of 1884 is believed to have caused Mr. Gould much anxiety. It came suddenly and without warning. There had been earlier in the year, it is true, the collapse and resignation of Henry Villard, soon followed by the failure of James R. Keene, but these disasters would not have produced the financial earthquake that shook Wall street in May. The failure of the Marine Bank and Grant & Ward, with the revelations which followed of embezzlement on a scale never before witnessed in the street, and the suspension on the memorable 13th and 14th of the month of the Metropolitan Bank, George I. Seney and seven or eight prominent banking-houses in this city and two banks in Brooklyn and Newark, caused a panic like that of 1869 and 1873, and from the depressing effects of which the street did not rally for several years. Gould’s fortune melted like snow in the decline of values which accompanied this panic. He came out of it probably $20,000,000 poorer than when it began. But this loss, it is true, was chiefly on paper. He was able to hold most of his securities, the value of which afterward increased. But it is believed that he was at one time very hotly pressed. His associate, Russell Sage, lost millions in the decline by his operations in puts and calls. His office was besieged by a mob clamorous for their profits. The old man reluctantly paid up, and, badly scared and sick at heart, retired from the street for a while, hoarding the $40,000,000 or $45,000,000 which was still left to solace him.
The men who chiefly profited by the great decline were Charles F. Woerishoffer and Addison Cammack, the leaders of a small but powerful bear party, which for several years had been preparing for this depression, and by all the bear tactics, of which they were masters, assisting in the downward movement. They were two men of mark. Woerishoffer was the superior in mind and nerve. When he died in 1886, while under forty years of age, he was worth, it is said, $8,000,000 to $10,000,000, the result of his daring speculation. He was probably the ablest stock speculator Wall street has ever seen, not excepting Gould, whose principal success, it should be remembered, was in operations outside of the street. Woerishoffer was by birth a German, and was the son-in-law of Oswald Ottendorfer. Some of the most successful men in Wall street, it may be remarked, are Germans or of German descent, as for instance Villard, who after his collapse in 1884 had recovered in 1888 the ground he had lost; August Belmont, the banker, the Wormsers and the Seligmans. Cammack was a man of much coarser nature than Woerishoffer. He came originally from the South, and the Wall street tradition was that he had been a slave-driver by profession. Gruff in his manner, uncouth in his language, he yet had qualities as a speculator which made him a power in the street. These two men, with their following, are believed to have very nearly driven Gould to the wall in 1884, and the story is that Gould might have gone down if Cammack, of all men, had not relented. This story, like many others told in Wall street, probably has a mixture of truth and fiction. In 1887 and 1888 Cammack was very evidently in alliance with Gould in stock operations.
Gould was not a member of the Stock Exchange, though he was often the biggest customer the institution had. He was, however, almost always in general or special partnership with some member of the Exchange and thus obtained all the advantages of personal membership. After the dissolution of the house of Smith, Gould & Martin, Gould became the silent partner in the firm of William Belden & Co. This was succeeded by the famous house of W. E. Connor & Co., which lasted about ten years and which engineered some of Mr. Gould’s most successful deals. At the time Mr. Gould retired from the firm, in 1886, it was composed of himself as special partner and of Washington E. Connor, G. P. Morosini and George J. Gould, the great operator’s eldest son. Mr. Connor was the ideal broker and perhaps the most valuable lieutenant Mr. Gould ever had. Not overscrupulous in carrying out the interests of his master, he was faithful to the last minute to him. Tempting offers were made to buy him off at various times, and he might have made several fortunes in betraying the confidences of his chief, but it is believed he was always true. Like Morosini, he allied his interest to those of Gould and profited by the connection. When the firm dissolved, Gould said of his partners: “Both are very rich men. Mr. Connor is worth at least a million and Mr. Morosini two or three times as much. The new firm will have my heartiest good will in whatever it undertakes. Between Mr. Connor, Mr. Morosini and myself there has never been an interruption of good feeling.”
Mr. Connor was not only faithful, but quick and shrewd in his judgments. Upon him rested nearly all the details of the best operations of the house. These operations often required the assistance of fifty or sixty brokers. Often these brokers did not know that they were working for the same client. Sometimes they were ignorant even of the fact that Gould was their client. The prime necessity in great stock operations is to conceal one’s movements. Sometimes a part of the brokers might be selling and a part might be buying. Gould and Connor alone held the strings of the intricate operations. One of the first great successful movements the house undertook was in Kansas Pacific in 1879. The stock within a period of a few months shot up from 8 to 97, and the bonds from 10 to 110. Gould cleared nearly $10,000,000 by this operation. The most brilliant feat accomplished by the house was performed when Gould acquired Western Union. Mr. Gould for a long time, as has been related, had been an uncompromising bear on the stock. The whole street was aware that he and his firm were heavily short of the stock. Suddenly the stock began to rush up. Gould was caught for once, it was said. The truth was that Connor had engineered the movement and Gould had not only bought in all his shorts but purchased enough stock to give him control of the company. It was also this house that pushed Western Union up from 78 to 91 and pushed Henry Smith and other bears to cover their shorts at a heavy loss. It also handled the elevated railway deals.
While Gould and the Beldens were in partnership at No. 80 Broadway, Connor had a small office in the rear. He was bright, sharp, sagacious, reticent and nearly as well informed as Gould himself. Gould was drawn to Connor naturally, and when the former fell out with the Beldens he and Connor formed a co-partnership. Mr. Morosini for many years had been Mr. Gould’s man Friday, and was invariably seen with a large canvas bag following his employer to the safe deposit vaults and protecting him against any repetition of the Selover attack. Morosini went into the new firm, whose limitation only ran from year to year. Connor and Morosini put in $100,000 each, and Gould, as special partner, $250,000. George Gould was admitted in 1881, but without paying in a cent. Although the nominal capital of the house at all times has been $450,000, the actual capital, at times of great activity on ’Change, ran up into the millions.
But Mr. Connor was not Gould’s only broker. Charles J. Osborn was for years one of Gould’s closest lieutenants and associates, and a more dashing broker never stepped into the Stock Exchange. William Heath, “the antelope of Wall street,” as he was called because of his long legs and slender body, was also long a favorite with Gould. Heath was a master at keeping secrets. None of his customers could ever learn what his other customers were doing. His faithfulness, experience and ability, however, availed him little in the end. He assisted Gould in Black Friday and helped him in many a risky transaction. When Heath failed with Henry N. Smith in 1885, Mr. Gould, though, with Morosini, the principal creditor, did not come to his assistance. It was thought that Gould would put him on his feet again, but he did not do so, and Heath—alone, broken in spirit and in fortune—died shortly after in Staten Island, but not until he had been lodged for a while in Ludlow street jail, a prisoner for debt.
On the dissolution of W. E. Conner & Co., Dec. 31, 1885, Mr. Gould announced his permanent retirement from the street. That perhaps was his intention (though he was as prolific in retirements as Charlotte Cushman), but it was not long before his presence was again felt in the Stock Exchange.
Gould had other personal encounters besides the one with Major Selover. Once, while lunching in Delmonico’s, a lawyer named Marrin addressed him and asked him to accompany him to a private room. Mr. Gould declined. Marrin struck him in the face, saying: “If you have no time to see me, take that!” Mr. Gould quietly continued his lunch. Mr. Marrin was summoned before a magistrate and compelled to give $500 bonds.
It was his habit to have duplicated reports from corporation officers before the originals were presented. He was now and then cheated, but not often. On one occasion a leading editorial severely animadverting on him and Fisk was shown to him before any considerable part of the paper’s edition had gone to press. He handed the party who brought him the paper $10,000 in greenbacks and the edition appeared without the disturbing criticism. His enemies were numerous, not that he hated any one himself, but his operations necessarily involved men of small means and often ruined them outright.