Let us say that the stock was worth fifty cents per share. One broker bid fifty-five cents for a thousand shares, and they all pretended that it was a legitimate transaction—in reality it was a fake bid and a fake transaction.
The other broker engaged in the skin game would then bid sixty cents for another thousand shares—and so it would go.
Not one person engaged in the swindle was actually buying a single share of stock. They simply bid back and forth, pretending to buy it, and putting the price up day by day.
The crowd of poor fools that believe in the “honor” of these disreputable Wall Street gamblers looked on at this mock auction, this fake selling and buying of stocks, amazed and excited by the constantly increasing values.
Occasionally some gullible creature outside the combination that was doing the stock “washing” would come in and in good faith buy some shares, actually paying his good money for the worthless stuff.
This went on until they had forced the price of the stock up to a high figure, ten times what it was worth. During this “washing” operation, they had succeeded in working off a good deal of this stock on the public that believed the crooked sales were really genuine.—New York Journal.
The Chicago Union Traction Street Railway Company has issued bonds and stocks to the amount of $112,500,000, or at the rate of $135,507 a mile. The capitalization of all the street railways in Massachusetts only amounts to $110,000,000. In Massachusetts, stock watering is prohibited, and the average capitalization of trolley lines in that state is only $390.67 per mile. The sort of work done in Chicago is theft, and the men who did it, although they occupy the chief seats in the churches, are thieves. There is not a preacher in the whole city that dare say so, and that makes them accomplices of the thieves.—Nebraska Independent.
The Chicago Record-Herald, a Republican paper, refers to the fact that the Federal Grand Jury returned indictments against Senators Mitchell, Burton and Dietrich, and says: “In each of these deplorable instances the charges involve corruption and moral turpitude—a bitter reflection for a legislative body proud of its traditions and jealous of its prerogatives and reputation. The low tone of political morality receives a painful and striking illustration in these successive blows to senatorial prestige.”