Tell Them I'll Be There (28 page)

‘Listen,' Dan said. ‘I'd like to stay, go for a drink or
something
. But I have to get back. I need to see Harry before he goes home.'

Merrick stood up. ‘It's good to see you, Dan, and it was good of you to come and find me, I appreciate it. But if you've come to offer me my job back, it must be thank you but no thanks.'

‘Actually,' Dan said, ‘I came to give you this.' He handed over a cheque for a thousand dollars.

‘What's this?'

‘It's to help you find a place out West and to make an honest man of you. Before you go you can pay your landlady what you owe her.' He handed Merrick a second cheque now, this one for
fifty
thousand.

Merrick held the cheque gingerly, his hand beginning to shake. He looked at Dan in amazement.

‘It's what you should have had in the first place.'

‘I can't take this,' Merrick said.

‘We're in the investment business,' Dan told him. ‘See it as an investment and don't forget to send me tickets when your first talkie hits New York.'

Merrick was sitting down on the edge of the bed again, his hand shading his eyes.

T
HE NEXT MORNING
it was hot and humid. To Dan, the people at the Exchange seemed restless and there was a tension in the air as if the heat was building up to an unsustainable level and was about to burst with a shattering thunderclap.

He carried on where he left things the day before, clearing out the company's holdings and cashing in relentlessly. It was
noticeable
now but nobody interfered. He was a young guy who didn't know what the hell he was doing and the older, more
experienced
simply shook their heads and carried on trading. Michael Meehan might have had something to say had he noticed what was happening to his old friend Joe Baker's portfolio, but he was too absorbed in the steady revival of his Radio stock and most of the day Post 12 was surrounded by eager speculators.

Everything was still on the up and even later that month when there was what most investors saw as a temporary hitch and prices fell slightly and looked unsteady the general air of optimism was not shaken. Stocks had dropped before but always they had recovered. Falls had been followed by a sharp rise and prices had climbed even higher. ‘Smart' operators saw such minor setbacks as opportunities to snap up bargains.

Dan Dolan was seen now by most of the Exchange's members as a young man who had struck lucky, taken over Joe Baker's business and was intent on stripping the assets, cashing in and getting out. At the office even Harry questioned the logic of what he was doing. ‘Prices are still going strong,' he said. ‘Are we right to be pulling out just now?' 

‘It was Mr Baker's advice,' Dan told him.

Then Harry asked the question that was really troubling him, ‘You're not planning to wind up the business?'

Dan assured him he was not. He was simply following the instructions of the man who always knew what to do.

At the Exchange just one man, a Mr Weber, approached him with approval and encouragement. He was a quiet man who didn't seem to have many friends or associates and he was seen by most of his fellow members of the Exchange as a boring pessimist, an unwelcome prophet of doom.

‘You are doing the right thing, son,' he said. ‘I've been telling them for months now. Things have gone too far. Everything is overvalued and it can't last. I tell them but they don't listen. No one
wants
to listen. They are all mad with greed.' He lowered his voice. ‘And we will all have to pay one day.'

But prices regained their balance and started to soar again and Weber's gloomy predictions didn't come true until several weeks later. Then, on Thursday, October 24, the unthinkable happened. The world of high finance woke up to heart-stopping news. Dan heard the first rumble on the radio as he shaved at 7.30.

In the last hour before the closing gong the previous day there had been a frenzy of selling and some stocks dropped as much as fifteen dollars as no one stepped in to buy. A radio announcer, intent on sniffing out a big story, exaggerated what had happened citing an alleged report of a man jumping from a skyscraper and traders being rushed to hospital with suspected heart attacks. None of this was true but it was obvious that something momentous was happening on Wall Street and this time it was not good news.

As Dan went down to the Exchange the streets seemed strangely quiet. It was as if a bomb had dropped in another part of town and people were waiting for news of survivors. A crowd had gathered by the spot where the country's first president, George Washington, had been sworn in. On Wall Street, at the entrance to Broad Street and in front of the imposing façade of the J.P. Morgan building the crowd was swelling to record 
proportions. Dan had literally never seen anything like it. Yet the crowd was strangely quiet. Men and women stood around with anxious eyes as if waiting for a lead, an announcement to say it was all a ghastly mistake or a signal to start a race to offload their holdings and grab what crumbs they could.

Dan had to ease his way gently through the throng to reach the main entrance on Broad Street where the sergeant on duty opened the door only slightly, noted his card and let him in, hurriedly closing the door behind him.

Police officers were prominent on every street corner as the crowds were contained by officers on horseback and movietone news cameras were set up at various vantage points. But this was no festive occasion. It was more like a wake and there was a general feeling of foreboding that things were bad and were about to get much worse.

Inside the Exchange prices were falling dramatically and the trading floor was filled with frantic traders crowding round the posts and waving pieces of paper, anxious to sell at whatever price they could and at least salvage something from their
shattered
dreams. A short fat man whose normally red face was now almost puce glared at Dan with a pained expression as if to imply Dan had known something and had failed to pass this information on to his fellow members.

At Post 12 Michael Meehan, inundated with people wanting to sell, was unable to trade. There were no buyers. It was the same at Post 2 where sellers were frantically trying to offload US Steel and it was the same with General Motors at Post 4. The anxiously watched ticker-tape machines simply could not keep up and by noon the prices were hopelessly behind. Anyone checking with the telephone quotation service to find if things were really this bad found they were infinitely worse.

Dan was beginning to wonder why he was there. He had sold all the company's major shareholdings at a handsome profit. The stocks the company still held were minor investments and, though they had suffered with the majority during the day, they did not add up to any great loss. He decided to get out, away from all the anxiety on the floor of the Exchange. But then word 
went round that something was happening. Thomas W. Lamont, senior partner at J.P. Morgan and a highly regarded financial adviser had called a meeting of the city's leading bankers.

The meeting lasted less than an hour and a decision was reached that the banks represented would inject up to $100 million into leading stocks in an effort to halt the slide. Immediately, with the bankers' backing, the Exchange's most senior officer on duty that day, Richard Whitney, went straight to Post 2 and ostentatiously placed an order for 25,000 shares in US Steel at $205 a share. The crowd around Post 2 cheered loudly. Whitney then went from Post to Post placing orders for millions of dollars and the whole mood inside the Exchange changed. Leading shares began to bounce back and investor confidence was gradually restored. People were buying again and things were looking up. But by seven o'clock that evening when the ticker tapes at last caught up it was clear that the losses incurred were calamitous. Prices had fallen by almost $3 billion.

Dan didn't go back to the office until the next morning where Harry met him with a grin. ‘You had a visitor yesterday. Lovely lady.'

‘Oh, yeah?'

‘She waited for a while but I told her things were happening on Wall Street and I didn't know if you would be back. She said her name was Sue and she wrote you a note.'

He handed Dan a small envelope. Dan went into his office and sat at Pops' desk. ‘
Dan
,' he read. ‘
I'm leaving tomorrow with the rest of the girls. We're doing a tour of the Mid-West then I'm going out to LA and I won't be coming back. It was great fun, as they say, but maybe that's all that it was. Yours always, Sue. ps: We leave Penn Station at eleven
.'

Harry hadn't met Sue before but Lois had. The one other time Sue called Lois was there on her own and they had got along fine. Lois knocked lightly at the door now and breezed in. ‘There you are,' she said brightly. ‘I saw your girlfriend yesterday.'

‘She's not my girlfriend,' Dan said. 

Lois looked at him knowingly.

‘She's not,' he protested. ‘She says it was fun but that's all that it was.' He held up the note for her to read.

Lois peered at the note, reading it carefully. ‘She doesn't mean that,' she told him. ‘She wants you to get over to Penn Station and beg her to stay.'

‘I don't think so,' he said with a laugh.

‘Sure she does,' she insisted. ‘Why do you think she's telling you what time the train leaves?' She looked up at the clock on the wall. It was only nine o'clock. ‘You got plenty of time.'

Dan smiled and shook his head. ‘I have things to do.'

In the last couple of years Joe Baker had begun to buy land and property. Dan and Harry spent some time now going through and listing these acquisitions to get a clear picture. Then at 10.15 Lois brought coffee in. She looked at Dan
plaintively
as if willing him not to throw away his opportunity. ‘There's still time.'

Dan nodded, knowing what she meant. But he didn't go to Penn Station. He went down to the Exchange to see what the new day had brought.

Business leaders were playing down the disturbing drop in prices and reassuring themselves that the worst was over. Stocks would recover as they always had, they declared, and a move to close the Exchange for a period of quiet readjustment was defeated. Most members felt that such a move might create more panic.

In Washington the President, Herbert Hoover, was being urged to comment on the state of the markets, to say something positive. Hoover himself was not convinced that the worst was over, yet he was anxious not to say anything that might make matters worse. Mr Hoover did not trust the many speculators whose only motive was a quick profit. The President believed that cynical manipulation of the markets had raised the novice investor's expectations to unrealistic heights and he was
seriously
concerned for the millions of little people who had been spurred into risking their life savings by exaggerated reports of 
people like themselves who had ‘gotten rich overnight'. But in many cases it was not only their savings they were risking. Many were gambling with borrowed money, money they could not afford to lose.

In the boom years more and more people, most of them new to the market, borrowed money to buy stock. Everyone was in debt, or so it seemed, but as long as prices continued to climb the debt diminished. Brokers borrowed more and more from the banks to lend to customers and even when the rates of interest went up the borrowers were not deterred.

The nation's bank, the Federal Reserve, wanted to keep this mass speculation at acceptable levels but some city bankers refused to listen and increased their levels of lending to the brokers. The mad climb continued and was fuelled still further when some of the large corporations, eyeing the high level of interest rates, decided lending to the market might prove more profitable than the business they were actually in. Soon they, too, were lending large sums to brokers. But as the demand for stock spiralled out of control no one seemed to notice that fewer houses were being built, the sale of automobiles had tailed off and steel production had slowed to a walking pace.

Compared to the previous day that Friday was quiet on Wall Street. It was, as one optimistic commentator reported, as if the City had picked itself up and dusted itself off. Yet for the
thousands
of investors new to the market it came as a shock, a salutary warning. Stocks could go down, just as dramatically down, as well as up. Inevitably, as margins diminished, there were many calls for cash and brokers were forced to sell the holdings of people who were unable to cover their debts.

Few investors were immune and there were many high profile losers. The cosmetics maker Helena Rubinstein lost well over a million dollars in just two hours. Comedian and singer Eddie Cantor lost his entire savings and allegedly was left with only sixty dollars in his pocket. He fuelled the myth about suicides jumping from skyscrapers by joking on stage that as he booked a room in a New York hotel the desk clerk asked, ‘Sleeping or jumping?' Another star comedian, Groucho Marx, also lost his 
life savings. Groucho went deep into debt trying to meet his broker's calls for cash. But, unlike Cantor, he could see no funny side to the situation and he fell into a severe depression that lasted for months and prevented him from working. Yet there were even bigger showbiz losers. Songwriter Irving Berlin lost an estimated $5 million.

Throughout the next day, the last Saturday in October, the enforced selling of the holdings of people who could no longer cover their losses went on. More and more small investors lost everything. The many hopefuls who had rushed out to reap the benefits of the boom years were learning a bitter lesson. A few of the more cautious players, a very small minority, had seen this coming but many big investors had not, or perhaps had not wanted to, and some had suffered multi-million dollar losses that left a question mark over the future of several of Wall Street's best known institutions.

Members of staff at the brokers' offices in and around the Financial District worked through the night now to unravel the tangle of falling prices and to attempt to decipher the hundreds of hurriedly scrawled entries they had made in their books. Many were literally exhausted and had to be sent home. Now, as the true picture emerged, it became clear that the chaos of these last few days had left many casualties.