Part 35

I left the money undisturbed and resumed my trading. I was getting on very nicely. I was recovering my poise and I was sure it would not be very long before I should get back into my 1907 stride. Once I did that, all I’d ask for would be for the market to hold out a little while and I’d more than make up my losses. But making or not making the money was not bothering me much. What made me happy was that I was losing the habit of being wrong, of not being myself. It had played havoc with me for months but I had learned my lesson.

Just about that time I turned bear and I began to sell short several railroad stocks. Among them was Chesapeake & Atlantic. I think I put out a short line in it; about eight thousand shares.

One morning when I got downtown Dan Williamson called me into his private office before the market opened and said to me: “Larry, don’t do anything in Chesapeake & Atlantic just now. That was a bad play of yours, selling eight thousand short. I covered it for you this morning in London and went long.”

I was sure Chesapeake & Atlantic was going down. The tape told it to me quite plainly; and besides I was bearish on the whole market, not violently or insanely bearish, but enough to feel comfortable with a moderate short line out. I said to Williamson, “What did you do that for? I am bearish on the whole market and they are all going lower.”

But he just shook his head and said, “I did it because I happen to know something about Chesapeake & Atlantic that you couldn’t know. My advice to you is not to sell that stock short until I tell you it is safe to do so.”

What could I do? That wasn’t an asinine tip. It was advice that came from the brother-in-law of the chairman of the board of directors. Dan was not only Alvin Marquand’s closest friend but he had been kind and generous to me. He had shown his faith in me and confidence in my word. I couldn’t do less than to thank him. And so my feelings again won over my judgment and I gave in. To subordinate my judgment to his desires was the undoing of me. Gratitude is something a decent man can’t help feeling, but it is for a fellow to keep it from completely tying him up. The first thing I knew I not only had lost all my profit but I owed the firm one hundred and fifty thousand dollars besides. I felt pretty badly about it, but Dan told me not to worry.

“I’ll get you out of this hole,” he promised. “I know I will. But I can only do it if you let me. You will have to stop doing business on your own hook. I can’t be working for you and then have you completely undo all my work in your behalf. Just lay off the market and give me a chance to make some money for you. Won’t you, Larry?”

Again I ask you: What could I do? I thought of his kindliness and I could not do anything that might be construed as lacking in appreciation. I had grown to like him. He was very pleasant and friendly. I remember that all I got from him was encouragement. He kept on assuring me that everything would come out O.K. One day, perhaps six months later, he came to me with a pleased smile and gave me some credit slips.

“I told you I would pull you out of that hole,” he said, “and I have.” And then I discovered that not only had he wiped out the debt entirely but I had a small credit balance besides.

I think I could have run that up without much trouble, for the market was right, but he said to me, “I have bought you ten thousand shares of Southern Atlantic.” That was another road controlled by his brother-in-law, Alvin Marquand, who also ruled the market destinies of the stock.

When a man does for you what Dan Williamson did for me you can’t say anything but “Thank you”--no matter what your market views may be. You may be sure you’re right, but as Pat Hearne used to say: “You can’t tell till you bet!” and Dan Williamson had bet for me--with his money.

Well, Southern Atlantic went down and stayed down and I lost, I forget how much, on my ten thousand shares before Dan sold me out. I owed him more than ever. But you never saw a nicer or less importunate creditor in your life. Never a whimper from him. Instead, encouraging words and admonitions not to worry about it. In the end the loss was made up for me in the same generous but mysterious way.

He gave no details whatever. They were all numbered accounts. Dan Williamson would just say to me, “We made up your Southern Atlantic loss with profits on this other deal,” and he’d tell me how he had sold seventy-five hundred shares of some other stock and made a nice thing out of it. I can truthfully say that I never knew a blessed thing about those trades of mine until I was told that the indebtedness was wiped out.

After that happened several times I began to think, and I got to look at my case from a different angle. Finally I tumbled. It was plain that I had been used by Dan Williamson. It made me angry to think it, but still angrier that I had not tumbled to it quicker. As soon as I had gone over the whole thing in my mind I went to Dan Williamson, told him I was through with the firm, and I quit the office of Williamson & Brown. I had no words with him or any of his partners. What good would that have done me? But I will admit that I was sore--at myself quite as much as at Williamson & Brown.

The loss of the money didn’t bother me. Whenever I have lost money in the stock market I have always considered that I have learned something; that if I have lost money I have gained experience, so that the money really went for a tuition fee. A man has to have experience and he has to pay for it. But there was something that hurt a whole lot in that experience of mine in Dan Williamson’s office, and that was the loss of a great opportunity. The money a man loses is nothing; he can make it up. But opportunities such as I had then do not come every day.

The market, you see, had been a fine trading market. I was right; I mean, I was reading it accurately. The opportunity to make millions was there. But I allowed my gratitude to interfere with my play. I tied my own hands. I had to do what Dan Williamson in his kindness wished done. Altogether it was more unsatisfactory than doing business with a relative. Bad business!

And that wasn’t the worst thing about it. It was that after that there was practically no opportunity for me to make big money. The market flattened out. Things drifted from bad to worse. I not only lost all I had but got into debt again--more heavily than ever. Those were long lean years, 1911, 1912, 1913 and 1914. There was no money to be made. The opportunity simply wasn’t there and so I was worse off than ever.

It isn’t uncomfortable to lose when the loss is not accompanied by a poignant vision of what might have been. That was precisely what I could not keep my mind from dwelling on, and of course it unsettled me further. I learned that the weaknesses to which a speculator is prone are almost numberless. It was proper for me as a man to act the way I did in Dan Williamson’s office, but it was improper and unwise for me as a speculator to allow myself to be influenced by any consideration to act against my own judgment. Noblesse oblige--but not in the stock market, because the tape is not chivalrous and moreover does not reward loyalty. I realise that I couldn’t have acted differently. I couldn’t make myself over just because I wished to trade in the stock market. But business is business always, and my business as a speculator is to back my own judgment always.

It was a very curious experience. I’ll tell you what I think happened. Dan Williamson was perfectly sincere in what he told me when he first saw me. Every time his firm did a few thousand shares in any one stock the Street jumped at the conclusion that Alvin Marquand was buying or selling. He was the big trader of the office, to be sure, and he gave this firm all his business; and he was one of the best and biggest traders they have ever had in Wall Street. Well, I was to be used as a smoke screen, particularly for Marquand’s selling.

Alvin Marquand fell sick shortly after I went in. His ailment was early diagnosed as incurable, and Dan Williamson of course knew it long before Marquand himself did. That is why Dan covered my Chesapeake & Atlantic stock. He had begun to liquidate some of his brother-in-law’s speculative holdings of that and other stocks.

Of course when Marquand died the estate had to liquidate his speculative and semispeculative lines, and by that time we had run into a bear market. By tying me up the way he did, Dan was helping the estate a whole lot. I do not speak boastfully when I say that I was a very heavy trader and that I was dead right in my views on the stock market. I know that Williamson remembered my successful operations in the bear market of 1907 and he couldn’t afford to run the risk of having me at large. Why, if I had kept on the way I was going I’d have made so much money that by the time he was trying to liquidate part of Alvin Marquand’s estate I would have been trading in hundreds of thousands of shares. As an active bear I would have done damage running into the millions of dollars to the Marquand heirs, for Alvin left only a little over a couple of hundred millions.

It was much cheaper for them to let me get into debt and then to pay off the debt than to have me in some other office operating actively on the bear side. That is precisely what I would have been doing but for my feeling that I must not be outdone in decency by Dan Williamson.

I have always considered this the most interesting and most unfortunate of all my experiences as a stock operator. As a lesson it cost me a disproportionately high price. It put off the time of my recovery several years. I was young enough to wait with patience for the strayed millions to come back. But five years is a long time for a man to be poor. Young or old, it is not to be relished. I could do without the yachts a great deal easier than I could without a market to come back on. The greatest opportunity of a lifetime was holding before my very nose the purse I had lost. I could not put out my hand and reach for it. A very shrewd boy, that Dan Williamson; as slick as they make them; farsighted, ingenious, daring. He is a thinker, has imagination, detects the vulnerable spot in any man and can plan cold-bloodedly to hit it. He did his own sizing up and soon doped out just what to do to me in order to reduce me to complete inoffensiveness in the market. He did not actually do me out of any money. On the contrary, he was to all appearances extremely nice about it. He loved his sister, Mrs. Marquand, and he did his duty toward her as he saw it.

XIV

It has always rankled in my mind that after I left Williamson & Brown’s office the cream was off the market. We ran smack into a long moneyless period; four mighty lean years. There was not a penny to be made. As Billy Henriquez once said, “It was the kind of market in which not even a skunk could make a scent.”

It looked to me as though I was in Dutch with destiny. It might have been the plan of Providence to chasten me, but really I had not been filled with such pride as called for a fall. I had not committed any of those speculative sins which a trader must expiate on the debtor side of the account. I was not guilty of a typical sucker play. What I had done, or, rather, what I had left undone, was something for which I would have received praise and not blame--north of Forty-second Street. In Wall Street it was absurd and costly. But by far the worst thing about it was the tendency it had to make a man a little less inclined to permit himself human feelings in the ticker district.

I left Williamson’s and tried other brokers’ offices. In every one of them I lost money. It served me right, because I was trying to force the market into giving me what it didn’t have to give--to wit, opportunities for making money. I did not find any trouble in getting credit, because those who knew me had faith in me. You can get an idea of how strong their confidence was when I tell you that when I finally stopped trading on credit I owed well over one million dollars.

The trouble was not that I had lost my grip but that during those four wretched years the opportunities for making money simply didn’t exist. Still I plugged along, trying to make a stake and succeeding only in increasing my indebtedness. After I ceased trading on my own hook because I wouldn’t owe my friends any more money I made a living handling accounts for people who believed I knew the game well enough to beat it even in a dull market. For my services I received a percentage of the profits--when there were any. That is how I lived. Well, say that is how I sustained life.