On October 14, 1907, the stock of United Copper Company soared past $62 a share. Two days later it closed at $15, and one F. Augustus Heinze was well on his way to financial ruin....Back in 2007 we wanted to note the anniversary of the Panic of 1907 and found that the Federal Reserve Bank of Boston had done it better, backwards and in heels:
April 9, 2007
Global Warming and Venture Capital
We're coming up on the 100th anniversary of the Panic of 1907 (Join our cult, get the calendar free!). The Boston Fed. did a great paper on the panic that should have gotten a wider audience.Here's the paper:
It's not that often you see a sub-head like "In Which the Downfall of a Prominent Speculator Rocks the Financial System, and a Prominent Millionaire Saves the Day" in a Fed. Bank Publication.
Rereading this got me thinking about the difference between J.P. Morgan (Our Hero), and the current crop of VC's flogging their new-found green credentials. Where were they six years ago? Oh, that's right: Webvan and Pets.com and Boo.com and Askme.com. Even Queer Company blew through $5 mil.
Compare that to Morgan six years prior to the Panic, during the Northern Pacific squeeze of ought-one. J.J. Hill flying across the country in a commandeered train, counting on one of the few guys on the planet who knew as much about railroads and financial markets as Hill himself (or for that matter as much as Hill's nemesis Ed Harriman- E.H., famous for saying "I can distribute more stock on upticks than I can on down"); some things never go out of style....
Panic of 1907
Federal Reserve Bank of Boston
Crash, Crash, Crash
Boston Post-October 19, 1907
Although the headline referred to events in New York, Boston Post readers knew exactly what it meant. Effects of the financial crisis were certain to reach beyond Wall Street....MORE