Tuesday, September 24, 2019

Today is the 150th Anniversary of "Black Friday" and the Destruction of the Gould - Fisk Gold Market Corner

There's even a song!
(see after the jump)

From History.com:
...By September 24, 1869—the day that would become known as “Black Friday”—the hubbub over gold had reached a fever pitch. Mobs of spectators and reporters gathered near Wall Street, and many of the Gold Room’s indebted speculators walked to work like men on their way to the gallows. Gold had closed the previous day at $144 ½, but shortly after trading resumed, it took a tremendous leap to $160. Unaware that the game might soon be up, Fisk continued buying like a madman and bragged that gold would soon top $200.

In Washington, D.C., Ulysses S. Grant resolved to bust Gould and Fisk’s corner on the gold market. Shortly before noon, he met with Treasury Secretary George Boutwell, who had been following the chaos via telegraph. After a brief conversation, Grant ordered Boutwell to open his vaults and flood the market. A few minutes later, Boutwell wired New York and announced the Treasury would sell a whopping $4 million in gold the following day.

Along with finally loosening Gould and Fisk’s grasp on the gold market, the news sent Wall Street into a tailspin. “Possibly no avalanche ever swept with more terrible violence,” the New York Herald later wrote. Within minutes, the inflated gold prices plummeted from $160 to $133. The stock market joined in on the plunge, dropping a full 20 percentage points and bankrupting or inflicting severe damage on some of Wall Street’s most venerable firms. Thousands of speculators were left financially ruined, and at least one committed suicide. Foreign trade ground to a halt. Farmers may have felt the squeeze most of all, with many seeing the value of their wheat and corn harvests dip by 50 percent....MUCH MORE
Via PBS's The American Experience: 

Scene in the New York Gold room during the excitement of September 24th, 1869. Library of Congress.

From the U.S. Library of Congress:

[New York Gold Room bulletin board on Black Friday, Sept. 24, 1869]
Photograph of the black board in the New York Gold Room, September 24, 1869, showing the collapse of the price of gold. Handwritten caption by James A. Garfield indicates it was used as evidence before the Committee of Banking & Currency during hearings in 1870.
Contributor Names
Garfield, James A. (James Abram), 1831-1881.
Created / Published
From our 2017 post "Black Friday Stuff:

....E. C. Stedman, a poet and broker(!), wrote the following:
One Hundred and Sixty! Can’t be true!
What will the bears-at-forty do?
How will the merchants pay their dues?
How will the country stand the news?...

*The song refers to Black Friday, September 24, 1869 when an attempted corner of the gold market by James Fisk and Jay Gould was broken by the Federales.
When Black Friday comes
I'll stand down by the door
And catch the gray men
When they dive from the fourteenth floor
When Black Friday comes
I'll collect everything I'm owed
And before my friends find out
I'll be on the road
When Black Friday falls you know it's got to be
Don't let it fall on me...