 | CHAPTER VI. Bankrupt stories |  |
6. CHAPTER VI.
WILL BE DEVOTED TO BUSINESS.
THE merchants of old times held their fortunes by most
ticklish tenures, and what with water rats and land rats,
water thieves, and land thieves, merchandising was an uncertain
business enough as we know; but the cords which fastened
their purses then, when every man was his own banker,
were chain-cables compared with the cob-webs to which a merchant
of our own day must trust for security. The new firm
had been in operation less than a month when they lost nearly
one half their capital by the faliure of the Real Estate and
State Stock Banking Association. Tom Tuck had selected out
this Bank for keeping their principal account, upon a secret
arrangement with the president of it that he should be chosen
a Director to fill the first vacancy that should occur in the
board, and before they had had an opportunity, or occasion, to
withdraw a quarter of their funds, the bank failed, and its affairs
were placed in the hands of receivers appointed by the
Chancellor. In addition to this very serious loss, the Financier's
Wall street speculations had turned out badly, and to
make good his deficiencies and sustain his credit in that quarter,
he was forced to draw largely from the funds of the firm,
which he had no right to do; but as he had entire control of
the finances, he kept this a secret, and that he might retrieve
stocks on time to a frightful extent. But still the capital of
the firm was large, even with these deductions, and amply
sufficient to meet all their engagements, and better than all,
their credit was good for a very large amount. John was
frightened at their loss by the failure of the Real Estate and
State Stock Association, and cautioned his partners to be prudent
in their private expenses, and requested the Financier to
distribute his deposites among four or five banks for fear of
accidents.
But their great loss and the caution of his partner had but
small effect upon Fred Tuck. A young gentleman of his elegant
tastes could not curtail his expenses; it was a low-lived
and vulgar thought, and he contented himself with the reflection
that when the worst did come, he would marry some rich
girl and live upon her income in a genteel quiet way in the
country. For the present he was amusing himself by building
a little box on Long Island, for a summer residence for
himself and a few of his elegant friends; he called it a box
merely because it is a grand thing to apply diminutive
epithets to such great affairs as common people would distinguish
by magnificent names, but his architect, a gentleman
of distinguished taste, who had been to Europe and was consequently
au fait at everything, called it the “beau ideal of a
gentleman's villa.” It was in the Gothic style, built of brown
free stone, and decorated with fine carvings and a great profusion
of stained glass. Very Gothic indeed. It was fit for
almost anything but the purpose for which it was intended.
The cost of this box was very great, and as Fred could not
pay for it by making direct drafts upon the firm he raised the
the money by discounting the notes of the firm, through a
broker in Wall street, and paid them when due by renewals, at
an exorbitant rate of interest. He also kept a carriage, three
horses, a groom and a tiger, besides other necessaries that we
must not name, and defrayed the cost of them in the same
fashionable church, became a member of the jocky club, and
took an interest in several joint stock companies, of which he
was made a director. He was first on the list on all complimentary
benefit occasions, and never failed to do the genteel
thing whenever his name could be put into the papers. His
mother idolized him, and did what she could, in her womanly
way, to stimulate and emulate him, but his brother Tom had
no sympathy with them. He was devoted to business, and
the only change that he made in his manner of living was to
keep a saddle horse and a valet; but his private speculations in
Wall street continued to make losses, and all the purchases for
account of the firm had left heavy balances on the wrong side.
They had a ship bound from Malaga with an entire cargo of
fruit abandoned in mid ocean, she having sprung a leak; she
was insured at the Occidental Office, but before the insurance
fell due, the company broke, and the insurance was lost.
This was a small matter, however. They shipped a cargo of
cotton to Liverpool, upon which they received an advance
of two-thirds the amout of the invoice, and were afterwards
drawn upon for something more than eight thousand pounds
sterling to make good the deficiency in the nett proceeds
short of the advances. This was a serious loss, and what
made it worse, was the fact that it was reported on `change,'
and cast a slight shade upon their credit; and they had the
mortification to hear that their paper had been refused at
one of the banks. As soon as the financier heard of it, he
immediately offered to discount it for less than bank interest,
his offer was greedily accepted, and it being a large
note they had not sufficient money to pay it; they were
obliged therefore to submit to a shave, and it fell to John's
turn to negotiate a loan. Tom directed him to the Brothers
Mildmen, a pair of the smoothest, plumpest, and best
dressed gentlemen in Wall street, who occupied a little dark
office in the base ment of a very high brick building, and
in the quietest, genteelest, and most comfortable manner conceivable.
It so happened that they were the very brokers
who had been employed by Fred to dispose of his accommodation
notes, and therefore they were well acquainted with the
paper offered, and were able to state without hesitation the
terms on which it could be done. John felt himself peculiarly
fortunate in having fallen into their hands, for it is assuredly
better to be shaved by a keen smooth razor than by a
rough and rusty one, but when “brother Peter,” the oldest
and portliest of the Messers Mildmen, named nine per cent
per month and one per cent commission, he started back with
amazement, and returned to the financier and told him that
they must not submit to such extortion. But his partner
convinced him that it would be to their advantage to do so;
for it was not to be debated that their credit was of infinitely
greater importance than the comparatively trifling loss they
would sustain by paying even so large a discount to sustain
it. So John returned to the Brothers Mildmen, and the negotiation
was completed on the terms named by brother Peter.
Resorting to bad expedients to maintain either your character
or your credit must always hasten on the catastrophe you
would avoid. This is a rule that has no exceptions. Let no
one, therefore, flatter himself that his case will prove one.
There is no man so cunning, so experienced, or so fortunate,
that he can with impunity violate a law of Nature; integrity
is the one necessary ingredient in busines without which success
is impossible; it is as essential as light and heat to vegetation.
But these common-places are already familiar to you.
We know that they are; but alas, and alas, that there should
be any necessity for repeating them.
Unfortunately for the credit of the new firm, the same
merchant who held the note which they had made so great a
sacrifice to discount, had purchased their other note through
the agency of the brothers Mildmen, and by this operation,
financial resources became known at the Bank of which the
accommodating merchant was a director, and from thence
was whispered around from one friend to another, in a confidential
way, until the circumstance was known to all the
monied men in Wall street. And, to their utter dismay and
disappointment, the new firm found that their stability was
suspected, in spite of their great exertions and sacrifices to
keep their credit unsullied. It chanced to be one of those
unlucky years when every body loses money, and a poverty-struck
feeling, for some unaccountable cause, pervades the
community. Prices of every thing fell; they were forced to
sell their stocks at a discount, and some of them proved nearly
worthless, such as the Cranberry Meadow Rail Road, of
which they held twelve thousand dollars, and the Fever
Swamp Canal, of which they luckily held but eight hundred.
Their shipments almost all turned out disastrously, and they
made many bad debts by failures at home. John grew
alarmed, for he saw his capital melting away at a fearful rate
but the Financier encouraged him, and proposed, by some
grand operation, to retrieve their losses. After much discussion
they at length agreed to make a speculation in coffee,
and having ascertained the precise number of bags in the
market, they determined to get the control of the whole, and
by that means raise the price; and by close figuring, Tom
demonstrated to his own satisfaction, and in a degree to the
satisfaction of John, that they could realise a profit nearly
equal to all their losses. Fred approved the scheme highly;
and he was anxious to have it carried into immediate execution,
for he began to experience some difficulty with the
Messrs. Mildmen in negotiating his accommodation notes, and
his gothic villa was not more than half completed. Money
he must have by some means or other, and his brother had
restricted him to an allowance immensely short of his wants.
He had serious thoughts of undertaking a speculation on his
all the brandy and champagne in the country. These
were articles of which he considered himself a very competent
judge, but he found upon making an attempt through the
agency of a broker, that time purchases could not be made to
any great extent and he abandoned the idea. The brothers
Mildmen positively refused to renew any more of his notes
without an endorser, and he was in an agony of apprehension
lest a knowledge of his transactions should reach his brother.
But he continued his building and contracted new debts, and
by some means succeded in getting his notes renewed by the
brothers Mildmen, and was as gay and as elegant as ever.
The coffee speculation was entered into as deeply as their
credit and means would allow, but in order to obtain possession
of certain small lots, they were compelled to pay very
high prices, and obtain the money by more discounts through
the agency of their gentlemanly friends, the Messrs Mildmen.
Other plans were projected and partially entered into, but the
coffee speculation was the great scheme upon which their
hopes chiefly rested, and as so large an operation took a long
time to carry out and wind up, before we acquaint the reader
with the result of it, we will return to other matters that require
our attention.
| CHAPTER VI. Bankrupt stories | |