Gotham_ A History of New York City to 1898 - Edwin G. Burrows [827]
Grant turned the check over to Ward, who promptly cashed it, pocketed the funds, and prepared to flee the city. He didn’t move quickly enough. Fish announced the Marine Bank’s failure. Crowds of enraged depositors milled outside its closed doors, baying for Fish’s head. They organized a posse, captured Ward, and clapped both in Ludlow Street Jail. When word reached Grant at his G&W office, the stunned old man, a dead cigar clutched between his lips, hobbled out into the street and headed home, as cynical Wall Streeters doffed their hats out of respect for the tragedy unfolding before them.
More banks collapsed. Eminent directors were revealed to have stolen millions and plunged, ineptly, into railroad securities. Stocks nosedived. Panic swept the district. Brokerage houses failed. High rollers were laid low: Gould himself came close to collapse.
General Grant went bankrupt. The public, correctly convinced he had known nothing of his partner’s swindles, offered sympathy and cash. Grant, down to his last eighty dollars, accepted reluctantly. Greatly distressed about his debt to Vanderbilt, he signed over his properties, medals, and presidential memorabilia to the financier. Vanderbilt refused to accept them, until Grant pointed out that creditors would take them anyway; the magnate turned the medals over to the government.
Detail from The Panic of 1884, from Harper’s Weekly, May 24, 1884. (Library of Congress)
At this darkest hour Grant recalled a request by Century Magazine that he write articles on the Civil War. He produced a series of successful pieces, then landed a book contract for his memoirs. In 1885 Grant learned he had contracted terminal throat cancer. Despite great suffering, he pushed on and finished the book—later a spectacular success and the salvation of his heirs—before dying on July 23, 1885.
His adopted city did better by him in death than it had in life. Grant’s body lay in state at City Hall for three days, then embarked on a six-mile-long funeral procession through the city’s streets, past an estimated million and a half spectators, to a temporary tomb on Riverside Drive. The following year, the Department of Parks authorized creation of a permanent memorial and gravesite, and after April 27, 1897, when Grant’s Tomb was finally dedicated, the old soldier finally lay in peace beside the Hudson.
THE CORPORATE SOLUTION
The stock market chaos of 1884 proved less catastrophic than the breakdowns of 1819, 1837, 1857, and 1873—in part, the Nation observed, because previous crises had broken upon good times “like thunderclaps out of a clear sky.” In the mid-1880s, however, business had already slumped, and unemployment had risen to 7.5 percent from its normal 2.5 percent. The panic’s limited impact was also due to prompt and decisive action by the financial community itself, now far better prepared to meet such crises. The Clearing House pumped credit into the system, and dozens of banks and brokerage firms were hauled back from the precipice. One of the coolest and boldest players was J. P. Morgan, who stepped in and purchased stocks almost as fast as panicked speculators sold them, thus helping restore confidence. When the crisis passed, Morgan had emerged as Wall Street’s preeminent leader.
Morgan, chewing on his big cigar, surveyed the bloody economic battlefield from the mahogany partners’ room at 23 Wall and decided it was time to end the railroad wars. Morgan had himself participated in them vigorously, bankrolling combatants and mending casualties, both highly lucrative endeavors. But the London investors he represented were fed up, as he barked at one recalcitrant railroad president: “Your roads! Your roads belong to my clients!” With competitive conflagrations now threatening Wall Street itself, Morgan and other New York investment bankers decided to intervene aggressively.
On a hot and muggy July day in 1885 a clutch of railroad executives boarded Morgan’s 165-foot, black-hulled steam yacht, the Corsair. While the vessel cruised up and down the Hudson River, the banker spelled out his