The Titan

by Theodore Dreiser

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Chapter XLVII: American Match

Following Cowperwood's coup in securing cash by means of his seeming gift of three hundred thousand dollars for a telescope his enemies rested for a time, but only because of a lack of ideas wherewith to destroy him. Public sentiment—created by the newspapers—was still against him. Yet his franchises had still from eight to ten years to run, and meanwhile he might make himself unassailably powerful. For the present he was busy, surrounded by his engineers and managers and legal advisers, constructing his several elevated lines at a whirlwind rate. At the same time, through Videra, Kaffrath, and Addison, he was effecting a scheme of loaning money on call to the local Chicago banks—the very banks which were most opposed to him—so that in a crisis he could retaliate. By manipulating the vast quantity of stocks and bonds of which he was now the master he was making money hand over fist, his one rule being that six per cent. was enough to pay any holder who had merely purchased his stock as an outsider. It was most profitable to himself. When his stocks earned more than that he issued new ones, selling them on 'change and pocketing the difference. Out of the cash-drawers of his various companies he took immense sums, temporary loans, as it were, which later he had charged by his humble servitors to "construction," "equipment," or "operation." He was like a canny wolf prowling in a forest of trees of his own creation.

The weak note in this whole project of elevated lines was that for some time it was destined to be unprofitable. Its very competition tended to weaken the value of his surface-line companies. His holdings in these as well as in elevated-road shares were immense. If anything happened to cause them to fall in price immense numbers of these same stocks held by others would be thrown on the market, thus still further depreciating their value and compelling him to come into the market and buy. With the most painstaking care he began at once to pile up a reserve in government bonds for emergency purposes, which he decided should be not less than eight or nine million dollars, for he feared financial storms as well as financial reprisal, and where so much was at stake he did not propose to be caught napping.

At the time that Cowperwood first entered on elevated-road construction there was no evidence that any severe depression in the American money-market was imminent. But it was not long before a new difficulty began to appear. It was now the day of the trust in all its watery magnificence. Coal, iron, steel, oil, machinery, and a score of other commercial necessities had already been "trustified," and others, such as leather, shoes, cordage, and the like, were, almost hourly, being brought under the control of shrewd and ruthless men. Already in Chicago Schryhart, Hand, Arneel, Merrill, and a score of others were seeing their way to amazing profits by underwriting these ventures which required ready cash, and to which lesser magnates, content with a portion of the leavings of Dives's table, were glad to bring to their attention. On the other hand, in the nation at large there was growing up a feeling that at the top there were a set of giants—Titans—who, without heart or soul, and without any understanding of or sympathy with the condition of the rank and file, were setting forth to enchain and enslave them. The vast mass, writhing in ignorance and poverty, finally turned with pathetic fury to the cure-all of a political leader in the West. This latter prophet, seeing gold becoming scarcer and scarcer and the cash and credits of the land falling into the hands of a few who were manipulating them for their own benefit, had decided that what was needed was a greater volume of currency, so that credits would be easier and money cheaper to come by in the matter of interest. Silver, of which there was a superabundance in the mines, was to be coined at the ratio of sixteen dollars of silver for every one of gold in circulation, and the parity of the two metals maintained by fiat of government. Never again should the few be able to make a weapon of the people's medium of exchange in order to bring about their undoing. There was to be ample money, far beyond the control of central banks and the men in power over them. It was a splendid dream worthy of a charitable heart, but because of it a disturbing war for political control of the government was shortly threatened and soon began. The money element, sensing the danger of change involved in the theories of the new political leader, began to fight him and the element in the Democratic party which he represented. The rank and file of both parties—the more or less hungry and thirsty who lie ever at the bottom on both sides—hailed him as a heaven-sent deliverer, a new Moses come to lead them out of the wilderness of poverty and distress. Woe to the political leader who preaches a new doctrine of deliverance, and who, out of tenderness of heart, offers a panacea for human ills. His truly shall be a crown of thorns.

Cowperwood, no less than other men of wealth, was opposed to what he deemed a crack-brained idea—that of maintaining a parity between gold and silver by law. Confiscation was his word for it—the confiscation of the wealth of the few for the benefit of the many. Most of all was he opposed to it because he feared that this unrest, which was obviously growing, foreshadowed a class war in which investors would run to cover and money be locked in strong-boxes. At once he began to shorten sail, to invest only in the soundest securities, and to convert all his weaker ones into cash.

To meet current emergencies, however, he was compelled to borrow heavily here and there, and in doing so he was quick to note that those banks representing his enemies in Chicago and elsewhere were willing to accept his various stocks as collateral, providing he would accept loans subject to call. He did so gladly, at the same time suspecting Hand, Schryhart, Arneel, and Merrill of some scheme to wreck him, providing they could get him where the calling of his loans suddenly and in concert would financially embarrass him. "I think I know what that crew are up to," he once observed to Addison, at this period. "Well, they will have to rise very early in the morning if they catch me napping."

The thing that he suspected was really true. Schryhart, Hand, and Arneel, watching him through their agents and brokers, had soon discovered—in the very earliest phases of the silver agitation and before the real storm broke—that he was borrowing in New York, in London, in certain quarters of Chicago, and elsewhere. "It looks to me," said Schryhart, one day, to his friend Arneel, "as if our friend has gotten in a little too deep. He has overreached himself. These elevated-road schemes of his have eaten up too much capital. There is another election coming on next fall, and he knows we are going to fight tooth and nail. He needs money to electrify his surface lines. If we could trace out exactly where he stands, and where he has borrowed, we might know what to do."

"Unless I am greatly mistaken," replied Arneel, "he is in a tight place or is rapidly getting there. This silver agitation is beginning to weaken stocks and tighten money. I suggest that our banks here loan him all the money he wants on call. When the time comes, if he isn't ready, we can shut him up tighter than a drum. If we can pick up any other loans he's made anywhere else, well and good."

Mr. Arneel said this without a shadow of bitterness or humor. In some tight hour, perhaps, now fast approaching, Mr. Cowperwood would be promised salvation—"saved" on condition that he should leave Chicago forever. There were those who would take over his property in the interest of the city and upright government and administer it accordingly.

Unfortunately, at this very time Messrs. Hand, Schryhart, and Arneel were themselves concerned in a little venture to which the threatened silver agitation could bode nothing but ill. This concerned so simple a thing as matches, a commodity which at this time, along with many others, had been trustified and was yielding a fine profit. "American Match" was a stock which was already listed on every exchange and which was selling steadily around one hundred and twenty.

The geniuses who had first planned a combination of all match concerns and a monopoly of the trade in America were two men, Messrs. Hull and Stackpole—bankers and brokers, primarily. Mr. Phineas Hull was a small, ferret-like, calculating man with a sparse growth of dusty-brown hair and an eyelid, the right one, which was partially paralyzed and drooped heavily, giving him a characterful and yet at times a sinister expression.

His partner, Mr. Benoni Stackpole, had been once a stage-driver in Arkansas, and later a horse-trader. He was a man of great force and calculation—large, oleaginous, politic, and courageous. Without the ultimate brain capacity of such men as Arneel, Hand, and Merrill, he was, nevertheless, resourceful and able. He had started somewhat late in the race for wealth, but now, with all his strength, he was endeavoring to bring to fruition this plan which, with the aid of Hull, he had formulated. Inspired by the thought of great wealth, they had first secured control of the stock of one match company, and had then put themselves in a position to bargain with the owners of others. The patents and processes controlled by one company and another had been combined, and the field had been broadened as much as possible.

But to do all this a great deal of money had been required, much more than was in possession of either Hull or Stackpole. Both of them being Western men, they looked first to Western capital. Hand, Schryhart, Arneel, and Merrill were in turn appealed to, and great blocks of the new stock were sold to them at inside figures. By the means thus afforded the combination proceeded apace. Patents for exclusive processes were taken over from all sides, and the idea of invading Europe and eventually controlling the market of the world had its inception. At the same time it occurred to each and all of their lordly patrons that it would be a splendid thing if the stock they had purchased at forty-five, and which was now selling in open market at one hundred and twenty, should go to three hundred, where, if these monopolistic dreams were true, it properly belonged. A little more of this stock—the destiny of which at this time seemed sure and splendid—would not be amiss. And so there began a quiet campaign on the part of each capitalist to gather enough of it to realize a true fortune on the rise.

A game of this kind is never played with the remainder of the financial community entirely unaware of what is on foot. In the inner circles of brokerage life rumors were soon abroad that a tremendous boom was in store for American Match. Cowperwood heard of it through Addison, always at the center of financial rumor, and the two of them bought heavily, though not so heavily but that they could clear out at any time with at least a slight margin in their favor. During a period of eight months the stock slowly moved upward, finally crossing the two-hundred mark and reaching two-twenty, at which figure both Addison and Cowperwood sold, realizing nearly a million between them on their investment.

In the mean time the foreshadowed political storm was brewing. At first a cloud no larger than a man's hand, it matured swiftly in the late months of 1895, and by the spring of 1896 it had become portentous and was ready to burst. With the climacteric nomination of the "Apostle of Free Silver" for President of the United States, which followed in July, a chill settled down over the conservative and financial elements of the country. What Cowperwood had wisely proceeded to do months before, others less far-seeing, from Maine to California and from the Gulf to Canada, began to do now. Bank-deposits were in part withdrawn; feeble or uncertain securities were thrown upon the market. All at once Schryhart, Arneel, Hand, and Merrill realized that they were in more or less of a trap in regard to their large holdings in American Match. Having gathered vast quantities of this stock, which had been issued in blocks of millions, it was now necessary to sustain the market or sell at a loss. Since money was needed by many holders, and this stock was selling at two-twenty, telegraphic orders began to pour in from all parts of the country to sell on the Chicago Exchange, where the deal was being engineered and where the market obviously existed. All of the instigators of the deal conferred, and decided to sustain the market. Messrs. Hull and Stackpole, being the nominal heads of the trust, were delegated to buy, they in turn calling on the principal investors to take their share, pro rata. Hand, Schryhart, Arneel, and Merrill, weighted with this inpouring flood of stock, which they had to take at two-twenty, hurried to their favorite banks, hypothecating vast quantities at one-fifty and over, and using the money so obtained to take care of the additional shares which they were compelled to buy.

At last, however, their favorite banks were full to overflowing and at the danger-point. They could take no more.

"No, no, no!" Hand declared to Phineas Hull over the 'phone. "I can't risk another dollar in this venture, and I won't! It's a perfect proposition. I realize all its merits just as well as you do. But enough is enough. I tell you a financial slump is coming. That's the reason all this stock is coming out now. I am willing to protect my interests in this thing up to a certain point. As I told you, I agree not to throw a single share on the market of all that I now have. But more than that I cannot do. The other gentlemen in this agreement will have to protect themselves as best they can. I have other things to look out for that are just as important to me, and more so, than American Match."

It was the same with Mr. Schryhart, who, stroking a crisp, black mustache, was wondering whether he had not better throw over what holdings he had and clear out; however, he feared the rage of Hand and Arneel for breaking the market and thus bringing on a local panic. It was risky business. Arneel and Merrill finally agreed to hold firm to what they had; but, as they told Mr. Hull, nothing could induce them to "protect" another share, come what might.

In this crisis naturally Messrs. Hull and Stackpole—estimable gentlemen both—were greatly depressed. By no means so wealthy as their lofty patrons, their private fortunes were in much greater jeopardy. They were eager to make any port in so black a storm. Witness, then, the arrival of Benoni Stackpole at the office of Frank Algernon Cowperwood. He was at the end of his tether, and Cowperwood was the only really rich man in the city not yet involved in this speculation. In the beginning he had heard both Hand and Schryhart say that they did not care to become involved if Cowperwood was in any way, shape, or manner to be included, but that had been over a year ago, and Schryhart and Hand were now, as it were, leaving both him and his partner to their fates. They could have no objection to his dealing with Cowperwood in this crisis if he could make sure that the magnate would not sell him out. Mr. Stackpole was six feet one in his socks and weighed two hundred and thirty pounds. Clad in a brown linen suit and straw hat (for it was late July), he carried a palm-leaf fan as well as his troublesome stocks in a small yellow leather bag. He was wet with perspiration and in a gloomy state of mind. Failure was staring him in the face—giant failure. If American Match fell below two hundred he would have to close his doors as banker and broker and, in view of what he was carrying, he and Hull would fail for approximately twenty million dollars. Messrs. Hand, Schryhart, Arneel, and Merrill would lose in the neighborhood of six or eight millions between them. The local banks would suffer in proportion, though not nearly so severely, for, loaning at one-fifty, they would only sacrifice the difference between that and the lowest point to which the stock might fall.

Cowperwood eyed the new-comer, when he entered, with an equivocal eye, for he knew well now what was coming. Only a few days before he had predicted an eventual smash to Addison.

"Mr. Cowperwood," began Stackpole, "in this bag I have fifteen thousand shares of American Match, par value one million five hundred thousand dollars, market value three million three hundred thousand at this moment, and worth every cent of three hundred dollars a share and more. I don't know how closely you have been following the developments of American Match. We own all the patents on labor-saving machines and, what's more, we're just about to close contracts with Italy and France to lease our machines and processes to them for pretty nearly one million dollars a year each. We're dickering with Austria and England, and of course we'll take up other countries later. The American Match Company will yet make matches for the whole world, whether I'm connected with it or not. This silver agitation has caught us right in mid-ocean, and we're having a little trouble weathering the storm. I'm a perfectly frank man when it comes to close business relations of this kind, and I'm going to tell you just how things stand. If we can scull over this rough place that has come up on account of the silver agitation our stock will go to three hundred before the first of the year. Now, if you want to take it you can have it outright at one hundred and fifty dollars—that is, providing you'll agree not to throw any of it back on the market before next December; or, if you won't promise that" (he paused to see if by any chance he could read Cowperwood's inscrutable face) "I want you to loan me one hundred and fifty dollars a share on these for thirty days at least at ten or fifteen, or whatever rate you care to fix."

Cowperwood interlocked his fingers and twiddled his thumbs as he contemplated this latest evidence of earthly difficulty and uncertainty. Time and chance certainly happened to all men, and here was one opportunity of paying out those who had been nagging him. To take this stock at one-fifty on loan and peddle it out swiftly and fully at two-twenty or less would bring American Match crumbling about their ears. When it was selling at one-fifty or less he could buy it back, pocket his profit, complete his deal with Mr. Stackpole, pocket his interest, and smile like the well-fed cat in the fable. It was as simple as twiddling his thumbs, which he was now doing.

"Who has been backing this stock here in Chicago besides yourself and Mr. Hull?" he asked, pleasantly. "I think that I already know, but I should like to be certain if you have no objection."

"None in the least, none in the least," replied Mr. Stackpole, accommodatingly. "Mr. Hand, Mr. Schryhart, Mr. Arneel, and Mr. Merrill."

"That is what I thought," commented Cowperwood, easily. "They can't take this up for you? Is that it? Saturated?"

"Saturated," agreed Mr. Stackpole, dully. "But there's one thing I'd have to stipulate in accepting a loan on these. Not a share must be thrown on the market, or, at least, not before I have failed to respond to your call. I have understood that there is a little feeling between you and Mr. Hand and the other gentlemen I have mentioned. But, as I say—and I'm talking perfectly frankly now—I'm in a corner, and it's any port in a storm. If you want to help me I'll make the best terms I can, and I won't forget the favor."

He opened the bag and began to take out the securities—long greenish-yellow bundles, tightly gripped in the center by thick elastic bands. They were in bundles of one thousand shares each. Since Stackpole half proffered them to him, Cowperwood took them in one hand and lightly weighed them up and down.

"I'm sorry, Mr. Stackpole," he said, sympathetically, after a moment of apparent reflection, "but I cannot possibly help you in this matter. I'm too involved in other things myself, and I do not often indulge in stock-peculations of any kind. I have no particular malice toward any one of the gentlemen you mention. I do not trouble to dislike all who dislike me. I might, of course, if I chose, take these stocks and pay them out and throw them on the market to-morrow, but I have no desire to do anything of the sort. I only wish I could help you, and if I thought I could carry them safely for three or four months I would. As it is—" He lifted his eyebrows sympathetically. "Have you tried all the bankers in town?"

"Practically every one."

"And they can't help you?"

"They are carrying all they can stand now."

"Too bad. I'm sorry, very. By the way, do you happen, by any chance, to know Mr. Millard Bailey or Mr. Edwin Kaffrath?"

"No, I don't," replied Stackpole, hopefully.

"Well, now, there are two men who are much richer than is generally supposed. They often have very large sums at their disposal. You might look them up on a chance. Then there's my friend Videra. I don't know how he is fixed at present. You can always find him at the Twelfth Ward Bank. He might be inclined to take a good portion of that—I don't know. He's much better off than most people seem to think. I wonder you haven't been directed to some one of these men before." (As a matter of fact, no one of the individuals in question would have been interested to take a dollar of this loan except on Cowperwood's order, but Stackpole had no reason for knowing this. They were not prominently identified with the magnate.)

"Thank you very much. I will," observed Stackpole, restoring his undesired stocks to his bag.

Cowperwood, with an admirable show of courtesy, called a stenographer, and pretended to secure for his guest the home addresses of these gentlemen. He then bade Mr. Stackpole an encouraging farewell. The distrait promoter at once decided to try not only Bailey and Kaffrath, but Videra; but even as he drove toward the office of the first-mentioned Cowperwood was personally busy reaching him by telephone.

"I say, Bailey," he called, when he had secured the wealthy lumberman on the wire, "Benoni Stackpole, of Hull & Stackpole, was here to see me just now."


"He has with him fifteen thousand shares of American Match—par value one hundred, market value to-day two-twenty."


"He is trying to hypothecate the lot or any part of it at one-fifty."


"You know what the trouble with American Match is, don't you?"

"No. I only know it's being driven up to where it is now by a bull campaign."

"Well, listen to me. It's going to break. American Match is going to bust."


"But I want you to loan this man five hundred thousand dollars at one-twenty or less and then recommend that he go to Edwin Kaffrath or Anton Videra for the balance."

"But, Frank, I haven't any five hundred thousand to spare. You say American Match is going to bust."

"I know you haven't, but draw the check on the Chicago Trust, and Addison will honor it. Send the stock to me and forget all about it. I will do the rest. But under no circumstances mention my name, and don't appear too eager. Not more than one-twenty at the outside, do you hear? and less if you can get it. You recognize my voice, do you?"


"Drive over afterward if you have time and let me know what happens."

"Very good," commented Mr. Bailey, in a businesslike way.

Cowperwood next called for Mr. Kaffrath. Conversing to similar effect with that individual and with Videra, before three-quarters of an hour Cowperwood had arranged completely for Mr. Stackpole's tour. He was to have his total loan at one-twenty or less. Checks were to be forthcoming at once. Different banks were to be drawn on—banks other than the Chicago Trust Company. Cowperwood would see, in some roundabout way, that these checks were promptly honored, whether the cash was there or not. In each case the hypothecated stocks were to be sent to him. Then, having seen to the perfecting of this little programme, and that the banks to be drawn upon in this connection understood perfectly that the checks in question were guaranteed by him or others, he sat down to await the arrival of his henchmen and the turning of the stock into his private safe.

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