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The Rich Man s Panic 27<br />
Roosevelt was not due back until Thursday, the twenty-fourth. Cortelyou<br />
hesitated, but in the end agreed to deposit $25 million of government<br />
funds in various New York banks.* Having gained this much, Morgan<br />
went off to bed, leaving his partner, George Perkins, and Oakleigh<br />
Thorne, president of the Trust Company of America, to draft a formal<br />
agreement on the undertakings. Somewhere around 1 A.M. on the morning<br />
ofWednesday, October 23, Perkins gave out a statement that read in<br />
part:<br />
The chiefsore point is the Trust Company ofAmerica. The conferees feel<br />
that the situation there is such that the company is sound. Provision has been<br />
made to supply all the cash needed this morning ... The company has $12<br />
million cash and as much more as needed has been pledged for this purpose.<br />
It is safe to assume that J. P. Morgan and Company will be leaders in this<br />
movement to furnish funds. 6<br />
It was not a diplomatic statement, or as reassuring as it was intended<br />
to be. The reference to the Trust Company ofAmerica as the "chiefsore<br />
point" was not one to allay distrust among the bank's depositors, despite<br />
the promise of support. When the bank opened, the street before the<br />
bank was jammed with depositors with their pass books. The line continued<br />
to grow and at one o'clock extended east to William Street and<br />
down almost to Exchange Place. On the Exchange a frantic selling was<br />
going on, and call money reached go per cent, but the Exchange did not<br />
have to close. Fresh money came in-$5 million from the National City<br />
at around two o'clock-and quotations steadied. All day long the Trust<br />
Company continued to payout cash, preserving as much as possible the<br />
routine ofa normal day. Three o'clock came, and to accommodate those<br />
who had not yet been able to present their drafts, the bank kept its doors<br />
open a little longer.<br />
Two hours after closing, porters fromJ. P. Morgan & Co. carried a big<br />
tin box and several bags into the bank. No explanation was made; none<br />
was needed. Vice president Babcock announced during the evening:<br />
"After one of the most remarkable runs in the history of banking, we<br />
will open our doors as usual tomorrow. We paid all checks today as fast<br />
as they were presented, and will do so tomorrow. The Trust Company<br />
of America is perfectly solvent. . . ."<br />
*A niggardly amount considering the fact that the Treasury at the time held over $300<br />
million in free gold (not required for the redemption of gold certificates) and nearly $50<br />
million in other forms of money-sums equal to more than 20 per cent of all gold in the<br />
country, 10 per cent of the total money stock and well over a third of the total deposit<br />
liabilities of all the New York clearing house banks. 7
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