VOObyM

Reminiscences of a Stock Operator
think they felt that I was bound to be right again very shortly and they knew that with
my habit of pushing my luck all I needed was a start and I'd more than recover what I
had lost. They had made a great deal of money out of my trading and they would make
more. So there was no trouble about my being able to trade there again as long as my
credit stood high.
The succession of spankings I had received made me less aggressively cocksure;
perhaps I should say less careless, for of course I knew I was just so much nearer to the
smash. All I could do was wait watchfully, as I should have done before plunging. It
wasn't a case of locking the stable after the horse was stolen. I simply had to be sure, the
next time I tried. If a man didn't make mistakes he'd own the world in a month. But if he
didn't profit by his mistakes he wouldn't own a blessed thing.
Well, sir, one fine morning I came downtown feeling cocksure once more. There wasn't
any doubt this time. I had read an advertisement in the financial pages of all the
newspapers that was the high sign I hadn't had the sense to wait for before plunging. It
was the announcement of a new issue of stock by the Northern Pacific and Great
Northern roads. The payments were to be made on the installment plan for the
convenience of the stockholders. This consideration was something new in Wall Street.
It struck me as more than ominous.
For years the unfailing bull item on Great Northern preferred had been the
announcement that another melon was to be cut, said melon consisting of the right of the
lucky stockholders to subscribe at par to a new issue of Great Northern stock. These
rights were valuable, since the market price was always way above par. But now the
money market was such that the most powerful banking houses in the country were none
too sure the stockholders would be able to pay cash for the bargain. And Great Northern
preferred was selling at about 330!
As soon as I got to the office I told Ed Harding, "The time to sell is right now. This is
when I should have begun. Just look at that ad, will you?"
He had seen it. I pointed out what the bankers' confession amounted to in my opinion,
but he couldn't quite see the big break right on top of us. He thought it better to wait
before putting out a very big short line by reason of the market's habit of having big
rallies. If I waited prices might be lower, but the operation would be safer.
- 78 -