My Adventures with Your Money

nance at

fifty miles-I decided to "take a look." So one evening, in the late Fall of 1904, I

was W. J. Arkell, formerly one of the ow

xclaimed. "What ar

ican Ice, and I'm broke. I am in hock to the hotel. T

r the quick putting on their feet of two Eastern rovers adrift in the big Coast city, and that night there was formed the W. J. Arkell Advertising Agency. Then the horse-tipp

ll," I said; "but no more

co papers. Capable clockers and handicappers were hired and some exc

somebody outside of the inner circle was getting the public's money, and every day that "Jack Hornaday" tipped a loser the Exami

SHIP OF P

ay" disconti

's associates in the Palace Hotel lobby, from time to time I naturally

h and be my press agent. We will get hold of a mining prope

know about mi

h in 'em to know a gre

I know nothing about the stock-brokerage business; s

," he replied. "I'll show

on," I said. "I am in for

ds and it wa

a trifle less than $150 in

ed out there, what wil

like us, wide awake and with phosphorus brains, get stranded

ur journey across the mountainous desert we looked out of the car window and saw trainload after trainload of what was said to be ore coming from the opposite dir

E TIGER ON

paulin. It was located 100 feet to the rear of the hotel, which was already crowded with miners and soldiers of fortune drawn from all quarters of the world by the mining excitement.

ng the tiger excitedly. In an hour the remnants of my $150 passed to the ownership of t

him. He lo

ted. "Better hi

kets, I remarked: "I've got a cane and an umbrella and three suits of clothes. Do

I present my card around this burg in the morni

men have a habit of do

er by the name of Malcolm Macdonald makes his headquarters over there and he wants to sell some

lions!" I

the facts and wire them to my

legraph in this town, and if you send any 'phony' telegrams over the

d he promptly. "Any message I

xed on the other end,"

pah Mining Company. The conversation was not more than five minutes old when Arkell suggested that he would like to eat breakfast, but "didn't want any restaurants in his," intimating that he would like to have some good, old-fashi

3,000,000

se had created-we returned to the office of the bank. There Arkell explained to Mr. Macdonald that he wanted "a big mining proposition or nothing." He said he represented big Eastern capital a

$32,000 for it. At that time there was a six-foot hole in the ground, and the whole property contained less than five acres.

along with some others, were promoted by Charles Minzesheimer & Company, a New York Stock Exchange house, as the Nevada Smelters & Mines Company and passed on to the public at

THE VISTA HE

ering. Then he and I held a consultation, and he vouchsafed the information that we would certain

d wind-swept mountain didn't enthuse me at all. I protested against the proposed trip to Goldfield, and

y the vendors of the mines and that our return trip to San Francisco would be delayed only one day. I left my gr

ot give $34 for the whole layout. And therein he was wise. The Simmerone was later capitalized for 1,000,000 shares, each share of a par value of $1, ballooned on

ld-a new, budding mining camp, at an altitude of 5,000 feet and

e en route to Goldfield. He said he would then go to San Francisco to promote it. The reason why he decided to handle the Tonopah Home, I afterward discovered, was that it was already i

or a few days until I can begin t

o Tonopah and from there to S

literally as well as figuratively. It was constructed of corrugated iron and tin. A few months

k and introduce me and I w

on what?"

and they wouldn't let one of my checks go to protest. Besides, I can get back to

an Eastern newspaper man, and then introduced W. J. Arkell

his paper for real money to the amoun

cross! I'm flat br

d, because he needed all of the

ST" VERSUS TE

considered a first-class human-interest story, and handed it to the owner and editor, "Jimmy" O'Brien. He thought it was fair writing, but not the sort of matter the Goldfield News wanted. It wanted technica

was discharged f

shipment of high-grade ore leaving the camp by mule-team was convincing. What probably impressed me most was the evident sincerity of the trail-blazers who had been on the ground since the day the camp was born. These men had suffered all kinds of hardships to hold their

nt became an

starting an advertising agency appealed to me strongly. Here was an opportunity for the great American spec

sk-room from the Goldfield Bank and Trust Company right in front of the cashier's counter, and secured the s

HE ADVERTIS

d-writing experience with the Maxim & Gay Company, in New York, that I could write money-getting advertising copy. Further, my experience in making contracts with advertising agents for the publ

e Mims-Sutro Company, a newly establish

ing about $100 a mont

exclaimed. "Why, you ought to b

hey began to believe in me. I wired to nearly all of the important city newspapers throughout the country for rates. After obtaining their replies I decided to spend $500 in the Chicago Sunday American, and $500 in the San Francisco Examiner in one issue. I f

ch as I always sent cash with the order, my copy was in great demand. Indeed, my agency was fairly inundated day after day with blank contracts from newspapers all over the country, the managers of which were

ERTISING

control of that firm fell into other hands and it ultimately went out of business. In the course of three years my advertising agency inserted in the neighborhood of $1,000,000 worth of advertising in the newspapers of the United States, chie

d never been a mine-promoter, and had never been in a mining camp before; but still, despite my utter lack

ey into Goldfield. The stock offerings undoubtedly struck a popular chord. Tens of thousands of people who for years had been imbibing the daily financial chronicles of the newspapers, but whose incomes were not sufficient to permit the

; and it frequently needed but the publication of a half-page advertisement in 40 or 50 big city newspapers, of a Sunday

nancial advertisers, was the endeavor first to get names of investors rather than immediate results from the advertisements, and to follow them up by correspondence. In spending the first $1,000

LD MINES WI

a news bureau as an adjunct

ing-stock brokers throughout the country that the news bureau was directly responsible for bringing into the State of Nevada tens of millions of doll

ldfield the "greatest gold camp on earth" came from the outside, and the news bureau secured it by focusing the attention of the American public on the great speculative possibilities of investments in the mining securities and leases of the camp. One of the leases, known

gent. I have always considered my work in this direction in the light of an

STORIES FOR D

ed with as much calculating judgment as it could have been were it subsidized by the most powerful interests in America. Human-interest stories that were written around the camp, its mines

ncy was observed, publishers were tempted by the news bureau wit

public interest appeared to lag, the wires were used by the camp's newspaper correspondents to obtain publicity for all kinds of sensational happenings that were common on the desert. Reports of gold discoveries, high play

lions. I could see no reason why Goldfield should not at least duplicate the history of Tonopah. Never in my life had I lived in an environment that inspirited me as this one. The visages of those around me were, as a rule, roughly hewn; the

ir money, in that the mines were going to be developed and many would make good, but that the opportunity for money-making, if embraced

URY OF S

. Terrific losses came eighteen months later, as a result of a madness of mining-stock speculation which followed on the heels of the great Mohawk boom and the merger of various Goldfield produ

ations. Within a year thereafter Goldfield Laguna sold at $2 a share on the San Francisco Stock Exchange, and was absorbed by

re were mining experts from Salt Lake, San Francisco and Colorado, and miners from every part of the Western mining empire; saloon-keepers from Alaska and Mexico; real-estate brokers

are for two or three blocks. The heavy traffic incident to hauling in supplies from Tonopah had ground the dirt of the street into an impalpable mass of dust to the depth of fifteen inches,

d barely met the requirements. The principal eating-place was the Mocha Café, which consisted of a 14 by 18 tent with an earthen floor and a roughly constructed lunch-counter

nightly and played faro, roulette and stud-poker, talked mines and mining, sold properties, and shielded themselves from the blasts that came with piercing intensity from the snow-capped peak

point of their "prospect" making good, but I argued to myself that if the chances of any mining prospect of this character proving to be a mine were only about one in 25 or one in 50, and my agency advertis

ased by an investor at 10 cents, he would have gained handsomely. Early purchasers of Mohawk gathered 200 to 1 for their money, many times more than could usually be won on a long shot at the horse-races, and not so ver

in two years thereafter from 8 cents to $5.50 per share; Daisy, which sky-rocketed from 10 cents to $6; Goldfield Mining, which soared from 10 cents to $2; Jumbo, which improved from 50 cents to $5; Jumbo Extension, which rose from 15 cents to above $3; Great Bend, which jumped from 20 cents to around $2.50; Silver

s, "wild-catting" became general from office buildings in the large cities. There were more than 2000 companies incorporated during this last period, not one of which made good, and the public lost from $150,000,000 to $200,000,000

ahead of

onths, and my campaign of publicity was beginning to gather momentum. The mines, h

TH OF B

h of Goldfield, was born. My publicity facilities were sought b

r, and we departed for Bullfrog. Elliott and his associates had staked out a townsite which they c

nopah, a gambling house which had lifted him from the impecunious tin-horn gambler class to the millionaire division; United States Senator George S. Nixon,[1] his partner; T. L. Oddie, late

nsolidated for about $150,000. It was incorporated for 2,000,000 shares of a par value of $1 each, a year late

rtner sold the control of the Amethyst to Malcolm Macdonald of Tonopah. Later, when Amethyst's neighbor, Montgomery-Shoshone, was selling at $20 per share, the market price of Amethyst was pushed up to above $1 a sha

ld make good, I disposed of on the San Francisco Stock Exchange at 40 cents a share, and I sold the

h the Montgomery-Shoshone mine. This property, in fact, was

mation was also forthcoming that the width of the ore-body was more than seventy feet. (It afterward turned out that the tunnel had been run along the ore-body and not acro

hat great treasure-house were mined, gold would be demonetized. As a matter of fact, the stories from my news bureau, picturing the riches of t

ructive. For purposes of exposition of pitfalls in mining-stock sp

e Tonopah Mining Company at a profit. It did not succeed. Oscar Adams Turner, of New York and Baltimore, the promoter of the highly successful Tonopah Mining Company, which to date has paid back to the original stockholders $16 for every $1

e highest standing, and has afterwards made good, particularl

HARLES M

ald and the owner of the other half interest, Bob Montgomery, sold a controlling interest to Mr. Schwab and associates for a sum which has never been made public. Mr. Schwab at once reorganized the company, took in two adjoining properties that w

roposition, for he loaned the company $500,0

uipment. Work on the property has been abando

be one of the sorriest failures in Nevada. The mine in six years produced $2,000,000 GROSS, and although mine and mill were operated in an economical way, the net proceeds from th

" and allowed his enthusiasm to run away with him, but the public suffe

ing the Montgomery-Shoshone at a valuation of $15 a share, or $7,500,000 for the property, afterward allowing the stock to be quoted up to $22 a share on th

s promotion. "Prospects" of this variety, according to approved mining experience, are sometimes entitled to appraisement of great prospective value when neighboring mines have demonstrated deep-seated enrichment. But there was

r recommending Montgomery-Shoshone for investment. Mr. Schwab, in hurriedly discussing the matter at the railroad station, was quoted to the effect that the property had been grossly misrepresented to him. This statement was widely published in Nevada. Thereupon, Don Gillies, Mr. Schwab's engineer in Nevada, who, with

interested party, and may have actually promoted the property on the strength of the unverified representations of the vendor. It might

d the property on the strength of them. A letter from Mr. Sch

Thomas Lockhart at 15 cents per share. The capitalization was 1,000,000 shares. John McKane interested Robert C. Hall, a member of the Pittsburg Stock Exchange, in the proposition. He, in turn, made a deal with Mr. Schwab. The stock was then sky-rocket

ed to pay as much as $1,000,000 in dividends, and a quite recent appraisement by Henry Krumb, a noted engineer, of the net value of the ore in sight in the mine did not place it at so much as

ied that he owned just as much stock after the market collapse as he did when he went into the enterprise. This was met with an allegation by some stockholders that while Mr. Schwab could probabl

er, and later mining editor of the Mining Financial News of New York when I was managing editor, denies personal guilt, although it lea

ES M.

BROA

W

ber 1

m C. D

he Tonop

ah, N

r Mr.

nd only leads to further discussion. But your paper heretofore has been so uniformly kind to me, so fair in every respect, and as I have always regarded you as a friend

ada. You seem to attack me because of this statement, and the strength of my position is ful

m John McKane $25,000 worth of stock of the Tonopah Extension M

part of that statement is correct. I never gave Mr. Hall any paper mill stock, nor did I buy 100,000 shares from him. The amount purchased from h

s absolutely untrue. I am holding to-day exactly the amount I held after all purchases were made by me, and from the beginning, aggregating some 285,000 shares, and I think if you take the trouble to look up the records you will find my statement in this c

ccurate. You say I sold a large block of Shoshone stock at $20 per share. This is also without any truth whatever. The fact is that 3,000 shar

uild the new mill, and I shall be glad to have any other stock

criticise state

tfully

) C. M.

sappointments to him, but that he did not lose any very large sum of money, and that the public did. His enemies go

t friends in Philadelphia, who knew as little about the game as he did, had made a fortune in Tonopah (on the advice of a man who did know) should not have influenced him. Because the Mizpah mine at Tonopah, promoted b

ment of more than $16,000,000, Mr. Schwab was in an i

enhancement of $8,000,000, it did not take much argument to get hi

failed to realize that his own great name was in large me

who subscribed for Montgomery-Shoshone stock on his recommendation, between $2,000,000 and $3,000,000. Th

tartling example of the danger in banking alone on an honored name for the success of an enterpr

that the promoter is ipso facto a crook. Big financiers are apt to make mistakes and so are little ones. Undoubtedly grave misrepresentations are made every day, and insidious methods are used to beguile you into forming a higher opinion regarding the me

BOTTOM

ion-share capitalization. A year later the price jumped to $2.65 on the San Francisco Stock Exchange, and the stock was widely distributed among invest

Steinway, Shoshone National Bank, Bullfrog Homestake, Bullfrog Extension, Denver Rush Extens

dated of Bullfrog to their clients. Pittsburg brokers recommended Montgomery-Shoshone. Butte brokers placed large blocks of Amethyst. Gold Bar was distributed by bro

the millions invested in B

too low to make the mines a commercial success. Bullfrog is situated on the desert and has no timber and but very little water. Promoters and investors did not realize this until mills were cons

confidence in Goldfield; and at the very time when the stocks of Goldfield representing inside properties, which later made good in an extraordinary way, were being offered, they advised their customers not to buy. The general cry then was that it was a fly

ldfield to go to Tonopah to make the Tonopah Home deal his cash capital was $35. He closed the transaction for the option on the million shares of Tonopah Home's capitaliza

opah Home on the San Francisco Stock Exchange. Then he started in to sky rocket the price. The ri

ogical moment fo

e quantity, for all cash through other brokers. This was equivalent to borrowing 66 2-3 per cent. of the market value. The brokers and banks did the carrying.

neered a consolidation. The Tonopah Home Consolidated was incorporated, and holders of Tonopah Home

n published as directors of the new company, and when these gentlemen saw the half-page display advertisements in which their names were use

thing like 3 cents a share. Then it dropped to nothing. Arkell's meth

boom seemed to be flickering. Work was going on day and night in the mines, but fo

as common bunco men. Peculiarly enough, Bullfrog, younger sister of Goldfield, which has since proved to be such a graveyard of mining hopes, was immune. There men of substance were in control, the writers said, while Goldfield was portrayed as a stamping ground for gamblers and "wil

eld, which followed, owes much of its success to these fortuitous

said it came from Manhattan and that Manhattan was another Cripple Creek. It was only the night before that I had lost a good many thousand dollars "bucking

e regulation Far-Western type, and started for Manhattan. We rode over a snow-clad desert, up mountains and down canyons-a perilous journey that I would not care to duplicate. The $10 I had in my pocket, after paying my fare, was borrowed money

. I questioned some of the prospectors as to the names of the single claims adjoining the Stray Dog, Jumping Jack and Dexter. They informed me that there was one group of claims adjoining that could be bought for $5,000. With $10 in my pocket I pr

placed on display in a jewelry store. There was great excitement, and before night a stampe

oration partnership in Goldfield with L. L. Patrick, one of the owners of the great Combination mine-which was later sold to the Goldfield Consolidated for $4,000,000-and Sol. Camp, a mining eng

he April Fool group of claims, scene of the original gold discovery. Twenty leases on this property were in operation, and the surface showings were promisin

ffering for sale stock of the Seyler-Humphrey. The entire issue of 1,000,000 shares of Seyler-Humphrey was oversubscribed at 25 cents a share within two weeks. This was the result of $15,000 worth of advertising, an

THE PUBLIC

250,000 from their three Manhattan promotions, whether he did not think the public was enti

ured hardships entitles us to a good profit, provided the gold showings on the surface of the properties are not exaggerated. The sale of the stocks has been accelerated by your gift of presentation throug

roperties don't ma

don't make good, one cent will be too high for them. So why question the ethics of charging 25 cents per share for Seyler-Humphrey when we might have sold it for 15 cents and still have made money; or of charging 15 cents for Manhattan Buffalo when we could have sold it at a profit for 10 cents? The public knows it is gambling. If people want to

o, then wrote out a list of stocks and prices, representing what he said was a "book" on s

Pric

ific $165

155.00

Pacific 5

28.00

mphrey .2

Buffalo

ombination

does who gives his broker an order to buy Union Pacific for him at current quotations. It is about 6 to 5 against the investment making a profit over current quotations on any given day, although the investor will hardly gain 6 for his 5 if the st

making money on Union Pacific on any given day a

'inside' manipulation, which has for its purpose the 'shaking out' of the speculator, has not got any chance! He is bound to lose his money

pah Club, then owned by George Wingfield and associates. When asked to settle he tendered a check for $5,000 and a certificate for 100,000 s

eorge Wingfield came to Tonopah in 1901 he brought with him $150, borrowed from George S. Nixon, then president of a national bank at Winnem

The best properties in Manhattan, by common consent, were the Stray Dog, the Jumping Jack and the Dexter. These were sure-enough producers of the yellow metal. They were shippers and were held in high esteem by mining men. I found it impossible to purchase the Dexter because the company was already promoted an

JACK M

nt of any other pastime, to play faro at night. I found myself gossiped about with men like January Jone

the copy for which had been carefully and methodically written in the back room of our Goldfield news bureau. Sullivan and Grant were making money, and plenty of it. I patronized the Sullivan house, of occasion, and Sullivan usually presided over the games

t you cut me in on some of y

$2,500 against that money

s sack containing $20 gold-pieces. Stacking the money o

?" sa

in the morning go by stage to Manhattan. When you get there look up the owner of the Jumping Jack mine. I have met him. He is a mem

I pay?" a

ut get it as cheap a

ith this

ntract to pay the balance in 60 or 90 days; but fetch

, aglow with excitement. Climbing out of the st

e's got the deeds. I bought the Jumping Jack for

!" I

y to the Jumping Jack Manhattan Mining Company, capitalized for 1,000,000 shares, 300,000 shares of which were placed in the treasury for mining purposes, and 70

ed what my next move would be. Sullivan seemed to be bewildered, yet full of faith. My situation was this: I had conceived a rip-snorting promotio

d manager of the Western

know h

arantee payment of any telegrams I file here to-night or du

hin a few minutes I was advised that

d offering short-time options on big blocks of the stock. The message was sent to practically all of the well-known brokerage houses in

ou intend to

f this community, and, besides, the Nye & Ormsby County Bank has agreed to receive subscriptions. Can you beat that for a layout? Never in my experience in this camp, with all the promotions I have advertised, has the public had a dish

stock in Jumping Jack Manhattan. In the morning I induced Sullivan to advance $10,000 to pay the advertising bills. The copy was dispa

e of their allotments in a few days. Within ten days after the initial offering of the promotion by telegraph to the Eastern brokers, Sullivan showed me telegraphic orders for 1,280,000 shares of Jumpin

partnership money, and within a fortnight we had made another small fortune from Manhattan sec

hamed to take the money. Manhattan Seyler-Humphrey stock, promoted by Patrick, Elliott & Camp at 25 cents pe

ew York, purporting to be signed by

hours on 200,000 shares of Manhattan Seyler-Humphr

thin half an hour a half-dozen similar

oldfield offerings of the stock at current quotations. At first Lou Bleakmore, manager for Patrick, Elliott & Camp, "smelled a rat," but when he learned that I was

n sent to brokers in San Francisco, where the stock was also listed. It seemed to me that an advance would certainly be recorded on the following day. Sure enough, the next morning the stock advanced to 38 cents a share, and the market boiled. At this figure, and a little higher, I unloaded in the neighborhood of 100,

from the sale of treasury stock, and paying off the amount still due on the original purchase pr

llivan when our joint profits r

Stay with it,

ield boom that followed and to mold for me an exciting career as a promoter, was formed with a p

1

ewspaper felicitated its owner and pronounced the appointment to be logical and deserved. Mr. Wingfield, however, after hearing from Washington as to the manner in wh