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Dromo's Den
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[Up] [Dromo's Den] Jay Gould Biography GOULD, JAY (1836-92). An American capitalist, born in Roxbury, Delaware Co., N. Y. He passed his boyhood on his father's farm and was educated at Hobart Academy. In 1852 he entered a hardware store which his father had established; but although he did not neglect the business, his evenings were devoted to the study of surveying, at which he spent the years from 1852 to 1856, preparing and publishing maps of Albany and Delaware counties, of various counties in Ohio and Michigan, and of a proposed railway from Newburg to Syracuse. In 1856 he published a History of Delaware County. In the same year he engaged in the lumber and tanning business in western New York, selling out just before the panic of 1857 and removing to Stroudsburg, Pa., where he became the controlling director in a small bank. It was shortly after this that he first became interested in railroading. In the great financial depression following the panic of 1857 he disposed of his bank stock and bought a controlling interest in the Rutland and Washington Railroad running from Troy, N. Y., to Rutland, Vt., for 10 cents on the dollar. Of this company he became president, treasurer, and general manager, and subsequently brought about a consolidation of his road and the Rensselaer and Saratoga Railroad. In 1859 he sold out his stock in the consolidated roads at 120, and removed to New York, where he embarked in the brokerage business. He made a special study of railway stocks and set out to obtain control of the Erie Railroad, then in financial straits, and the object of strife between the Drew and Vanderbilt interests. By methods new in railway speculation, Gould secured control of the road, and in 1868 was elected its president. His administration of the road may, as he asserted have reclaimed it from bankruptcy, but it saddled it with a debt of $64,000,000 and resulted in its paying no dividends until 1891. The manipulation of the Erie was the first of a long series of speculations by which Gould obtained the mastery of some of the greatest railway corporations in the country. His method of obtaining control was the same in almost every instance: to depress the value of the stock which he sought to control and acquire the property during the period of depression. By these methods in the next few years he obtained control of the Union Pacific, which he held from 1873 to 1883, during which time the value of its stock rose from 15 to 75; of the Missouri Pacific, which under his management and by consolidation and extension developed from a short line 287 miles long with earnings of $280,000 a month to an immense system with earnings, before his death, stated at $5,100,000 a month; of the Wabash, the Texas Pacific, the St. Louis and Northern, and the St. Louis and San Francisco. In 1880 he controlled fully 10,000 miles of road, more than one-ninth of the mileage of the country. Gould also consolidated competing telegraph lines into the Western Union system in 1881 and obtained control of the Manhattan Elevated Railroad in the same year. What has been considered the most indefensible of all his actions was his entering with "Jim" Fisk, who was also his partner in some of his railroad deals, into a scheme to corner the gold market, which resulted in the disastrous "Black Friday" panic of 1869. The New International Encyclopaedia, Vol. X (New York: Dodd, Mead & Co., 1920) 189 |