CHAPTER IV.
SPECULATION.
A few months afterwards, when Mr. Townsend had, from repeated failures to realize anticipated gains in commerce, grown distrustful of the means of prosperity so long successfully applied, he listened with more interest to what Cleveland had to say about the new roads to wealth that had been opened.
“Depend upon it, Townsend,” said the individual to him, one day, “that you are standing still, while other men are seizing upon the golden opportunities that offer themselves on every hand. Times have greatly changed. A new order of things prevails. Wealth is no longer to be gained in the old channels, or, at least, not without twenty times the labor required in the new channels. Notwithstanding your want of confidence in my ‘Sandy Hill and Dismal Lake Canal’ stock, I managed it just as I said I would. I controlled the Board and had the excavations entered upon with great vigor. I had an office procured in a public location, where a clerk was placed, and every thing reduced to an active business aspect. I secured one or two editors in favor of the work, and got one or two shrewd brokers interested in the stock. Every thing went on just as I desired. The price advanced steadily until about ten days ago, when it reached the maximum of my wishes, since which time I have been selling it as fast as I can without creating suspicion. The stock is still firm. In a week or ten days more I shall not own a share, and then the company can take care of its own interests.”
“And you will have cleared fifty thousand dollars by the operation?”
“Yes, every cent of it.”
“I can hardly credit it.”
“I bought for eighty cents, and am selling for a dollar and thirty. You can make the calculation yourself. And what is more than all this, Mr. Townsend, I have not had to use ten thousand dollars real money from beginning to end. My credit was enough. Although such a handsome profit has been made, only two or three of the first notes given for the stock have fallen due.”
“You sold on time?”
“Certainly. But the notes of such men as D—— and P——, J. S——, and L——, are as good as so much gold, any day.”
“It’s surprising,” remarked Townsend, thoughtfully.
“But no more so than true,” said Cleveland, in a confident voice. “Now is the time for a man who possesses good credit and a clear head to make or double his fortune. I shall treble mine, and you can easily do the same, and this, too, without interfering at all with your regular business operations. Mine go on the same as usual.”
Mr. Cleveland believed what he said. But he was slightly mistaken. To these grand speculating schemes he gave up all his own thoughts and attention, and left his regular business in charge of his eldest clerk, in whom he had unlimited confidence. He was satisfied to believe that every thing was conducted as well as it could have been done, if he had given to it all his personal attention. In this, however, he was in error.
Mr. Townsend hardly knew what to think. His confidence in the old way that he had been for years pursuing, was impaired, and in spite of his better judgment, confidence in the new way was gaining strength. It occurred to him that he might be neglecting, unwisely, to improve the golden opportunities that were presenting themselves every day, because they did not exactly accord with his old notions of business. He remembered how successful he had been, many years before, in speculating in flour and cotton, and then asked himself why he might not be quite as successful, if he tried his hand in some of the many money-making schemes that were put in operation all around him.
Another disastrous voyage, which no human foresight could have prevented, completely unsettled his mind, and, in this state, with a kind of bewildered desperation, he stepped aside from the old beaten way, into one of the many paths that diverged towards the mountains of wealth that were seen in the distance, towering up to the skies.
Cleveland, like a tempting spirit, was near him to suggest the path he should take. Stocks, Townsend had a prejudice against, except United States Bank stock, and in that there was not sufficient fluctuation in the price to make its purchase desirable. As a safe investment of money, he would have preferred it to almost any thing else; but as a matter of speculation, the inducements were not strong.
“I do not like to have any thing to do with stocks,” he said to Cleveland, who proposed their buying up a majority of the stock of a broken bank, the charter of which was perpetual, and embraced several advantages not usually possessed by banking institutions. “To me there is something intangible about them. A ship, a bale of cotton, or a piece of real estate, have a certain value in themselves; will always bring a certain price; but scrip is merely a representative of property that may or may not exist. You are never certain about it.”
“You may be certain enough. As to the Eagle Bank stock, it may be had for thirty cents on the dollar, and, by proper management, in twelve months, or even a less time, be made worth, in the market, from seventy to eighty cents, or even par. It has been done with the People’s Bank, and can and will be done with this. I know several monied men who are beginning to turn their thoughts towards this charter, and if we don’t take hold of the matter at once, the opportunity will pass by. Another such a chance is not likely soon to offer.”
Mr. Townsend, with all his love of money, had a certain degree of integrity about him, more the result of education as a merchant of the old school than any thing else. The scheme proposed, he took a day to reflect on, seriously. He looked at it in its incipiency, progress, and termination, and saw that, although he might make twenty or thirty thousand dollars, by selling off his stock when it had reached the highest price to which their forcing system could raise it, others would lose all he made; for the stock must inevitably fall in price. In fact, he saw that he would make himself a party to a fraud upon the public, and this he was unwilling to do. So he refused to enter into this scheme. Cleveland then proposed to sell him out his interest in “Eldorado,” that he might have more means, and a freer mind, to enter into the Eagle Bank speculation—a thing that he said he was determined to do.
“I have already sold lots enough to pay for the original purchase, and now own nearly half of the town,” he said.
“What will you take for your interest?” Mr. Townsend asked.
“Forty thousand dollars; and I wouldn’t part with it for less than double the price, were it not for my determination to push through this matter of the Eagle Bank. In six months you can sell lots enough to clear the whole purchase, and still be owner of at least a third of the town. Come into my counting-room, and let me point out to you the singular advantages that ‘Eldorado’ possesses.”
Mr. Townsend went to the store of the ardent speculator, to look at the city on paper. There stood “Eldorado,” all laid off into streets and city squares, with churches and public buildings scattered about it quite thickly. In the centre was a large depot, where two extensive lines of railroad crossed each other at right angles; and upon each, at points east, west, north, and south, were long trains of passenger and burden cars, gliding towards, or rushing away from the city. Across the stream, upon the banks of which it stood, dams had been thrown, and flour-mills and extensive factories were seen, admirably located, and furnished with water-power that was inexhaustible.
“All this,” said Cleveland, sweeping his hand around an imaginary vast extent of country to the southwest of “Eldorado,” “is a wheat-growing country, one of the finest in the world. From sixty to a hundred bushels to the acre is the common yield. The mills will, therefore, always have the fullest supply of grain. And this,” sweeping his hand as before, but to the north of the city, “is a hilly country, admirable for sheep, and the farmers are already finding it to their advantage to graze them. Along the rich vallies that lie to the east, millions of bushels of corn and thousands of head of cattle are annually raised, for which ‘Eldorado’ will be the great entrepot. In five years from this time, I prophesy that it will be the third city in the State, and, in ten years, but little behind any city in the West.”
And thus Cleveland continued to show the superior advantages possessed by “Eldorado.” About a city with its houses, public squares, churches, mill sites, etc., there was something more real to the mind of the merchant, than about stocks in banks, railroads, or canals, and he felt much better pleased with “Eldorado” than he did with the Eagle Bank.
After considering the matter for a week, and holding several long conversations with large holders of lots in “Eldorado,” Mr. Townsend concluded to purchase out Cleveland’s entire interest, and then turn his attention towards forwarding the improvements already begun. This intention was put into execution forthwith. All the necessary papers were drawn, and duly recorded, and the plan of “Eldorado” transferred from the walls of Mr. Cleveland’s counting-room, to those of Mr. Townsend. Previous to this, the notes of the latter for the large sum of forty thousand dollars, passed into the hands of the former, and were immediately converted into cash.