Essay about Trying to Corner the Gold Market on Black Friday

As a result of the market Crash on “Black Thursday”, October 24, 1929 The “Pecora Hearings” held in 1932 investigated the cause of the market crash of 1929 accusing commercial banks of misleading the public into investing in risky securities with poor quality (Calomiris, 2010)

They did so by buying and hoarding tons of gold and jacking up the prices dramatically

The Gold Standard was the framework by which the value of cash was characterized in terms of gold, for which the money could be traded. The Gold Standard ended up being deserted in the Depression of the 1930s. Friedman felt that,“The gold standard is not feasible because the mythology and beliefs required to make it effective do not exist. This conclusion is supported not only by the general historical evidence referred to but also by the specific experience of the United States” ( “The Gold Standard:Please Stop”).Economists who contradict the Gold Standard may perceive what must be accomplished with a specific end goal to make a centrally controlled paper standard better than a decentralized Gold Standard. Milton Friedman poses the key question: "How can we establish a monetary system that is stable, free from irresponsible tinkering, and

commission headed by George W. Curtis, but because of the president's increased trust in corrupt

The Coinage Act of 1873 was one of the major reasons why the Populist movement started and began forming. There were no real instant effects of the Coinage Act, and not many citizens in America used silver anyway (Friedman). Long term however, the United States would never be the same economically thanks to this monumental legislation. Officially accepting the Gold Standard, the American economy raised the demand for gold immensely, and as a result many gold deposits within America became depleted (Friedman). Consequently, the dollar and employees of America at the time became connected and tied to gold (Friedman). This was not a beneficial relationship, and the United States had become dependent on gold. Add in the fact that gold was being depleted rapidly and the demand for it was growing exponentially

He had little knowledge of politics, and depended on his fellow politicians. These men, in turn, involved in scandals to embezzle money from the government. One was the Great Mobilier scandal; it dealt with the Union Pacific Railroad. The Construction Company hired themselves at inflated prices to build railroad lines, and distributed shares of stock to congressmen. A scandal during Grant’s second term, was the Whisky Ring. This scandal was uncovered in St. Louis, and consisted of selling whiskey without the excise tax. In return it defrauded the government out of millions of dollars. Belknap was selling goods and trading with the Indians for lower prices.

Not mainly from their government paycheck but from the whispers of top CEOs and entrepreneurs of the main monopolies. Also, the government was very keen to stab the farmers in the back by not allowing silver as another main rare metal into the Federal Reserve for the backing of their money. The people demanded a “16 to 1” for the federal funding. This meant that 16 ounces of silver could be the same worth as 1 ounce of gold. James B Weaver was a strong supporter of this and wanted to eradicate the weapons of the big trusts that were violent threats of fraud, bribery, and pillage (Doc. F). J. Laurence Laughlin was very adamant about this by denouncing the cries of the farmers by saying that all people were feeling the pressure of the crisis but the introduction of silver into the US funding would not be a magic cure (Doc. E). Also in President McKinley’s acceptance speech, he also deems these cries empty and saying that time will heal all wounds (Doc. B). It would take more than just time to heal this gaping gouge into the body of the United States thanks to the knife of unilateral laws of congress and the interpretation of the Supreme Court.

During the building of the Transcontinental Railroad, the railroads themselves created a large market for the steel and iron industries.4 The steel and oil industries were booming and corruption was rampant. Andrew Carnegie had cornered the market in the steel industry and John D. Rockefeller had cornered the oil market. Rockefeller bought up his competition after essentially putting them out of business by flooding the market with refined oil bringing down prices and profits. He was determined to pay no one a profit because he wanted it all for himself. He created a plan called vertical integration which consolidated his businesses into one by creating The Standard Oil Trust.5 These two men became known as barons and got rich beyond belief. In 1890, the Government enacted the Sherman Anti-Trust Act to prevent large firms from controlling one single industry and finally put a stop to these monopolies and trusts, 6 but it was not rigorously enforced until the 1900’s. This act was designed to restore competition and

These two lucrative thought up a genius way to make huge profits with little risk to themselves. Their plan was to buy up a majority of the gold in circulation, cause the price of gold to go through the roof, then sell it off for massive profits. To pull it off, Gould enlisted the help of President Ulysses S. Grant's brother-in-law, Abel Corbin. Gould and Fisk met with Grant through Corbin's help numerous times. Their goal was to convince Grant to put a hold on government sale gold, because if people noticed that the price of gold was going up because of the lack of it on the market, the government could change that in an instant by flooding the market with gold, in turn ruining Gould and Fisk's plan. They effectively got their hands on control of the governments gold by convincing Grant to hire Daniel Butterfield as assistant Treasurer of the United States. Butterfield agreed to warn Gould and Fisk if the government was planning to sell gold in return for money. Finally, Gould and Fisk had all the pieces of their plan assembled. Now it was time for action. Together, Gould and Fisk started buying as much gold as they could. Combined they bought about 75% of the gold on the market. On September 20, 1869 gold prices rose 20%, causing huge ripples in the financial world. Everybody was unprepared for the sudden rise in prices and many firms

Reed Karaim in “Gold Grab” analyzes the relationship between robber barons Jay Gould and Jim Fisk. They were partners in crime. In 1869, they were working on a plan to rob the U.S. gold market. This article focuses on how Gould and Fisk use their connections with inside people including President Grant, to change gold prices. This led to the economy collapsing on September 24th, 1869, this day is famously known as Black Friday.

The Black Friday scandal also has another name it goes by people sometimes call it " Deadly Friday. " Two men tried to control the gold market of New York's gold exchange, these men were James Fisk and Jay Gould.The Black Friday scandal had another name as well it also went by the name of " Fisk-Gould Scandal. " The U.S. Government during the civil war gave out greenback which were backed out by nothing but credit. After the civil war most people believed that they could buy back the greenbacks with gold. Fisk and Gould tried to profit from this by cornering the gold market. They hired Abel Corbin Ulysses S. Grant's brother-in-law, and they hired him to get closer to Ulysses S. Grant to argue against him when the government discussed

Chapter 23: The "Bloody Shirt" Elects Grant Post-Civil War Reconstruction: Andrew Johnson was impeached and the Democrats/Republicans both nominated new candidates (Democrats - Horatio Seymour and Republicans - Ulysses S. Grant) Election of 1868: Grant was nominated by Republicans despite his lack of political experience (a war general) Due to his popularity in the North he had around 300,000 more popular votes than his opponent (turning point was the 500,000 votes of Blacks given to Grant: Republicans protected the voting rights of the freedmen) 15th amendment: Republicans passed this amendment to secure black voting rights...stated that states cannot prohibit a citizen’s right to vote despite race and color Republicans believed for continued

The Stock Market Crash occurred on October 29th, 1929. Wall Street got struck on Black Tuesday when, on the New York Stock Exchange, investors traded 16 million dollars worth of shares in one single day. Billions of dollars were cut, destroying the investments of thousands of investors. After the event of Black Tuesday, America’s industrial world spiraled downwards into the Great Depression. This was the most powerful and extended economic breakdown in the history of the Western Industrial world up till then.

First, I would like to consider the economic theory behind the gold rush and explain why on the surface; it is quite simple. Consider a modern theoretical case. Say a family of four is living in Cincinnati, Ohio and the main earner of the family works for a tool manufacturing company in Cincinnati. Suppose that the company decides during their yearly employee reviews that they aren’t going to give this certain individual a pay raise for the next year; also suppose that the employee does not see themselves climbing up the pay scale any further. Now suppose that this person is offered a thirty thousand dollar per year raise if they move out to Los Angeles, California for a new machine related job. Assuming

During 1893, the United States had suffered a serious economic depression known as the Panic of 1893. The economic panic had been caused by the overbuilding and over financing railroads, developing bank failures. These investments on the railroads had led to serious debates in Congress to attempt to improve the financial situation. In 1896, William Jennings Bryan had delivered a speech known as the Cross of Gold, supporting the “Free Silver” and bimetallism. Bryan’s audience reaction varied greatly, from hating Bryan to supporting Bryan for president. The speech had illuminated several important topics concerning “Free Silver”, gave popularity growth to Bryan, and the election of 1986.