Transcript
Introduction
"Jay Gould took time off from counting his money to have lunch at Delmonico's, the fanciest restaurant in town. While he was eating, a lawyer walked over to his table and punched him in the face. A series of spectacular financial triumphs had made Gould fabulously rich. Now at age 36, he was the most notorious businessmen in the country. Like others who tried to claw back money from Gould, the lawyer was getting nowhere in court. The laws were too weak, enforcement too lax and the judges too crooked. Gould had them in his pocket. This book seeks to explain Jay Gould and his underappreciated and aggressively maligned role in the country's transformative economic expansion of the 19th century. But it's just as much an exploration of Wall Street during its wild west era after the Civil War when by the rough means on display at Delmonico's, the seeds of our current financial system were planted.
Cornelius Vanderbilt, John D. Rockefeller, and Andrew Carnegie are not the focus of this book because they made their money in industry, not in finance. Vanderbilt toiled in steamships and railroads, Rockefeller in oil, and Carnegie in steel. Only the lesser-known figure of Jay Gould, as rich as any of them, was foremost a creature of Wall Street. To the extent Jay Gould is remembered, it's for Black Friday, the day he blew up the gold market and paralyzed the financial system. Lawyers swamped him with lawsuits, prosecutors hit him with subpoenas and Congress hauled him in for hearings.
This was as far as things got. Arrested three times, Jay Gould never spent a day in jail. Frustrated opponents turned to vigilante justice. One victim tossed Gould down a stairway. Another one pulled a gun on him. His peers were more charitable. Vanderbilt told a newspaper that Gould was the smartest man in America. Rockefeller, when asked who he thought had the best head for business answered, Jay Gould. They recognized Gould as a master of his craft. No one disputed that he was an extraordinary problem solver, an unparalleled negotiator, an expert communicator, a lightning-fast thinker and a masterful tactician with a staggering memory. He complemented his natural endowments with nerves of iron and a work ethic even as a teenager so strong that it damaged his health and quite possibly shortened his life.
With his mix of brains and single-mindedness, he was suited to make the most of the moment. But why does he matter? There's an easy answer. While he made his money on Wall Street, he did as much as anyone through his work with the railroads to build the country. “Railroads changed America in the 19th century, much as automobiles changed the country in the 20th century and the Internet has changed the 21st century and Gould knew how to play the game."
That was an excerpt from the absolutely fantastic book that I read this week and the one I'm going to talk to you about today, which is American Rascal: How Jay Gould Built Wall Street's Biggest Fortune and it was written by Greg Steinmetz. Okay. So I got to start by reading the inside flaps of this book, the inside cover of this book because it's absolutely -- it gives you an absolutely fantastic overview of the life and career of Jay Gould, and this is what it says. "He was richer than Rockefeller and so bare-knuckled that even Wall Street had to start making rules. Had he put his name on a university or a concert hall, he would undoubtedly be a household name today. The son of a poor farmer whose early life was marked by tragedy, Jay Gould saw money as a means to give his family a better life. Even if to do so, he had to pull a fast one on everyone else.