LITMIR.BIZ

      Chapter Four

      In the late 1920’s, Bill and Lois began to enjoy a new and exciting affluence. Like many speculators of that fevered time, Bill was a margin trader. He bought shares of stock by paying only a part of the actual price. If stock rose, his profits could be enormous. But if the price fell sharply, his equity in the stock was wiped out. He might even be called on to pay additional amounts to make up the deficit — called “covering the margin.” In the stock market debacle of 1929, the sudden drop in prices¹ itself drove prices even lower because of the panic selling to avoid further losses, or to obtain cash to cover margins on other holdings.

      Clint F., from Greenlawn, Long Island, New York, remembered the Bill of the Wall Street years:

      “I first met Bill Wilson at J. K. Rice Jr. and Co., 120 Broadway, New York City, a stockbroker firm specializing in speculative situations. My job was telephone trader during the Roaring Twenties, when Coolidge was President and Wall Street was the place to get rich quick.

      “Understandably, the climate was feverish in the financial district. This was the buildup of the nation’s first mammoth bull market. Anyone who did not join in the mass exuberance to the point of unbalance was simply not with it and was a little conspicuous. Such a one was a certain tall and loose-jointed character named Bill who worked on the outside as a special investigator for one of the partners of our firm, named Frank Shaw. This Bill was a mystery to me, because with all the shouting and scrambling going on in our office, he came in and went out with the grave dignity of a circuit judge. He did not mix with the crowd much and never joined the magpie chatter around the stock ticker. I learned about a year later that his investigations uncovered some of the most profitable situations the firm got into financially. And for some reason, he never took off his hat, a soggy brown box perched straight over his eyes.’’ (Clint’s memory was acutely accurate; all photographs of Bill wearing a hat show it squared away.)

      “A couple of years [after I met Bill], a split took place in the Rice firm. Bill’s boss Frank joined another stockbroker house, Tobey and Kirk, 25 Broad Street, taking Bill with him, as well as several traders, including me. I was drinking a little at the time and made some costly mistakes, which did me no good with Frank. However, I had little contact with Bill, who was a very busy guy then, and so I stumbled along in my own losing way, and married my lifelong gal, Katy. With good business sense, Frank fired me on my wedding day.

      “Up to the historic crash of 1929, everybody and his uncle seemed to be floating along to riches on the sweet euphoria of paper profits. I met Bill now and then, and although his appearance was unchanged, I knew he was going great and in on some deals with large promise. My own lack of big success depressed me, and I got a little morbid over the fact. My wife had been working in Macy’s since we were married, and still I could not catch on the big train the way Bill and others did. Perhaps my own [drinking] problem was catching up to me, if there was one. The fatal earthquake came and went in the stock market with a mark 8 on the Richter scale. The mighty were swept from their seats, and we of low degree went lower.”

      Back in 1927, the Wilsons had no premonition of disaster. Motorcycle travel had been abandoned in favor of transportation more befitting their new, higher standard of living; they could travel by car or rail; and there was money for hotels and entertainment. Although Bill drank heavily on some of these trips, he was able to complete excellent reports.

      He had begun to lie. With Lois, he was returning from a trip to Canada, where he had investigated an aluminum company development and had stayed sober the entire time. Just as they were about to cross the border back to the United States, Bill mentioned casually that he was going to stop to get cigarettes. “I realized this was nonsense, since cigarettes were more expensive in Canada,” Lois said. “But liquor was cheaper and more easily available than in the U.S. in those Prohibition days.”

      Parked in the plaza of the bridge that was the United States- Canadian border, she waited for hours; Bill had gone off with both money and car keys. Finally, she set out to look for him. “In the very last saloon in the area, there he was, hardly able to navigate. Our money had all but vanished.’’

      When Bill became interested in Cuban sugar, there was nothing for it but an on-site investigation. They had bought themselves a secondhand Dodge for $250, and this, outfitted for sleeping, took them in high style to Florida. It was the summer of 1927.

      In Cuba, they were given a warm reception and treated as important people. A car, a chauffeur, and a motorboat were placed at their disposal. In Havana, they stayed at the Hotel Sevilla. It was apparently above their means, judging from a letter Bill wrote to Frank Shaw in which he promised that they were “going to move to another place which will be more reasonable and which from now on will answer our purpose just as well.” According to Lois, they never did leave the Sevilla.

      Of that trip, Lois said, “It was a frustrating time for me, though, because of Bill’s drinking. One day, to keep him from going down to the bar, I threw one of his shoes out the window, but this did no good. It landed on a nearby roof, and Bill simply called the porter to retrieve it. In no time, he was down at the bar wearing both shoes.”

      In the same letter to Shaw, Bill addressed Shaw’s concern about his drinking:

      “Thank you for your remittance and your letter which followed. Now a few lines for your eyes alone. I have never said anything to you about the liquor question, but now that you mention it and also for the good reason that you are investing your perfectly good money in me, I am at last very happy to say that I have had a final showdown (with myself) on the matter. It has always been a very serious handicap to me, so that you can appreciate how glad I am to be finally rid of it. It got to the point where I had to decide whether to be a monkey or a man. I know it is going to be a tough job, but nevertheless the best thing I ever did for myself and everybody concerned. That is that, so let us now forget about it.”

      The letter was dated September 3, 1927.

      Bill made several visits to sugar plantations and sent in his reports. But those investigations were unsuccessful. To Lois, the reason seemed clear: Bill continued to drink during their entire month in Cuba.

      On their way home, they stopped to see Bill’s father and his second wife, Christine, in Miami Beach. Gilman had a contract to cut rock for the foundations of the Overseas Highway that would connect the Florida mainland with the Keys. On this visit, Bill also met the daughter of Gilman and Christine, his young half sister Helen, born in 1916.

      Back in New York, they rented an expensive three-room apartment at 38 Livingston Street, in one of Brooklyn’s good residential neighborhoods. Because it wasn’t big enough to satisfy Bill’s grandiose desires,

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