The Past, Reimagined
How The Wall Street Journal of 2014 might have covered the news of July 8, 1889.
By JASON ZWEIG
July 7, 2014 4:38 p.m. ET
HARTFORD, Conn.— Mark Twain, America’s most celebrated author, can earn up to $25,000 a month in lecture fees and royalties from his books. He lives in a luxurious mansion in an exclusive neighborhood here in one of the country’s richest cities.
That isn’t enough for the novelist and humorist; he wants to be filthy, stinking rich.
Samuel L. Clemens, as he is known in real life, is an avid inventor, speculator and entrepreneur. He holds three U.S. patents and has bought the rights to several more. He develops obsessive enthusiasms for marketing such peculiar inventions as a pair of grape scissors, a self-pasting scrapbook, a chalk-based printing process, an improved bed clamp to keep children from kicking off their blankets and a steamboat paddle wheel that could cut through the ice floes of the Arctic. He regularly sinks thousands of dollars at a time—a huge sum for an individual—into stocks that catch his fancy.
Mr. Clemens, who has traveled tens of thousands of miles in his lifetime, has tried to form financing syndicates with bankers to fund the construction of a railway network in China and a railroad line that would connect Constantinople with the Persian Gulf. He thinks nothing of spending $25,000 or more to back ventures hawking steam pulleys or new techniques of marine telegraphy. In 1883 Mr. Clemens became obsessed with what he called “The History Game,” a combination of a playing board, chart and factual pamphlet that he believed would turn every student into a master historian. He put off writing “Adventures of Huckleberry Finn” for months to work on it.
Mr. Clemens is the biggest backer of the Paige typesetting machine, a potentially transformative device for the printing industry, into which he has sunk the staggering sum of nearly $170,000.
Mr. Clemens began investing in the typesetter around 1879. “I took $2,000 of the stock,” he later recalled. “I was always taking little chances like that; and almost always losing by it, too– a thing which I did not greatly mind, because I was always careful to risk only such amounts as I could easily afford to lose.”
Pumping more than $4,000 a month into developing the typesetter has driven Mr. Clemens to the brink of bankruptcy, according to people familiar with the matter. Experts on printing equipment say the Paige machine is so complicated it might never work. Officially Mr. Clemens calls it “very much the best investment I have ever made,” although his friends Andrew Carnegie and Henry H. Rogers, one of John D. Rockefeller’s top executives at the Standard Oil Co., have refused to sign on.
An active stock speculator, Mr. Clemens is always on the prowl for new ideas for his portfolio. He has quipped, “There are two times in a man’s life when he should not speculate: when he can’t afford it, and when he can.” But Mr. Clemens has also told his friend, the novelist William Dean Howells, “I must speculate in something, such being my nature.” He regularly gossips with Dean Sage, one of Wall Street’s leading traders, about hot stock tips. Mr. Clemens has complained of a setback in Denver & Rio Grande Western Railway shares when he got word too late that rumors of a merger had fallen through. That, he said, “means a loss of $1600, if I were forced to sell now— which I ain’t.”
But in many ways Mr. Clemens is a hapless player in the market, incapable of resisting any stock that sounds like a lottery ticket. In 1871 he bought a sheaf of claims to South African diamond mines that turned out to yield nothing but sand. Nearly a decade ago, enticed by grandiose promises from the promoters, he bought $5,000 of shares in the Independent Watch Co. of Fredonia, N.Y. Later, desperate to sell the stock at any price, he wrote a mock newspaper advertisement reading in part, “Make me an offer (an exorbitant one not required).” In 1874, Mr. Clemens put $23,000 into shares of the Hartford Accident Insurance Co., which went bust less than two years later; Mr. Clemens was saved only when one of the company’s backers secretly bailed out the writer’s losses. For no discernible reason, he invested in the New York Vaporizing Co., whose value promptly vaporized.
Mr. Clemens laughs off his losses, but there is anger in his guffaws. He calls margin “mud,” brokers “stock-meddlers” and the executives of telephone companies “chartered robbers.” Habitually scrawling German phrases in his notebooks as he practices the language, Mr. Clemens recently wrote: Das Bank Theilen verkaufen (an imperfect attempt to say “sell the bank shares”).
In 1883, on another tip from Mr. Sage, Mr. Clemens spent $21,900 to buy 300 shares of the Oregon & Transcontinental Co. on margin. The “O&T” railroad, founded by Henry Villard, the rail promoter and publisher of the Nation and the New York Evening Post, was on a roll. The shares went from $73 to $98, but Mr. Sage was ill at the time and couldn’t give Mr. Clemens any “points,” or advice.
So the writer hung on, depositing more margin and buying even more shares. Before long, O&T sank below $16. Disgusted, Mr. Clemens told his nephew to figure out whether to sell or hold, adding that he didn’t “wish to ever look at a stock report again.” Mr. Clemens finally got out in May 1884 at $12 per share, at an estimated loss of at least $18,000. He was so incensed by the experience that he toyed with writing a play about it.
Mr. Clemens trades frequently, often to no avail. On Oct. 18, 1883 he bought 200 shares of St. Paul Roller Mill Co., the flour producer, for around $94, as well as 100 shares of the Missouri Pacific Railway Co. at $91½. He bought another 100 shares of each on April 10, 1884 at around $86 a share.
By May 3, he finished selling out. His total proceeds: $41,362.50. Altogether, the shares had cost him $45,237.50, not counting commissions.
When the giant telegraph company’s stock dropped in 1884, Mr. Clemens sputtered, “Damn that Western Union,” jokingly ordering his business manager to put in “a permanent order to sell it” at $60.
According to a person familiar with Mr. Clemens’s thinking, the writer’s obsession with getting rich is rooted in his past. In 1862, while covering the silver rush in Nevada as a journalist for the Virginia City Territorial Enterprise, Mr. Clemens moonlighted as a miner. One day, he and his partner struck a rich vein of silver ore. Mr. Clemens was so excited by hitting the jackpot, he recalled in his 1872 book “Roughing It,” that he stayed up all night “just as if an electric battery had been applied to me.” The young reporter fantasized so vividly about the two-acre estate he would build in the heart of San Francisco, and the three-year tour of Europe he would take, that “my visions of the future whirled me bodily over in bed.”
For 10 exhilarating days, Mr. Clemens was a paper multimillionaire. Then the partners’ claim was invalidated on a legal technicality. “Sick, grieved, broken-hearted,” recalled Mr. Clemens, he returned to the working world. But, according to the person familiar with the matter, the writer has never since been able to abandon the quest to reclaim that elation.
In recent years Mr. Clemens seems to have forgotten the scathing contempt he voiced for wealth earlier in his career. In “The Revised Catechism,” a newspaper satire published in 1871, he wrote: “What is the chief end of man? — to get rich. In what way? — dishonestly if we can; honestly if we must. Who is God, the one only and true? Money is God.”
The words Mr. Clemens addressed to Commodore Cornelius Vanderbilt in a magazine article in 1869 have come back to haunt the great author: “You have got seventy millions, and you need five hundred millions, and are really suffering for it. Your poverty is something appalling.”
Source: The Wall Street Journal