Wednesday, November 2, 2011
We Make Money the Old Fashioned Way
Great Crash of '29
Some people made money the old-fashioned way during the crash — i.e., by stealing it. After the initial crisis on Black Thursday, a group of high-powered bankers tried to stabilize the market by using a $130 million pool of funds to buy stocks, sometimes at prices above market value. A member of the group, Albert H. Wiggin, head of Chase National Bank, began short selling his own portfolio at the same time he was committing his bank's money to buying. He shorted more than 42,000 shares, making more than $4 million. Because he used a Canadian shell company to buy the stocks, he didn't even pay taxes on his gains. Though forced to resign in disgrace, Wiggin otherwise went unpunished and got to keep the money, the jerk.
Great Crash of '08
Take it away, David....