The chance at the good thing came along in due season. The New York
brokerage firm wrote Phillips concerning it. It appeared that there was
a certain railway stock named Central Midland Common. According to the
gossip on the street, Central Midland--called C. M. for short--was just
about due for a big rise. Certain eminent financiers and manipulators
were quietly buying and the road was to be developed and exploited. Only
a few, a select few, knew of this and so, obviously, now was the time to
get aboard. Kent asked questions. Was Egbert going to get aboard? Egbert
smilingly intimated that he was thinking of it. Would it be possible for
him, Kent, to get aboard at the same time? Well, it might be; Egbert
would think about that, too.
He did think about it and, as a result of his thinking, he and Kent
bought C. M. Common together. Of course to buy any amount worth while
would be impossible because of the small amount of ready cash possessed
by either. "But," said Phillips, "I seldom buy outright. The latest
quotation of C. M. is at 40, or thereabouts. I intend buying about two
hundred shares. That would be eight thousand dollars if I paid cash, but
of course I can't do that. I shall buy on a ten per cent margin, putting
up eight hundred. If it goes up twenty points I make two thousand
dollars. If it goes up fifty points, as they say it will, why----" And
so on.
It ended--or began--by Phillips and Kent buying, as partners, four
hundred shares of C. M. on a ten per cent margin. George turned over to
Egbert the eight hundred dollars in cash, and Egbert sent to the brokers
six hundred of those dollars and a bond, which he had in his
possession, for one thousand dollars. Yes, Kent, had seen the broker's
receipt. Yes, the bond was a good one; at least the brokers were
perfectly satisfied. Where did Egbert get the bond? Kent did not know.
It was one he owned, that is all he knew about it.
For a week or so after the purchase was made C. M. Common did continue
to rise in price. At one time they had a joint profit of nearly two
thousand dollars. Of course that seemed trifling compared with the
thousands they expected, and so they waited. Then the market slumped. In
two days their profit had gone and C. M. Common was selling several
points below the figure at which they purchased. By the end of the
fourth day, unless they wished to be wiped out altogether, additional
margin--another ten per cent--must be deposited immediately.
And to George Kent this seemed an impossibility because he had not
another eight hundred, or anything like it, of his own.
Public-domain text, read in full here on John Shaqi.
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