Islands -- Fiction; Love stories; New England -- Fiction; Swindlers and swindling -- Fiction
"It's a swindle, pure and simple," he said in confidence to Nickerson,
"and while Weston is willing to dupe the confiding investors he has
persuaded to buy the stock, the real end and aim of his scheme is to get
the street short of it and, by some sort of scare, start the bears to
bidding against each other, and when the right time comes Simmons will
appear on the scene and unload Rockhaven at top price. How soon that
time will come and how far up they will push the stock before the shorts
take fright, is a guess. It is now steady at six and not much interest
in it. Then again it's an open question how much stock is owned on the
street and how great a short interest has been created. No one has any
confidence in it, and yet many are ready to take a flyer in it for a
turn. My idea is to handle it as one would a hot horseshoe. I am long a
thousand or two, you are ditto for five hundred, and we hold fifteen
hundred in trust for your friend Hardy and this islander, Hutton.
Whether to unload now and make four points or hold for a big stake, is
the question. It's a gamble either way."
And this, be it said, fairly represented the situation.
But Simmons, who really held the key to this well-set trap, knew very
well that he had the street all guessing, and more than that, was just
the man to keep them at it. He sold and he bought a little stock each
day, just to keep it active and quoted. He could have bought every share
on the street if necessary, but that was not his game. What he did want
was to aid the bull pool that had been formed, for every share they
bought meant one more short of that share, and when the time came, one
more scared bear to bid it up. It was an unscrupulous scheme, but one
continually being worked in one way or another by these legalized
gamblers.
Then, as if the devil came to Simmons's aid, Rockhaven began to be
quoted in the bucket shops, and the crowd there, as usual, were all
bulls. It is a strange fact, but true, that every lamb who goes into one
of these wool-shearing offices is always sure to buy, expecting an
advance. With him, stocks are bound to advance--never go down. If they
do, he feels it's only for the time being, and they must go up again,
and so he foolishly puts up more margins, and still more, and the crafty
thief who manages this robber's den assures him he is right; they are
bound to go up, and in privacy smiles at the innocence of his victim.
And so the shearing goes on.
Public-domain text, read in full here on John Shaqi.
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