 Richard Whitney |
| |
|
| Nickname: |
The “savior” of the NYSE |
| Background: |
His father was a prominent banker, putting
him in the Boston elite. Whitney attended Groton and Harvard, where he was a member of the
highly prestigious Porcelland Club. |
| Market: |
Bonds |
| Birthplace: |
Beverly, Massachusetts on August 1, 1888. |
| Greatest Wealth: |
Unknown. Ironically, Whitney is known
for his immense debt rather than extravagant wealth. |
| |
|
| 1910: |
Moved to New York City and started his own bond brokerage firm,
Richard Whitney & Co., with his brother George. |
| 1912: |
Bought a seat on the New York Stock Exchange. |
| 1915: |
Became a principal broker at J.P. Morgan and Company. |
| 1916: |
Married Gertrude Sheldon Sands, a young widow, whose father was
a very prominent figure in the New York social scene as well as president of the Union League Club. |
| 1917: |
Entered Wall Street and soon his success eclipsed that of During
World War I, he was an executive at the Food Administration, headed by Herbert Hoover, in Washington,
D.C. |
| 1919: |
Elected to the board of governors of the New York Stock Exchange. |
| 1923: |
Appointed as treasurer of the New York Yacht Club. |
| 1929: |
Became vice president and acting president of the NYSE. At
the time of the crash, Whitney met with many leading Wall Street bankers and became the man who
was sent into the pit to place orders from a “pool” of $130 million ($1,404,611,388
adjusted for inflation) in an attempt to revive the market. After walking onto the
floor around 1:30 PM, he famously proclaimed “I bid 205 for 10,000 steel,” and did the
same for many other blue chip companies. |
| 1930: |
Elected president of the exchange, and would remain so for five
consecutive years. His actions on the floor during the market crash made him an instant media
celebrity. |
| 1931: |
Testified in front of the Pecora Commission as the representative
for “The Old Guard” mentality; he urged the government, in agreement with his colleagues,
to not impose new regulations on the market. His personal debt was estimated at $2 million
($22,163,493 adjusted for inflation), a result of notoriously poor investing habits. |
| 1938: |
The comptroller at the NYSE reported that Whitney was an embezzler
and that his company was insolvent. Within days, Whitney’s company declared bankruptcy. In
addition to his company’s failure, the New York County District Attorney charged Whitney
with embezzlement. At his trial, Whitney pleaded guilty to the charges and was sentenced
to a term of five to ten years at Sing Sing on April 8. His fame quickly turned to infamy
as six thousand people turned out at Grand Central Station to watch him be escorted in handcuffs
onto the train that would take him to prison. Whitney was found to have “borrowed” upwards
of $30 million ($324,141,089 adjusted for inflation) from friends, family and
clients, which he had been doing since 1926. |
| 1939: |
Whitney declared bankruptcy with about $6.5 million ($83,664,755
adjusted for inflation) worth of debt to his name. |
| 1942: |
Whitney was released from prison and returned to Massachusetts,
where he settled down with his wife on a family-owned dairy farm in Barnstable. All debts
were eventually paid off through the selling all of his assets (except for his wife’s jewels,
which she refused to relinquish). |
| 1974: |
Died on a friend’s farm in Short Hills, New Jersey, on
December 5. |
| |
| Richard Whitney on the November 9, 1929 issue of Time Magazine. |
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Profiled by: Jacob Spencer |
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