Commentary: In 1887, the grim harvest of the Reaper King

Writer’s Note: An invitation from Kevin Rose of the Turner Foundation to participate in a recent Pecha Kucha event with the theme of time travel took me back to two fascinating weeks in Springfield history. Finding new details that involved my dual interests in history and journalism, I decided to share what I found in today’s column.

The first news of the collapse of the corner on the wheat market at Chicago’s Board of Trade was printed in June 14, 1887 of the Springfield Daily Republic.

It would be another 10 days before the community realized the speculation that led to the market collapse would cause the financial collapse of the company that had put Springfield on the map as the Champion City.

But even before the dust from the 15-cent-per-bushel drop in wheat had begun to settle, the Associated Press Chicago Bureau focused on a man at the epicenter of the emerging financial disaster.

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At first reading, there seemed no reason for the focus on trader Eggleston Kershaw. He appeared to be no more than one of a long list of speculators facing financial ruin in a game that was often played, a game that works this way:

Say you and your pals controlled millions of bushels of wheat and could control whether the price of the entire market would go up or down. With this “corner” on the market, your own moves to cause even a 5- or 10- cent shift would allow you to profit 5 to 10 cents on each of the millions of bushels you owned.

It was simple math. The more the shifts, the more the money. And, for a time, it provided not just good but very, very good for the clique. But when it turned bad, it turned horrid.

In a story filed June 15, AP exposed the skullduggery of the ruined speculators and, in so doing, answered the question of why it had focused on Kershaw in the first place.

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The AP reported that Cincinnatian Joe Wilshire temporarily ensured Kershaw’s solvency the morning he left an 8 a.m. meeting with Kershaw and associates at the American Exchange Bank and “walked to the corner of Dearborn and Monroe streets.”

There, “he met a young fellow who had accompanied him on the train and whose pockets bulged.”

Perhaps at the advice of an attorney, AP did not say the pockets bulged with cash. Nor did it explain why an AP reporter, or perhaps a source, had either followed Kershaw or known to wait outside the bank to see what might occur. It did report Wilshire’s return to the bank and the news that, 30 minutes later, “Kershaw had the money to pay his differences and the market (trading) margins.”

The story estimated the worth of the bulges at $1 million.

The juicy news was of general interest to Springfielders and anyone else following the wheat market collapse. But it seemed to have no more immediate local impact than another AP story about the attempted suicide of “dashing stock and provision speculator” and Californian Walter Wade on the eve of his planned wedding in Glenville, Pa.

“Recent ill luck in the speculative field drove him to despair,” the wire story reported, and instead of celebrating a new marriage to one Miss Eckert, Wade “now lies hopelessly insane at the home of his parents.”

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The first inkling most Springfielders had of approaching disaster came around this time under the headline “The Fidelity Fizzles.” The story described bank examiners’ sudden shuttering of Cincinnati’s Fidelity National Bank for reasons unknown.

The last paragraph of an updated story in the same edition reported that Fidelity Vice President E.L. Harper was calling himself a “ruined man.” Harper’s name was well known in Springfield, as was the bank’s for the business it did with both local banks and companies.

As a result, the next day, the Fidelity’s fizzle had become “The Fidelity Crash,” and under that headline, the Republic asked the question of the day: “Will the failure of the Fidelity bank at Cincinnati have any effect locally?

“Very little,” one official said, though when pressed for details, he added, “I guess the Whiteleys were the heaviest local depositors, but I have reason to believe that they will not lose much by this break.”

Brothers William and Amos Whiteley, owners of Whiteley, Fassler & Kelly, were by then three years into operation of the mammoth East Street Works, the largest manufacturing concern under a single roof on the continent. The facility was Reaper King William Whiteley’s vision for how his Champion reapers could continue to compete against those made by companies in Chicago in a new era of agricultural manufacturing.

Most of those quoted near the beginning of the story minimized the bank’s failure, but these less assuring words from the reporter followed:

“The writer in his younger years, had a personal acquaintance with E.L. Harper … by long odds the most prominent figure in this great crash. He is well known to a large number in Springfield and his history reads like a romance novel. Throughout his life this one predominant characteristic showed itself - he was a brilliant, cool and audacious investor of money at big risks.

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“He was a gambler by instinct - not a card gambler or a man that played bank or poker as a profession - but a nervy, sagacious speculator, who put in big money where others would hesitate to invents small accounts and who was usually phenomenally successful. He was a man of comparative small education, and the whole truth of the present situation lies in a nutshell - he came to a point at last where he simply overplayed his caliber.” Perhaps less noticed that day was an unnerving detail in an AP story from Cincinnati. There, at the Fidelity, a bank examiner expressed amazement on being shown “a load of pencil memorandums reading: Wilshire, Erhart & Col, $900,000; J.W. Wilshire, $48,000 and so on through a long list.”

Keen readers of the Republic likely recognized J.R. Wilshire as Joe Wilshire, the same Cincinnatian AP had observed meeting a man with stuffed pockets at a Chicago street corner.

Harper first denied any knowledge of the memorandums “and went so far as to say that he did not believe that (the corner on the market) was managed at all in Cincinnati, but was conducted from California and Cleveland.”

Whether the mention of California led readers to recall the attempted suicide of “dashing stock and provision speculator” Walter Wade is not mentioned. But the connection seems plausible, and there is historical evidence that Californians were involved.

In its extra editions at 9:30 a.m. and 4 p.m. Friday, June 24, the Republic broke the dreaded news that Whiteley, Fassler & Kelly was bankrupt and in receivership.

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In an apparent effort to ward off panic, Whiteley downplayed the importance of the move. So did Asa Bushnell, the partner in Warder, Bushnell and Glessner, who had just completed his mansion on East High Street.

“There is nothing in this Champion matter to excite apprehension,” Bushnell said. “It is simply a financing detail.”

But the Republic then quoted what it described as a “shrewd citizen who has made a thorough study of the situation and is excellently qualified to know what he is talking about” - what we today would call “a well-placed anonymous source.”

The citizen said that “Whitely had once been assisted by Harper and that he had since helped Harper out of a box in 1884 by means of an accommodation paper. I know that Whiteley was not in Harper’s Chicago wheat deal and that he know nothing of Harper’s being in it until he read of it in the Cincinnati papers.”

The source added “seeing that a crash in his financial affairs was imminent, Harper, without Whiteley’s knowledge or consent, renewed and raised money on this paper, which was simply as good as gold in the financial markets.” The source added that “Whiteley’s dealings were with E.L. Harper & Co. - not with the Fidelity Bank.”

To Harper’s creditors it made no difference. Built for $1.2 million, the East Street Shops were auctioned off for $200,000. Workers at the plant lost their jobs; the Fidelity Bank failed; and E.L. Harper went to prison.

As for the Reaper King?

He lost almost everything due to the wheat clique’s speculation in the market for the very grain he had designed his machines to harvest.

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