Wheels within Wheels Read online

  “Some of the boys sound very worried, boss.”

  Bergheim smiled: sardonically. Sure; they’d be worried. The half of them would have been cleaned right out.

  “You needn’t stay up, Peter. I can get myself anything I want.”

  “Very good, boss.”

  But the darkie did not go. He stood, with his hands clasped in front of his white coat, the long dark fingers intertwined and twitching.

  “It’s been a bad day, boss.”

  “Very.”

  “Ah’ve lorsted all mah money.”

  “You’re not alone, Peter.”

  “All ah’ve saved in the twenty years ah’ve worked for yo’. Gone in a few hours.”

  For the first time in their long association Bergheim laid his hand upon his servant’s elbow.

  “Don’t you worry, Peter. No one who’s been my friend as long as you have need have any fear about the future.”

  And with a pat on the negro’s arm he passed on into his bedroom.

  Of all the high drama and tragedy that that day had held for him, this little incident alone had touched him personally.

  As he changed out of his hot, down-town clothes into pyjamas and a dressing-gown he reflected that an old bachelor had no real friends except his servants. There was a succession of casual contacts, pleasant and unpleasant, brief or long, but when the fifties were past, when one was parentless, when one was childless, one had need of some one who had travelled down the same road with one, to whom one was linked by a chain of events trivial in themselves, but in their sum important because they had been shared and were that chain’s links. A servant unobtrusively became that person. He was the silent spectator of your successes and disappointments. Somehow or other he contrived to be there, for the exchange of a few sentences, at all the climaxes and turning-points of your life. He was the one person to whom you could say of nearly every episode: “Do you remember?” As you grew old that counted far more than anything. He was not going to let old Peter worry over Wall Street’s troubles.

  From his bedroom window he could see the incredible fairyland that was up-town New York. The headlights of innumerable cars were sweeping across the broad expanse of Central Park. Against the majestic turreted backcloth of fifty-ninth street, the sky signs of Fifth Avenue were flashing. There was the same blaze of lights, the same roar of traffic, the same electric vitality. It looked just as it had looked yesterday, as it had looked two months ago in the glittering pomp of the new high levels. There would be nothing to warn the traveller from abroad that a typhoon had struck the city: that in every restaurant, every apartment, every speakeasy men and women were talking in dramatic, agitated tones of the day’s happenings, of the sudden wave of selling that had cracked the market; selling that was to start with neither short nor panic, but forced; because innumerable brokers, like himself, not having received that morning the collateral they had demanded, had chucked large blocks of shares upon the market.

  They would be talking in those innumerable conversations of the panic that had set in; of the impossibility of discovering what was happening, with the ticker an hour to an hour and a half behind the floor; of giving orders and not knowing what had happened to them; of the desperate attempt of the bankers in the last hour and a half to stay the rot. Of all that they would be talking. But to Bergheim, who had been an actor on that hectic day, in the same way that the personal tragedy of the day had been explained chiefly through the picture of Peter, his eyes dazed, his fingers plucking nervously: dark, writhing things against the white coat; so was the panic of the day exemplified and typified by one incident.

  A woman had jumped from the twenty-third story of the Equitable Buildings. She was plump and tall. The impact of the fall had been so great that the flattened flesh had burst the seams of her frock in two discoloured weals. Her death was instantaneous. She had lain where she had fallen. So great was the surrounding panic that she had been allowed to lie there for an hour. There was too much else to be bothered over. October the twenty-fourth was typified for him by that gruesome, untended spectacle upon the sidewalk.

  • • • • •

  Of how much this day was to mark the close and in its turn the start, Bergheim could not more than guess. He suspected, though, there would be a heavy reaping. It was not so much that a great number of rash investors had lost a great deal of money as that the system of credit on which post-war American prosperity had been based, had crumbled. Buying stock on margin was the symbol of that mortgaging of the future. Because the levels of the stock market stood high, the artisan could buy radios, automobiles and furniture on instalment: because of their purchases the forces of production could be multiplied. The worker who was paid high wages could in his turn buy more automobiles on instalment. It was a circle built on the system of a mortgaged future. Up to a point it was a sound system. If you couldn’t trust the future, you were better in the grave. And if Americans, in view of their past, couldn’t trust the future, who could? Only they had gone too far. They had not only mortgaged the future; they had mortgaged the hereafter. The levels of the stock market had given Americans an entirely false view of their immediate potentialities. They had undertaken obligations that they could only fulfil if the bull market continued. Their acceptance of those obligations had inspired an optimism in producers that in turn was dependent on the capacities of the consumer to fulfil those obligations. The consumer would not now be able to. Because the system of buying stocks on margin had collapsed, so would the system of buying radios on instalment. The radios would be returned to the producers, the expensive apartments emptied, the interests on the mortgages would not be met; the producers would have to cut down production. They would have to lower wages or else discharge employees. Either alternative would cut down the purchasing power of the community: would again demand further reductions in staffs and wages. Everything was interknit. The same system that had sent prosperity to dizzy pinnacles would plunge depression to an equally deep abyss.

  Standing there at his bedroom window he wondered at the nature of the fate that overshadowed the city in which he had been born; that he had never left; that he had seen grow round him. Hardly a stone remained of the city that he had known in childhood. And yet at heart it had not altered. There was the same vitality, the same noise, the same hurry, the same searching for short cuts, the same flamboyance, the same reverence for success, the same intolerance of pomposity, the same need for a good time, the same spirit of play, the same largeness and generosity of heart. There were those who called New York a cruel and a heartless city. He had not found it so; though he, of all people, had the excuse for thinking it so. As a Jew he was if not actually an outcast, at least suspect. In no other city in the world was the feeling against the Jew more strong, was the Jew more isolated among the people of his own race: more, on the whole, resented. That was of course true. But New York had let him be’ himself, had allowed him to lead his own life; as it had let the Italians, the Lithuanians, the Greeks, the Serbs, the Swedes, the Croats, make their homes and enjoy their liberty. Every city understood liberty in a different way. New York’s way was to leave people alone to make what they chose of life. And if it seemed that New York was forgetful of its friends, that it was a city that welcomed warmly and said good-bye warmly, but was neglectful of what it had temporarily cherished, New York was a port; it made its gestures of “Hail” and “Farewell” to the ships as they came and as they went, but it was very busy, it had no time to be friendly to more than that which it encountered; it had not time to bother about what lay outside its way. Bergheim had travelled little. He had heard talk of the other four or five great cities of the world: Paris, London, Berlin, Constantinople, but he had felt no great wish to exchange New York for them.

  He wondered as he stood there how New York would weather the storm that was beating round her. For all her rock-based strength and her tall towers she seemed to him more vulnerable than those European cities that had absorbed disaster into their
systems. Those that survived an epidemic were inoculated. In the same way that the Black Death had become the childish complaint of measles. New York had known few reverses: at least, not this New York. New York had changed so fast, had grown so fast, had developed the capacity to forget the past and live in the future; it could not remember the dark hours of previous depressions. With the eye of vision he saw the landmarks of the dark days that would precede the inevitable return to prosperity: the bread lines, the apple sellers, the hunger marchers. He shrugged his shoulders. He would have a hard day to-morrow. It would not do to look beyond the morrow. It did not do to brood on what was distant. His mind, as was its wont, tabulated the various matters that rising out of that day’s events would need reconsideration next morning. Among many other weightier matters was, he reflected towards the end of his deliberations, the oil well in Santa Marta. Several of the main shareholders would, very certainly, be unable to continue their guarantees.

  • • • • •

  Early on the following afternoon, a telephone call brought Roy Bauer round to Bergheim’s office. He was angry, blustering, frightened. To hide his fear he exaggerated his customary truculence.

  “Now what’s all this nonsense? “he began. “Telling me my position’s critical; as though I were the bellhop in some down-town speakeasy! You know that I’m all right.”

  “I know you were all right.”

  “What am I to take that to mean?”

  “A good many men were all right three months ago. You’re in good company.”

  The little man spoke calmly, unemotionally, with complete indifference. It was hard to get any satisfaction out of being angry with him.

  “Why didn’t you ask me for more collateral?”

  “I hadn’t time.”

  “What about all that General Motor stock?”

  “Your expenses in the oil field?”

  “General Motor shares are dropping.”

  “They certainly are.”

  “You’ll have to sell a large block to meet that last consignment.”

  “I did.”

  “Have I much left?”

  “You’ll receive a statement at the end of the month. We shall be having to ask you for some more collateral.”

  “That oil mine’s eating the food all right.”

  “I warned you it was a gamble.”

  “I’m not sure I shouldn’t be glad to be out of that gamble.”

  “You’ve your chance now.”

  “What do you mean?”

  “It’s what I wanted to speak to you about. A good number of the people who were in with you have been wiped out.”

  “Who?”

  “Franck, Guggensteim, Kendall….”

  “Kendall?”

  “He’s back where he began.”

  Kendall! Bauer could hardly believe it. Two days ago there wasn’t a man whose position he would have envied more whole-heartedly. Kendall wiped out. And those other two as well. He was lucky, he supposed, to be still afloat: to have had enough sound stock to cover the retreat.

  “Say, what’s the next move?” he asked.

  “Do you want to take over their shares and responsibilities?”

  “What’s the alternative?”

  “Trying to persuade Newton to take them over.”

  “Trying?”

  “I’m not certain that at such a time he would be willing to add to his obligations.”

  “What?”

  A startled look had come into Bauer’s face at the suggestion that he should sell his share: a perplexed and outraged one at the suggestion that his chief partner would not want to buy. He could not believe that the well on whose possession he had so prided himself was valueless.

  “You don’t mean to say that he’s lost faith in the oil well?”

  “He may be feeling as you are feeling: that the risk is too great: that he would be wise to get out while he can: now, without too great a loss.”

  “Then in that case….”

  “The syndicate will go into voluntary liquidation.”

  “All our money wasted?”

  “Yes.”

  Bauer paused thoughtfully.

  “If he is likely to think that later, don’t you think I should be wise to get out now, when I can be bought out: or at least try to be bought out?”

  “You can suggest it to him.”

  “Do you think I should be wise?”

  Bergheim pouted.

  “It is a gamble. From first to last I told you that it was a gamble. Everything connected with this speculation is a gamble. You may very likely cut your losses and be bought out. At the same time by making this offer, you may suggest to Frank Newton that the oil well is costing more than it is worth. We are all creatures of habit. Having once decided on a course of action, we continue on it without further thought, till suddenly something happens to make us reconsider our position. Then suddenly we take action.

  “That may very well happen now in Newton’s case. Since the day he decided to continue drilling, he has probably not thought seriously about the oil well. He has had other more immediate interests. It has been in the background. Your offer will force it again into the foreground. He will take stock of his position. He will say to himself, ‘This American has got cold feet. Why?’ He will put to himself all the arguments there are against his continuing this enterprise. It may be that those arguments will seem as strong to him as they do to you. In that case, you will get no money out of the speculation, though equally you will stop losing it; drilling on the well may cease at the very instant when oil is on the point of being struck.”

  “What do you recommend me to do, then?”

  Bergheim pursed his lips. He never recommended people to do anything. He stated the facts as he saw them; and left other people to draw such conclusions as they might from them.

  “One thing you must do is to ignore completely the amount of money that you have already spent. Since oil has not been struck, that money must be regarded as lost. You must start looking forward from where you are now. You must leave the past out of consideration. You have to set the money you will still have to find if you are to continue drilling against the money you will make if you strike oil: against the possibility of being bought out by Newton and of having Newton call off the deal altogether. There are the alternatives that you have to choose from.”

  Bauer listened, his anger evaporated, his self-confidence and self-righteousness gone with it. He hated the calm of the little Jew. He was used to heartiness; to optimism; to vague, high-sounding declarations about the future. He did not like this cool weighing out of facts. During the last twenty-four hours the temper of his world had changed. Through the window of Bergheim’s office he could see the tall palisades of the down-town skyscrapers. Like strange plants they had flowered overnight. A year ago their swift flowering had seemed to symbolize the swift fortunes that in the New World lay to hand for the adventurous. Now the very suddenness of their growth was frightening. The flowers that had sprung up so quickly might be withered before nightfall. Would not his own fortunes crash with those of the world that had been their background? Just as he had been unable two months back to compute his winnings, now he was unable to compute his losses. He felt rudderless, alone, chilled, as a man coming too quickly from a Turkish bath into the night air.

  “I can’t risk any more,” he said. “Ask them if they’ll buy me out.”

  “Very good. I’ll cable Newton.”

  • • • • •

  The cablegram that Frank Newton read was not perhaps such a one as Bauer would have cared to send; or would have held to be an accurate diagnosis of the situation.

  “Owing to stock market break several members French Caribbean Syndicate anxious relinquish shares. How much are you prepared take over?”

  It would have seemed an understatement in the first place; in the second, an inquiry rather than a demand.

  It was as an inquiry rather than as a demand that Frank Newton in t
he large book-lined study at Appleton read the cable. The magnitude of the Wall Street panic had yet to cross the Atlantic. England was sufficiently concerned with its own losses in the Hatry failure. The losses of Westinghouse and Allied Dyes were the beating of a distant drum. There had been a headlined column in The Times, but there had been reassuring statements from American financiers that the worst was over. A pool of bankers, it was said, had the situation well in hand. Announcements from the White House had asserted that the position was fundamentally sound.

  Frank Newton had been ready to accept those assurances. Like other Englishmen he had accepted American prosperity at its face value. He had been long accustomed to the sight of Americans spending gold as though it were silver; as though shillings and not pennies were the monetary unit. Since America was the creditor nation to the world such conditions of prosperity as might exist in Europe would be found in a correspondingly heightened form on the other side of the Atlantic. He could not believe that American prosperity was endangered.

  He did know, however, that American optimism had its obverse side: that the brave talk was balanced by a readiness to crumble: that as every strength had a corresponding weakness the self-confidence of the American was far more vulnerable than the diffidence of the European. The American exaggerated the extent both of his success and his failure. He tended to lose his head. Knowing this, Frank Newton was not surprised at Bergheim’s telegram. He could imagine how people used to easily-won triumphs, would at the first reverse withdraw behind safe ramparts. The defection of a large section of the Syndicate did not impair his belief in the wisdom of his investment. He did not on their account feel any wish to extricate himself from his responsibilities. The problem as far as he was concerned was the extent to which he was justified in undertaking fresh responsibilities.

  For such responsibilities would involve the acquisition, as Appleton had done, of ready capital. And his assets were uncomfortably frozen. He could only realize them by depreciating their capital value. They paid dividends; by selling them below par and reinvesting, he ran the danger of reducing his income. His War Loan stock held for emergencies was his only immediately negotiable security. He had meant to keep that for an emergency. He did not want to realize it. At the same time, he was reluctant to let slip all the money he had already sunk in the West Indies. He suspected that if he did not take over a considerable share of its responsibilities, the Syndicate would be liquidated. He was anxious to avoid that.