Richard Whitney
Richard Whitney (born August 1, 1888 in Boston , Massachusetts , † December 5, 1974 in Far Hills , New Jersey ) was an American banker, investment advisor, broker and president of the New York Stock Exchange in the early 1930s .
Early years and advancement
Whitney was born the son of the banker George Whitney on August 1, 1888 in Boston. His ancestors were immigrants who reached the colony at the time around 1630. After studying at Groton and Harvard , he moved to New York in 1910 . He founded the brokerage firm Richard Whitney & Co. there and became a member of the New York Stock Exchange two years later. He was soon the main broker for JP Morgan & Co., of which his brother George later became vice president. During the First World War he headed the Food Administration almost voluntarily (for the symbolic payment of one dollar per year) , the chairman of which was later US President Herbert Hoover . In 1916 he married the young widow Gertrude Sheldon Sands; from this marriage there were three children. Whitney took over her father's investment business, Cummings and Markwald, and changed his name to Richard Whitney & Co. Three years later he was elected to the board of directors of the New York Stock Exchange.
Stock market crisis of 1929
Meanwhile Vice President of the New York Stock Exchange, Whitney tried at the height of the panic on October 24, 1929 , to stop the wave of sales by means of support purchases by ordering a number of securities well above their market price; his appearance on the trading floor and his order for tens of thousands of shares in US Steel for 40 points above the market price made Whitney the hero of the stock market. All of his expenses went down as the largest transaction in history at an estimated $ 20 million in a single afternoon. It applied particularly to the top-quality stocks, the price of which was to be stabilized. Since sales reports were received from all over the country, the success was limited and could not prevent the subsequent global economic crisis.
The following years
In the crisis year of 1930, Whitney became President of the New York Stock Exchange and held this office for five years. During this time he was the spokesman for the so-called Old Guard, a loose association of wealthy people, which came under the fire of reform-willing forces in the following period, especially from 1933 through the " New Deal " under Franklin D. Roosevelt's presidency . So it happened that between 1932 and 1935 he had to testify several times before a committee of inquiry set up by Congress.
As the reform forces grew stronger, Whitney decided in 1935 not to run again for the presidency of the stock exchange.
Whitney's sudden fall and his life after
At the same time he was involved in speculative transactions, for which he borrowed large sums from friends and acquaintances, whereby his connections to JP Morgan & Co. through his brother served him as a kind of security. He is said to have borrowed around $ 30 million from friends, family and from the cash holdings of his own company to keep his company going. He also became increasingly entangled in illegal practices.
Eventually his books were reviewed and in March 1938 his empire collapsed. An investigation revealed the full extent of his mismanagement. When he was declared bankrupt, he was about $ 6.5 million in debt.
He was then charged with misuse of foreign funds, pleaded guilty and was sentenced to five to ten years in prison, of which he served three years and four months in Sing Sing . After his release, he retired from the public to a family estate in Barnstable, Massachusetts. His wife stood by him throughout the difficult time and sold almost the entire fortune of the couple. His brother is said to have taken over his debts. Whitney died on December 5, 1974 in Short Hills, New Jersey.
The effects of Whitney's actions
Richard Whitney's practices shocked the business community, and when President Roosevelt learned of the embezzlement, he was said to have been on the verge of collapse. However, they provided the impetus for fundamental reforms of the financial markets.
media
In 1966, the director August Everding shot a documentary about Whitney with the title Black Friday with Curd Jürgens in the lead role. Horst Tappert took on the role of speaker .
Individual evidence
Web links
| personal data | |
|---|---|
| SURNAME | Whitney, Richard |
| BRIEF DESCRIPTION | American banker, investment advisor, and broker |
| DATE OF BIRTH | August 1, 1888 |
| PLACE OF BIRTH | Boston , Massachusetts |
| DATE OF DEATH | 5th December 1974 |
| Place of death | Far Hills , New Jersey |