Black Thursday 1929: The Man Who Bid $205 — and Ended Up in Sing Sing

On Black Thursday, October 24, 1929, Richard Whitney walked onto the floor of the New York Stock Exchange and bid $205 a share for U.S. Steel. Less than nine years later, the same Exchange suspended his firm for insolvency, and he was on a train to Sing Sing. This is the story of who knew, and when. Whitney was Groton, Harvard and the Porcellian Club, the broker for J. P. Morgan & Co. on the floor and five times president of the Exchange, the man who told Washington that Wall Street could police itself. Behind that name were failing side bets on applejack and Florida peat, a circle of loans from banks, friends, Morgan partners and his own brother, and bonds taken from the New York Yacht Club, from his customers and from the Exchange's Gratuity Fund, a fund for the families of dead members. We follow the money around that circle, the brother who quietly put the fund back together in November 1937, the questionnaire that finally exposed him, and who paid in the end. CHAPTERS 00:00 Black Thursday 01:53 The White Knight 06:53 A Perfect Institution 12:08 The Side Bets 15:59 The Gratuity Fund 18:53 The Questionnaire 23:09 The Train 27:07 Who Paid THE TAPE • October 24, 1929: almost 13 million shares traded, a record; Whitney bids $205 for Steel • October 28 and 29, 1929: the Dow falls nearly 13 percent, then nearly 12 percent more • 1930–1935: Whitney is president of the New York Stock Exchange • November 1937: about $900,000 in Gratuity Fund bonds and cash restored with money borrowed from Thomas Lamont • March 8, 1938: Richard Whitney & Co. suspended for insolvency; April 11, 1938: sentenced to 5 to 10 years • The S.E.C. count: 111 loans in his last four months, $27,361,500 borrowed, $6,471,000 never repaid (roughly $150 million today, by the BLS consumer price index) SOURCES • Securities and Exchange Commission, report on the Whitney investigation (1938) and records collected by the SEC Historical Society • TIME (1938), testimony of Richard Whitney before the SEC • The Harvard Crimson, obituary of Richard Whitney (December 1974); The New York Times (1938, 1974), as cited • Baird v. Franklin, 141 F.2d 238 (2d Cir. 1944); certiorari denied, 323 U.S. 737 (1944) • Federal Reserve History, "Stock Market Crash of 1929"; Federal Reserve Bank of New York on William McChesney Martin • HistoryNet, History News Network (Malcolm MacKay, "Impeccable Connections"), Newsweek, HISTORY • William Manchester, "The Glory and the Dream"; Louis Auchincloss, "The Embezzler" (1965) PHOTO & VIDEO CREDITS Public domain: Library of Congress (Harris & Ewing, Bain News Service, National Photo Company, Irving Underhill); New York Public Library (Berenice Abbott); U.S. National Archives; Bibliothèque nationale de France (Agence Rol); Nationaal Archief / Spaarnestad; Paul Strand; Dorothea Lange; Joseph Pennell (CC0, National Gallery of Art); stock certificates (CC0 and public domain). Archival film (public domain, Prelinger Archives via Internet Archive): "Arteries of New York City" (Encyclopaedia Britannica Films, 1941); "What Is Money?" (Coronet Instructional Films, 1947). • "Elk River State Bank, 1929 - Stock Certificate" — Steve Shook, CC BY 2.0, via Wikimedia Commons • "J. P. Morgan & Company Building 23 Wall Street" — Beyond My Ken, CC BY-SA 4.0, via Wikimedia Commons • "23 Wall St" — Matthew Bisanz, CC BY-SA 3.0, via Wikimedia Commons • "New York City, 1 Aug 08" — Jazz Guy from New Jersey, CC BY 2.0, via Wikimedia Commons • "New York Stock Exchange" — Andrew Napier, CC BY 2.0, via Wikimedia Commons • "Former Far Hills depot - September 2020" — Mitchazenia, CC BY-SA 4.0, via Wikimedia Commons • "Relief over the Stock Exchange" — Ben+Sam, CC BY-SA 2.0, via Wikimedia Commons • Stock footage from Pexels: MART PRODUCTION, David Pickup, Ambam Gorilla, Mikhail Nilov, Curtis Adams, K, Chris The Island, emirkhan bal, Tima Miroshnichenko, RDNE Stock project, Reiner Pfesdorf, KoolShooters, Stefanie Jockschat, Kaboompics, Attila Pergel, Ron Lach, cottonbro studio, Los Muertos Crew, Salih Sezgen, David Roberts, Artem Podrez, Sascha Weber Images were cropped, resized, color graded and animated; adapted CC BY-SA images remain under the same license. No endorsement by the authors is implied. Full credits are at the end of the video. Music: original score. Thumbnail: archival Harris & Ewing photograph (1937), digitally colorized. Some scenes are AI-generated illustrations of places and objects (a trading floor seen from behind, a ticker machine, a bank vault, an empty boardroom, a courtroom, a prison baseball field and others). They show no real people's faces and are used only where no archival photograph exists. If your brother came to you, the way Richard came to George, with the family name on the line and a million dollars missing, what would you have done? Paid, and kept quiet? Or picked up the phone? #RichardWhitney #BlackThursday #1929Crash #WallStreet #FinancialHistory