Hard Times (15 page)

In ’32 and ’33, there was no securities business to speak of. We played
a lot of bridge in the afternoons on LaSalle Street. There was nobody to call or see. It was so quiet, you could hear a certificate drop. (Laughs.) Nobody was making a living. A lot of them managed to eke out $40, $60 a week, but mostly we played bridge. (Laughs.)

I found a certain obtuseness about what’s going on in the country. Even after it happened. Of course, at the beginning of the New Deal, the capitalists embraced Franklin Roosevelt as a real savior of our system. The Chicago
Tribune
wrote laudatory articles about him. Editorials. As soon as things got a little better, the honeymoon was over. You know all those old stories about guys getting on the train at Lake Forest: they were always looking for one headline every morning, that black headline about F.D.R. These people….

It took this guy with the long cigarette holder to do some planning about basic things—like the SEC and the WPA and even the lousy Blue Eagle. It put a new spirit in the country.

The Bank Holiday of 1933 brought a certain kind of joyous, devil-may-care mood. People were just gettin’ along somehow. It was based on the theory: Good grief, it couldn’t get much worse. They bartered things for things.

The Irish Players were in Chicago, and everybody took potatoes to get in. People were taking vegetables to the box office. And they had big audiences.

I’m not trying to detract from the fact that there was wholesale misery in the Depression, ’cause you knew there were people living under the Michigan Avenue Bridge. Gentlemen in old $200 suits were selling apples. There was plenty of misery. I never want to see another… .

I don’t find that people remember the Depression or think about it. I don’t find it coming up in conversations. I also discover that a great many people, even professors, who might have gotten $300 a month during the Depression—some of them are worth a hundred, a hundred fifty thousand bucks today. You’ve never seen so much money around in history as there is today. Never. It’s happened in the last twenty-three years … the development of industry and the creation of equities in business.

Another remarkable thing about the Depression—it never resulted in revolution. I remember that out in Iowa some place, there was a fellow named Reno,
³⁸
who led a small following. There were some trucks turned over, and sheriffs weren’t allowed to foreclose. But when you consider what was going on in the country—the whole country was orderly: they just sat there and took it. In retrospect, it’s amazing, just amazing. Either they were in shock, or they thought something would happen to turn it around… . My wife has often discussed this with me. She thinks it’s astonishing, the lack of violent protest, especially in 1932 and 1933.

JUST BEFORE the Crash my father, who was a barber, bought a building. We pinched. We didn’t lose the building. He was a frugal man. I remember how he used to scrounge and scrape to make his mortgage payments. He borrowed money from a loan company very frequently. Oh, the tension in the house, when Pa used to scramble around trying to get enough money to pay that installment loan. That was the one degrading thing I remember.

It was a well-known loan company. I remember it as so dingy. I’m sure it wasn’t. It was just the way I felt: there was something not quite right about it. I didn’t feel shame. I felt resentment of conditions over which we had no control.

The worst thing I have to do every month is to pay my mortgage. I hate to think of all that interest being paid. If I had the money, I’d pay it all off. I just loathe it.

 

MILLIONAIRES would come to me for treatment of anxiety attacks. In 1933, one of them said to me, “I’m here for treatment because I have lost all my money. All I have left is one house on Long Island which is worth $750,000. I don’t know what I’d get for it if I tried to sell it.” He was a very aristocratic looking man. “I’ve always had a feeling of guilt about the money I’ve made.”

I asked him, “Why do you feel guilty about it?” He said he was a floor trader and when he saw the market begin to fall, he would give it a big shove by selling short. At the end of the day, he had made $50—$75,000. This went on for a long time. He said, “I had always felt as if I had taken this money out of the mouths of orphans and widows.”

He felt guilty after the walls caved in. He began to feel what it was like not to have any money. To give you an idea of the importance of this man: he was in a secret meeting at the J. P. Morgan bank, when they were trying to stop the decline. He had an appointment at five o’clock, and he
said, “I won’t be here today. But when I see you later, I’ll have an important message for you.”

If I had bought General Motors and Chrysler where it was in March, 1933, I could have been a multi-millionaire on the investment of $10,000. But that wasn’t his message. He said, “We have decided to close the Bank of the United States because the President was truculent and insisted upon an enormously inflated price for his stock.” This was a very small bank in New York. They decided to let him go to the wall. The bank failed.

This man told me to go to the bank and take all my money and get gold notes. They were yellowbacks that said on the back: Redeemable in demand at the U.S. Treasury for gold in bars. I got $10,000 in gold. I said, “What the hell am I going to do with this?” It was heavy as hell. In gold bullion. I put it in a safety deposit box. Two days later, I had to take it out because the President declared the possession of gold to be illegal. I gave it back to the bank, and they credited me with $10,000.

I learned about the crack in our economy long before the stock market crash of ’29. I had a patient who was the biggest kitchen utensil distributor in America. He had a huge plant. He said: suddenly, without notice, his orders just stopped. May and June, 1929.

All of us believed a new era in finance dawned. How long was I in the stock market? From ’26 to ’29. I had doubled my money. I remember some of the stocks I bought. I bought Electric Bond and Share, for example. I bought it at $100 a share and sold it at $465.

That was the only way you could make any real money. Income was piddling. Physicians were the greatest amateur financiers in the world. The way in which doctors, some of my friends, became interested was they had patients in high finance. They told them which stocks to buy. They were heading for a fall.

I began to invest in 1926. At the time I was working for Veterans Administration, and I think every doctor there had his finger in some kind of stocks. Some did better than others. I was too timid. Until a couple of years later, when I got a tip to buy Montgomery Ward, and within ten days I’d made $1,000.

In May of 1929, I personally pulled out of the market. I took my money out of the house I was dealing with and entrusted it to a man who was the backer of one of the wealthiest men in the country. Thinking he was infallible. He began buying stocks. He bought me Johns-Manville, for example. It was selling at $112. He bought a hundred shares at a bargain, 105. I sold it at 50.

This man embezzled stocks in the spring of 1929, something like $3 million worth. He was in very deep trouble. He died of a coronary. There was no prosecution. He was a pawn. The man whose manager he was was worth about a hundred million. He was not injured in the Crash. He made vast fortunes in dealing with devaluating currencies in Europe. He passed
tips along to his friends. A good many of them made $6—$8 million. $6 million is a lot of money. They were cashing in on the decline in European currency.

 

 

Nothing much. You wouldn’t know a Depression was going on. Except that people were complaining they didn’t have any jobs. You could get the most wonderful kind of help for a pittance. People would work for next to nothing. That’s when people were peddling apples and bread lines were forming all over the city. But on the whole—don’t forget the highest unemployment was less than twenty percent.

 

 

Not very much. They paid fairly reasonable fees. I just came across a bankbook that I had between 1931 and 1934, and, by God, I was in those days making $2,000 a month, which was a hell of a lot of money. Then in 1934, 1935, 1936, they began coming in droves, when things began to ease up. People were looking for help. All middle class. Money loosened up. At the outbreak of the war, all psychiatrists in New York were just simply drowned with work. I saw my first patient at seven in the morning and I worked till nine at night.

 

 

 

The lower classes? No. Let’s take the lower middle class, a contractor. He built me a ten-room stone house for $8,500. I would pay him five cents a square foot for knotty pine that would cost you $1.50 today. Same thing. No laborer that worked in my house got more than $5 a day. I asked the contractor what he got out of it. He said, “I ate for six months.” It was catch as catch can. Undersell yourself, do good work, on the hope that you would be recommended to somebody else.

In those days everybody accepted his role, responsibility for his own fate. Everybody, more or less, blamed himself for his delinquency or lack of talent or bad luck. There was an acceptance that it was your own fault, your own indolence, your lack of ability. You took it and kept quiet.

A kind of shame about your own personal failure. I was wondering what the hell it was all about. I wasn’t suffering.

An outstanding feature of the Depression was that there were very few disturbances. People mass-marching, there was some. People marched in
Washington and Hoover promised everything was going to be all right. People hoped and people were bewildered.

Big business in 1930 and later in ’32 came hat in hand, begging Roosevelt. They have never gotten over their humiliation, and they have never forgiven him for having the wits to do something about it. Priming the pump.

Now people think it’s coming to them. The whole ethos has changed. There is a great deal more hatred and free-floating aggression all over the country. We have reached unprecedented prosperity. Everybody says: “Why not
me
?” The affluent society has made itself known to people … how the better half lives. It’s put on television, you can see it. And everybody says, “Who the hell are they? What’s the matter with me? My skin is black, so what?” You don’t accept responsibility for your own fate. It’s the other fellow who’s to blame. It’s terrible. It could tear our country apart.

 

 

It would be an inchoate affair. It wouldn’t be organized.

Today nobody is permitted to starve. Now they think it’s coming to them. As a matter of fact, it was the government that brought this idea to the people, in the Thirties. The people didn’t ask the government. They ask the question they can’t answer themselves: Why am I the goat? Why me? They want pie in the sky… .

 

ALL I KNOW about the Depression is what I studied about it. People suffered and had to carry out food stamps. My parents mentioned it vaguely. I could get no information from them… .

THE NEGRO was born in depression. It didn’t mean too much to him, The Great American Depression, as you call it. There was no such thing. The best he could be is a janitor or a porter or shoeshine boy. It only became official when it hit the white man. If you can tell me the difference between the depression today and the Depression of 1932 for a black man, I’d like to know it. Now, it’s worse, because of the prices. Know the rents they’re payin’ out here? I hate to tell ya.

 

 

We had one big advantage. Our wives, they could go to the store and get a bag of beans or a sack of flour and a piece of fat meat, and they could cook this. And we could eat it. Steak? A steak would kick in my stomach like a mule in a tin stable. Now you take the white fella, he
couldn’t do this. His wife would tell him: Look, if you can’t do any better than this, I’m gonna leave you. I seen it happen. He couldn’t stand bringing home beans instead of steak and capon. And he couldn’t stand the idea of going on relief like a Negro.

You take a fella had a job paying him $60, and here I am making $25. If I go home taking beans to me wife, we’ll eat it. It isn’t exactly what we want, but we’ll eat it. The white man that’s been making big money, he’s taking beans home, his wife’ll say: Get out. (Laughs.)

Why did these big wheels kill themselves? They weren’t able to live up to the standards they were accustomed to, and they got ashamed in front of their women. You see, you can tell anybody a lie, and he’ll agree with you. But you start layin’ down the facts of real life, he won’t accept it. The American white man has been superior so long, he can’t figure out why he should come down.

I remember a friend of mine, he didn’t know he was a Negro. I mean he acted like he never knew it. He got tied downtown with some stock. He blew about twenty thousand. He came home and drank a bottle of poison. A bottle of iodine or something like that. It was a rarity to hear a Negro killing himself over a financial situation. He might have killed himself over some woman. Or getting in a fight. But when it came to the financial end of it, there were so few who had anything. (Laughs.)