Northern Pacific Railway Company check with tax imprint. Check written for 60 cents!
During the years of use of the 1898 series tax stamps occurred one of the first crashes on Wall Street. The crash centered on the trading of the stock of Northern Pacific. The A. A. Housman post from yesterday hints at the role of Arthur Housman in helping to stabilize the market after it had begun to crash.
The Northern Pacific was a railroad built to run from the midwestern United States and the twin cities of Minneapolis and St. Paul to the Pacific coast, cutting across the northern tier of US states. Despite the great distance from the financial center in New York City, the stock of the Northern Pacific would have a major impact on the New York Stock Echange's operations in 1901.
Gilded Age barons fought for control of the Northern Pacific Railway. The main characters included James J. Hill, builder of the Great Northern Railway, J.P. Morgan, the greatest financier of the time and arguably of any age, Edward H. Harriman, the Chairman of the Union Pacific, William Rockefeller, the brother of John Rockefeller of Standard Oil, and Jacob Schiff, a leading New York financier.
Harriman used his holdings of Union Pacific to speculate in and attempt to monopolize rail traffic in and out of Chicago. James J. Hill, the St. Paul, Minnesota-based head of the Great Northern Railway fought Harriman to prevent his control. Hill had J.P. Morgan as an ally, while Harriman had resources from Standard Oil via William Rockefeller.
Attempts to buy up Northern Pacific stock on the NYSE started a panic on May 17. Investors and brokers began to dump stocks and prices began to fall dramatically, especially in railroad issues like the Chicago, Burlington & Quincy, the Missouri Pacific, and the Union Pacific. Arthur Housman showed up on the floor and began buying for J.P. Morgan, helping to stabilize the market.
In the end Harriman and Hill decided to join forces and created a holding company to control the NoPac, Great Northern, and the Burlington. The holding company was broken up through the application of the Sherman Antitrust Act of 1890.
Frank Sente discussed the 1901 crash and the precursor trading in the Chicago, Burlington & Quincy Railroad in this post from April 23, 2011.
Meanwhile, many of the corporate players in this stock market meltdown were users of 1898 series revenue stamps. Let's take a look:
Great Northern Railway:
Chicago Burlington & Quincy Railroad:
J. P. Morgan: