Reginald stopped, letting the people consider that. Frank guessed he was now ready to make his point.
And after a long pause, he did so. “I don’t need to tell you what happened next. It’s happening all over America. Farmers default on their loans. The bankers have no choice but to foreclose on their mortgages and seize their property as the farmers, desperate and destitute, pack up their families and head for the cities, where factories are clamoring for more workers. Here’s another shocking statistic.” He was looking at his paper again. “By 1930, just a year from now, the government is estimating that in this decade we call the ‘Roaring Twenties,’ more than six million people will have abandoned their farms.”
Frank was aghast. Six million!
“Many of those have no choice,” Reginald continued. “They don’t own the land anymore. The bankers do. But even the farmers who were frugal and refused to go into debt have a problem. They can’t sell their food either, and so they are forced to head for the cities too. So they put up their farms for sale. Slight problem: all the bankers are frantically trying to sell the land they’ve foreclosed on.” He paused, looking grim now. “So you tell me. What’s happening to all that farmland out there?”
Hands went up everywhere, but Claude Rutherford stood up and leaned forward, hands on the table. “The prices have dropped precipitously, because no one has the money to purchase the land. It is a massive buyer’s market out there right now.”
Celeste leaned closer and looked at Frank. “Is that right?” she whispered. “They just walk away?”
“Yes. They have no choice. Dad told me that there are dozens of abandoned homesteads in our county now, and all over the state, too. But six million! I had no idea.”
There were a lot of quiet conversations going on around the room, and Reginald seemed content to let it run. Finally, as things quieted, he lifted his head. “So,” he began as everyone quickly fell silent, “this brings us to why we are here tonight. Though it sounds cruel to put it this way, it is nevertheless a fact: one man’s tragedy is another man’s opportunity.”
So that’s it? The golden eagles swoop down on the helpless rabbits. Frank felt a great wave of revulsion sweep over him.
Somewhere behind him, a man was muttering loudly to his wife. “Buy up useless farms as an investment? He can’t be serious. Who’s going to buy it?”
Reginald heard the comment and pounced on it at once. “We are, Carl.” Then he laughed as others gasped. “Yes, my friends, we are. But not to become farmers. Oh, no. Right now, that would be foolish indeed.”
Frank was staring at the floor, sick with what he was hearing. Are you really proposing to earn fortunes off of the shattered lives of others? Suddenly, Celeste nudged him hard with her elbow. Frank looked up to see that his father-in-law was once again looking directly at him. “It seems crass to speak about profiting from the misfortunes of others.”
“Yes, it does,” Frank said softly, but loud enough for all to hear.
To his surprise, Reginald smiled, as if that were the very answer he was hoping for. “But what if there were an opportunity to lessen the extent of the tragedy for the victims, and thus bless both of us?”
“Equally?” Frank asked, his eyes locked on Reginald’s.
There was a quick flash of irritation in Reginald’s eyes. “Of course not, because the investment required to make this happen is not shared equally by both sides. But I promise you this: those we reach out to will thank us with tears in their eyes.” He swung around to his associates. “Claude, why don’t you begin?”
8:20 p.m.
It was so simple in concept it was almost breathtaking, and when Claude was finished and sat down again, Frank’s initial disgust had turned to wonder. Oh, he wasn’t fooled by Reginald’s “sorrowful concerns” for the plight of the poor farmers. There might be a modicum of truth in his feelings for their plight, but the men and women in this room were clearly going to get very, very rich from this. But that said, the plan clearly would also bless the lives of thousands of good men and women out there. For this was not about farming at all. It was about land development.
As Rutherford began, Celeste had taken out a pencil and a small notebook from her purse and handed them to Frank. Obviously she had known more about this meeting than she had let on. But he took them and wrote as fast as he could.
They were going to create a new financial entity called DR&A Land and Title Company—Dickerson, Rutherford, and Ashbridge. The initial stock offering was one million shares to be sold at ten dollars per share to initial investors—the men and women in this room. Minimum purchase was 25,000 shares, or $250,000. But as was a common practice in the stock market, purchases could be made on margin, that is, with thirty percent down at purchase, and the rest not due until the stock was sold, hopefully at double or triple the price of purchase.
As soon as the price of the stock doubled, which Rutherford assured them would occur within a few months, they would offer an additional one million shares at twenty dollars per share, with a twenty percent margin required at purchase. The initial investors would share in the profits from this expanded sale.
Five urban areas had been identified. These were chosen because they were currently undergoing rapid growth and exploding populations. They were mostly burgeoning manufacturing centers or major transportation and distribution hubs. The sites were Pittsburgh, Pennsylvania; Chicago, Illinois; Cleveland, Ohio; Detroit, Michigan; and St. Louis, Missouri. Work was already under way to identify five more sites if their plans went as they hoped. A regional office of DR&A would be set up in each of these cities, with additional branch offices added as needed.
With the capital raised by the stock offering, DR&A would immediately set to work purchasing farmland that was either for sale by anxious owners or held by banks desperate to sell their unsellable land.
Here was where the brilliant part came in, and Frank guessed that it was mostly Reginald’s idea. It wasn’t just any farmland they were looking for. They had experts mapping out where urban expansion was most likely to occur, even as far out as five to ten years, and that was what they would buy up.
Urban property values were already skyrocketing as cities took in more and more citizens and land was needed to house them. But farmland was still far enough out from the city limits that no one was looking at it yet. It was like a tree filled with low-hanging fruit that was just out of sight of the passing public.
At that point, Frank had raised his hand. “And how much are you going to offer the farmers for their land?” Reginald had immediately stood and fielded the question.
“Five to ten cents on the dollar, pre-depression price.” Then before Frank could protest, he went on quickly. “For those families whose lands were foreclosed on by the banks, we can do nothing. The bank holds title already.”
“I see that,” Frank had shot right back. “But what about the farmer who is desperately trying to sell the land that he owns? You’re going to offer him a nickel on the dollar? That’s how you’re going to benefit him?”
“It will depend on the land, of course, but generally, that is now the market price of their land. We don’t set that price. An appraiser does. And in most cases that’s about the ratio of what it was worth before farm prices started to plummet, five or ten percent.”
“You’re still taking advantage of him,” Frank had argued, feeling his temper rising. Celeste had been tugging on his pant leg by that time, but to Frank’s surprise, Babette had pulled her back. “Your father’s a big boy, Celeste,” she said in a low voice. “Let Frank ask his questions. He’s got a stake in this too.”
It had been clear that Reginald was a little irritated with his son-in-law, but he kept it under control. “No, Frank. We’re taking advantage of the circumstances he’s in, but we didn’t create those circumstances.”
That concept struck Frank with some force. He didn’t l
ike it. But Reginald was right. He and his bank weren’t responsible for those conditions.
“That’s life, Frank,” Reginald went on. “And we’re not going to make it worse for the farmer; we’re making it better, even though the whole situation is tragic. He can always turn down our offer.”
“He won’t,” Frank cried, “because he’ll have no other choice.”
“Ah,” Reginald had said triumphantly, “and he won’t because he’ll come away with something, rather than just having to walk away with nothing in hand. Right?”
There was only one answer to that, so Frank nodded and shut up.
9:30 p.m.—Highway 16, Newton, Massachusetts
By the time they had come out of the meeting it was snowing steadily, so they hadn’t said much as they left Boston and drove through Cambridge, the roads getting slicker with every mile. But it was lightening up the farther they moved away from the bay, and now there were patches of bare pavement beneath them, so Frank accelerated a little.
“Are you going to say anything?” Celeste finally asked.
Frank turned. “About what?”
She gave him a pitying look.
“What is there to say? I don’t like it. It’s the poor that always end up the losers. But your father’s right. That’s not their doing.”
“So you don’t think Daddy is a crook?”
Frank hooted softly. “I never said that.”
“You implied it,” Celeste said pointedly.
“No I didn’t, Celeste. Nothing he’s doing is illegal in any way.”
“It’s just not ethical, right?” There was a touch of bitterness in her voice.
“I didn’t say that either.”
“But you—”
Frank rushed on. “All right, I did imply that. But his answer was a good one. They didn’t create the situation; they’re just taking advantage of it.”
“And helping the desperate farmer as they do so.”
“Yes, that too. And that’s life, I guess.”
Celeste moved closer and snuggled against him. “Good. I couldn’t believe you took him on like that in front of everyone. People don’t usually do that to Daddy.”
“I’m surprised your mother didn’t get angry.”
“Oh, nothing you do makes Mother angry.” It was said with a bit of a barb to it. Frank decided to let it pass.
“Which reminds me,” he said, “what did she mean when she said that I’ve got a stake in this too? A stake in what?”
Celeste stared out at the snowflakes being caught in the light of the headlamps. Finally, she inhaled deeply and let it out in a low sigh. “A stake in the new company.”
“I’m not part of that in any way. Why do you say that?”
“You’re my husband. Therefore you have a stake in it.”
Still puzzled, Frank gave her a long look. “Are you talking about a financial stake? I don’t have any of my own money. And all we’ve got is six or seven thousand dollars in the bank. That’s a bit short of the seventy-five thousand minimum we need.”
For another long moment Celeste looked up at him, her eyes large and luminous. Then she reached up and kissed him on the cheek. “I love you, Frank. You are a wonder.”
He was staring at her. “Am I missing something here?”
“Have you really forgotten about my trust fund?”
“Oh! Uh . . . no.”
“Yes you did. And I love you for it.”
“I didn’t forget it, I just never think of it. It’s in the bank. We don’t use it. And besides, that’s yours.”
“No, Frank. By law, it’s ours.”
“I don’t care. That’s your money, and you can use it any way you want.”
“Do you even know how much is in there now?” Celeste asked.
“You said your father gave you $50,000 on your sixteenth birthday,” Frank answered.
“Yes, to be made available to me when I turned twenty-one. But remember, when Grandfather Durand died, I received another $100,000 from him as my inheritance.”
“Oh, yeah, I had forgotten that. That’s been . . . what? Three years ago?”
“Four. And don’t forget interest. And that Daddy’s been investing it for me.”
The snow was starting to blow across the road, so Frank slowed. Up ahead he could see the turnoff into the Brae Burn Country Club and knew they were getting close to home. “So, how much is there now?”
“About $263,000.”
Frank gave a low whistle. “Really?” Then he grinned. “No wonder I love you so much.”
Celeste slugged him. “So, what do you think?”
“Think about what?”
“Me taking that money and investing in Daddy’s new company?”
Frank drew in a sharp breath. “All of it?”
“I was thinking more like two hundred and fifty thousand of it. Mother received half a million from Grand-père when he died. She’s thinking of buying fifty thousand shares. If you agree, I’m thinking of buying twenty-five thousand. And Daddy recommends we don’t buy them on margin. Since we have the cash, if we buy them outright, we will get a higher percentage of the initial profits.”
Frank braked as they turned the corner and headed south. “Is that what you want to do?”
“I think so. What do you want to do?”
“I mean it, Celeste. It’s your money. Do with it what you wish.”
“But I want to know what you think. Is this a stupid thing to do?”
Frank considered that and then said, “Celeste, I think your father is a brilliant man. And I think that in the next five or six years he’s going to triple, or quadruple, or maybe even quintuple your investment.”
Celeste giggled. “Is that what they teach you in physics, how to say quintuple?”
Frank put his arm around her neck and pulled her around so he could kiss her full on the lips.
Celeste jerked back. “Frank, watch the road!”
He just grinned. “That’s what they taught me in physics.” Then he became serious. “I have only one concern about the investment.”
“What?”
“If you’re worth a million dollars in five years, does that mean I’m going to have to treat you with more respect?”
Celeste laid her head on his shoulder. “Absolutely,” she murmured.
Chapter Notes
The facts about the drop in farm prices and the resulting “farm flight” in the 1920s is accurate (see Kyvig, Daily Life, 236), but the scheme for profiting from those circumstances is not based on any actual situation.
May 13, 1929, 2:38 p.m.—EDW Ranch, Monticello, Utah
“Grandma?”
Edie looked up. “Yes, Logan?”
“When are we going to have your party?”
“In about three hours. We have to wait for your brothers, sisters, and cousins to get home from school. And Aunt Tina and Uncle Monte will be here at about five. Then we’ll have supper together, and then we’ll have the birthday party.”
They were on the front porch of the ranch house. June, Rena, and Mitch had kicked Edie out of the house when she kept trying to help them prepare the evening meal. Now she had Wyatt in her lap sleeping. He was June and MJ’s youngest child and Edie’s youngest grandchild. He had been born the previous November. He was sleeping peacefully through the chatter coming from the three grandchildren who were still preschoolers. They had been told by their parents to go out and keep Grandma company. To Edie’s delight, they were taking that charge very seriously.
“Are you old, Grandma?” Logan asked.
Edie smiled. “Yes, Logan, I think I qualify for that title.”
“Are you as old as Mommy?” That came from Claire, Rena’s second to youngest. She had bright blue eyes and dimples that flashed like semaphores when she smiled, which
was almost all the time.
“Of course she is, Dummkopf,” Logan cried. “Grandma is your mommy’s mommy! Right, Grandma?”
“That’s right. But it’s not nice to call people a Dummkopf, Logan.”
His head dropped. “Sorry.”
“How old are you?” Julius asked. He was Claire’s younger brother.
Claire answered for her. “Fifty eleven?”
Edie laughed. “That’s pretty close, actually. I am fifty-nine today.”
“Whoa,” Logan said in awe. “That is old!”
Just then they heard the ringing of the phone from inside the house. Edie turned and called through the screen door. “Do you want me to get that?”
“Got it,” Mitch called from inside.
Claire had another question. “How come Abby and Benji have birthdays today too? Can people have birthdays on the same day?”
“Yes, they can,” Edie answered. “And do you know why the three of us have the same birthday?”
They shook their heads.
“Because fourteen years ago, Abby and Benji were my birthday present from Heavenly Father. And that’s the best birthday present I ever received.”
Just then Mitch appeared at the screen door. “Phone is for you, Schatzi. It’s Frank. I’ll take the baby in to June. He wants to talk to both of us.”
As they went back into the house, Mitch took Edie’s elbow and steered her toward the hallway. “Take it in the bedroom. It will be much quieter. I’ll pick up the line in the kitchen. He asked that we both be on.”
Inside the bedroom, Edie sat down at the dressing table and picked up the phone. “Frank?”
“Happy birthday to you, happy birthday to you.” Both Frank and Celeste were singing. “Happy birthday, dear Grandma,” they sang together, “happy birthday to you.”
“Thank you,” Edie said. “How good to hear your voices. How are you both doing?”
“We’re doing wonderfully,” Celeste said.
“And how is my little Reginald?”
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