The IT&T directors called on their bankers from J. P. Morgan. There was no question what Morgan would say, particularly given the previous tensions between Jack Morgan and Ivar. As Morgan recommended, the directors of IT&T immediately sought to rescind the contract with Ivar. They wanted IT&T’s 11 million dollars back, and they jumped at the chance to return the Ericsson shares, which had declined in value since June.
On Tuesday, February 16, Ivar begged Littorin to come up with some money. He wrote,Arrangements I thought would produce amount necessary for acceptance credit fell through. It is vital avoid default tomorrow. This should be made clear to banks. If absolutely impossible have funds telegraphed tomorrow then company should cable a statement explaining delay and stating that money will be wired following day. If nothing is possible then wish company to cable a statement explaining how it proposes to meet the obligations.7
Littorin managed to persuade a few banks to extend a brief credit line. But the fact that International Match would survive another few days didn’t sway anyone from Price Waterhouse, J. P. Morgan, or IT&T. On Friday, February 19, 1932, Sosthenes Behn met with Ivar in New York to deliver the bad news: their deal was off. Behn wanted his 11 million dollars.
If Ivar was upset, he didn’t show it. With his best poker face, he responded calmly that it was merely a translation error. The German bonds were there in place of the cash temporarily; Ericsson had a short-term loan to Kreuger & Toll, and would soon receive the cash back. Didn’t the IT&T directors also see that Ivar had personally guaranteed Ericsson’s obligations? Ivar insisted that there was nothing to worry about. Nevertheless, he said he would rescind the agreement if that was what IT&T wanted.
It was. Sosthenes Behn accepted a written satisfaction from Ivar promising to repay IT&T 11 million dollars in cash before September.8
Ivar obviously didn’t have 11 million dollars. Nor did he have a chance of raising any more money. In four days, Swedish Match would need to repay a 2 million dollar loan. Then, more interest payments would come due. Without a miracle, Ivar’s companies soon would be in default.
That weekend, Ivar acted like a man who didn’t think his businesses would survive. He frantically cabled relatives in Sweden, instructing them as to how to divide various securities among the members of his family. He wired Krister Littorin to arrange delivery of millions of dollars of debentures to Anders Jordahl, presumably so Ivar would have something of value to distribute to friends in the United States.9
As Ivar sent these telegraphs continuously for hours, he resembled the energetic and focused man who had amazed the passengers peering into Berengaria ’s radio shack back in 1922. Then, during his first trip to woo Lee Higginson in New York, he had merely been pretending, putting on a carefully planned show. But now, Ivar’s actions were not planned. This was no act; this mania was real.
Ivar seriously contemplated suicide during this time.10 One visitor said he noticed a shotgun in an umbrella stand at Ivar’s Park Avenue apartment. Ivar sent Karin Bökman a letter with three 10,000-dollar banknotes, and wrote that because his business prospects were not good he wanted to leave her something “while he still had the opportunity” - he ended the letter, “Goodbye and thank you.”11 Ivar refused all visitors, saying he was tired and ill. At one point, his housekeeper saw him muttering financial figures incoherently and persuaded him to lie down.
By Sunday, February 21, Ivar was a wreck.
Durant heard the bad news about IT&T, but had been unable to reach Ivar. That afternoon, he finally decided to visit Ivar at his apartment. The 4 million dollar loan he had arranged for Ivar six months earlier would be due in a few days. Durant wanted a witness, so he asked George Murnane, who also knew about the failed Ericsson-IT&T deal, to join him. Durant waited for Murnane to attend Sunday church services, and then they walked to the southeast corner of 74th Street and Park Avenue. They paused in front of 791 Park, Ivar’s building. The sturdy two-story base and arched windows hid what was crumbling inside.
Durant and Murnane rode the elevator to the ten-room penthouse. Ivar had bought the apartment in 1927, around the time of the French deal, and he had spent every fall there since then. The roof garden was one of the quietest spots in the city, due to a high brick parapet and a copse of willow trees Ivar had planted. The novelist Edna Ferber, who would take over the apartment in a few months, called it an “unbelievable country house in the sky.”12
A servant led them to the right. Durant had remembered the dining room as being very bright, with a silver chandelier and red lights in the cornices. But everything was dark now. Silver plate was stacked on a long, wide sideboard, near where the Prince of Sweden had once stood during a party. The paintings by Dutch masters - Van Ruysdael, Van der Werff, Brueghel, and even a small self-portrait by Rembrandt, works that Douglas Fairbanks, Greta Garbo, and Mary Pickford had once admired - hung in shadow. Ivar’s gramophone, which had entertained so many world leaders, was silent.
Durant and Murnane entered the library and walked past Ivar’s large writing desk and the bookcases filled with some of his letters and his collection of volumes on Napoleon. A small adjacent alcove, with no windows, contained Ivar’s collection of Rembrandt etchings, the third largest in the world. On one wall of the library was a Rubens painting of some satyrs. On the ceiling was a painting on silk, which could be lit from above. But this painting, too, was dark.
The men found Ivar seated in a corner of the library facing Park Avenue, on a slightly raised platform near a curved bench with a view of the skyline.13 Although it was midday, he was wearing yellow silk pajamas and a purple silk dressing gown. Murnane described the scene:We found him in a terrible state. He was almost unrecognizable as he sat huddled in a chair in front of the fireplace. He talked in jumps, with his hand to his head, and then paused for minutes at a time. It seemed unreasonable to discuss anything with him. “I’m so tired that I just can’t seem to get down to anything,” he said. He was in a very nervous state. That is what alarmed us so - it was not like him.14
Durant called Ivar’s doctor, Joseph Wheelright, a respected physician who also had several Morgan partners as patients. Ivar managed to dictate a cable to Littorin, which Durant sent.15 Otherwise, Ivar was silent. Durant and Murnane went out to the garden to wait until the doctor arrived.
During earlier visits, Durant had walked with Ivar along the flagstone path that wound through the rock garden and among the fountains and willow trees. The path wasn’t long, but it was a unique spot for the east side of Manhattan. Ivar had enjoyed being able to stroll past many of his favorite plantings without leaving the building. He knew the scientific names for every one: a grape arbor thirty feet long, an eighteen-inch circumference peach tree, espaliered apple trees, rhododendrons, wisteria, ivy, roses, lilac bushes, iris, forsythia, strawberry plants, and rhubarb. Edna Ferber later remarked, with surprise, that the trees actually “bore fruit in this bizarre Eden.”16
Durant and Murnane nervously discussed what might happen if Ivar didn’t recover. How had Lee Higg become so exposed to one man? Were they ruined? As the two men walked back on the garden path, they had no answers. The golden heads of the jonquils would not emerge for a few months. The plants were as quiet as Ivar had been.
Inside, Dr Wheelright diagnosed cardiac fatigue. He prescribed some sedatives and said Ivar should rest. During the next three days, Ivar would cycle through episodes of mania and depression. When the drugs were working, he would simply sit and stare into space. But when the medication wore off, he would stand and shout, “I’m losing my mind, I can’t remember, I can’t think.” He placed dozens of emergency telephone calls. He imagined knocks at the door. He answered the phone even though it hadn’t rung. He sent cables to imagined addresses in Amsterdam, Berlin, Paris, Stockholm, and Warsaw.17 And then he collapsed. His New York assistant, Alexis Aminoff, who visited one evening, described Ivar as “a deplorable sight.”18
While Ivar suffered in New York, Krister Littorin and Sigurd Hennig rummaged
for funds in Stockholm. They went to banks, the finance ministry, and the Riksbank, but everyone wanted fresh collateral before they would lend more money. That evening the men went to the Match Palace to search for something of value to pledge. At first, they found nothing in Ivar’s office. Then, Littorin noticed that Ivar’s safe, which he had thought was just for show, was closed and locked. Ivar had entrusted his assistant, Karin Bökman, with the combination, so Littorin called Miss Bökman to open it.
Inside the safe, Littorin found three envelopes filled with Italian treasury bills. He couldn’t believe it. Hennig was astonished, too. These bills resolved everything! Why hadn’t Ivar mentioned them before? The bills were not pledged, so they could be used as collateral for a loan. Littorin added up the face amounts of the treasury bills. They were worth about 100 million dollars, much more than they needed. It seemed that Ivar, and they, were saved.
Littorin grabbed one of the working phones on Ivar’s desk and called the prime minister of Sweden, Carl Gustav Ekman. Ivar had supported Ekman with a large political donation. Now, it was time for the Prime Minister to return the favor. Ekman was delighted to hear about the Italian bills, and said the government would provide enough support for the necessary loans. With that promise, a few Swedish banks were willing to lend Ivar enough money to survive until March. Littorin signed loan documents with the Swedish Central Bank that weekend, so that they would send Lee Higginson 1.2 million dollars by Monday morning.19
Littorin cabled the good news to Ivar, who was relieved, at least at first. However, as a condition for the new loans, the bankers had demanded that Ivar come to Europe to meet them, explain his companies’ financial status in detail, and answer all of their questions. Ivar saw that it would be almost impossible to avoid the meeting. He needed to prepare some compelling answers during the next two weeks. Perhaps the Italian bills would be enough.
Meanwhile, Littorin began to prepare for the bankers’ questions. On Thursday, February 25, Littorin relayed to Ivar that “Country X” - presumably Italy - was the solution to the problem of the missing German bonds, the ones Ivar had transferred out of International Match’s account in order to free the Boliden shares for a loan. Littorin said the German “bonds have been exchanged against corresponding value of securities from country X. We have not advised New York yet as we wanted to await your arrival before definitely formulating minutes of the meeting.”20
The 4 million dollar loan Lee Higginson had arranged six months earlier would be due in two days. In an apparent moment of clarity, Ivar told George Murnane, the Lee Higginson partner, that he secretly owned 350,000 shares of Diamond Match, the American match company, and could pledge those shares as collateral. Ivar also said he was expecting payments from Spain soon. With those promises, and some additional collateral, Lee Higginson and its syndicate agreed to extend their 4 million dollar loan for another three months.21 They didn’t have much of a choice.
When Berning learned about Ivar’s promises and the Germany-for-Country X swap, his response was meek.22 Berning timidly wrote to Ivar about some technical accounting problems of Swedish Pulp Company, in the hope he could secure a meeting to discuss more important issues. Berning said, “I do not know whether or not you wish to discuss this while you are here in New York. If you care to do so and have the time, I would be pleased to be available at your convenience. Otherwise, I will await your further wishes.”23 When Ivar didn’t respond, Berning went to Ivar’s apartment, but was turned away.24 Berning knew he was running out of options, but he also saw that, if Ivar’s companies collapsed, every finger would point at him.
After two more days, a combination of Dr Wheelright’s sedatives, some rest, and the continuation of what apparently passed as good news from Littorin led Ivar to recover. Ivar finally called Rydbeck and agreed to meet with all of his bankers on March 12. Littorin was “glad to learn from Oscar that you are prepared meet him in Paris. Also happy over cable from Donald that you have recovered from your illness and feel fit again.”25
Littorin sent his final cable to Ivar in New York on March 2, 1932, exactly fifty-two years after Ivar had been born in Kalmar. Littorin wrote, simply, “All good wishes for your birthday.”26
Before sailing for New York, Ivar had called Isaac Marcosson and arranged for a last round of interviews, this time at Marcosson’s apartment.27 This was Ivar’s last shot at preserving a legacy, and he once again chose Marcosson as his exclusive conduit.
Since the snub by Time, Ivar had become even more isolated and refused nearly all contact with the media. Before his breakdown, he had given a talk at the Bankers Club, but when the Wall Street Journal asked to publish the talk in its entirety, Ivar said no.28 Likewise, when Karl Bickel, the president of United Press, learned that Ivar was in New York, he wrote begging for Ivar’s “reactions to the present situation.” Bickel had met several times with President Hoover, and he praised Ivar’s prescience on issues “you saw clearly months before most of them at the capital began to dimly comprehend.”29 But again, Ivar refused the interview. Ivar would rely entirely on Marcosson.
The man who arrived at Marcosson’s apartment at 119 East 19th Street bore little resemblance to the real Ivar, if there still was such a thing. Marcosson didn’t know Ivar well enough to see how much his behavior was out of character.30
Previously, Ivar had rarely smoked, unless he thought it would serve some social purpose. Now, he smoked before, during, and after lunch, putting down a half-finished cigarette and then lighting a fresh one. Although Ivar generally didn’t eat much food or drink alcohol, particularly at lunch, he demonstrated a hearty appetite for Mrs Marcosson’s cooking. She made a heavy cheese and bacon dish, and, instead of nibbling at the edges as he typically would, Ivar devoured his portion and asked for an extra helping, along with a large pewter mug of beer. After he ate the second portion, he rushed to the kitchen to congratulate Mrs Marcosson on the dish. They decided to call it Soufflé à la Kreuger. Ivar returned to the apartment for five more interviews, and five more lunches, and she served their special dish each time.
Ivar had always been a charming guest, and he put on an urbane show for the Marcossons. But anyone who knew him well would have seen a new person. One of Ivar’s most consistent traits since childhood had been that he rarely laughed. Yet now he was suddenly a comedian, relaying humorous anecdotes throughout the day and cackling after the punch lines. When the Marcossons invited Nigel Bruce, the English actor, to one of the lunches, Ivar and Bruce traded jokes for hours.
Throughout the interviews with Marcosson, Ivar was prolific with detail about his businesses. One of the first things he told Marcosson was, “I am no Stinnes,” referring to Hugo Stinnes, the German industrialist and politician who owned thousands of companies and manufacturing plants. Ivar said, “The Stinnes Konzern was a jumble of unrelated properties without unified direction. What I have acquired bears directly on match production and distribution.”31
According to Ivar, by 1932 he had 225 subsidiaries. He had operations in every civilized country except Russia, and he manufactured three-quarters of the world’s matches. Ivar had secured match monopolies in twenty-four countries. During seven years, he had loaned almost 300 million dollars to European governments. Ivar’s loans had helped borrower governments repair their countries. The Romanian government stabilized its currency after the world war. The Latvian government purchased food and essentials, including seed grain. The Estonian government built railroads. The Greek government repatriated thousands of refugees. The French government moored its currency to a fixed exchange rate, to prevent a repeat of the cycle of depreciation and hyperinflation that had hit Germany a few years earlier.
Although Ivar insisted he was no Stinnes, his organization extended well beyond matches. Marcosson was convinced that Ivar had a unique vision, a flair for organization, and an uncanny sense of salesmanship in many new businesses. Ivar’s phone company, Ericsson, had factories in a dozen countries and monopoly concessions in five. Ivar’s
mining company, Boliden, controlled the Swedish output of precious metals and ore. Ivar also owned a fifth of the Grängesberg iron mines in central Sweden. His sulphite company, Swedish Pulp, was the largest producer of that compound. Ivar also owned banks in Paris, Warsaw, Berlin, and Amsterdam, as well as newspapers, office buildings, apartment houses, and film companies throughout the world.
Ivar insisted he had no ambition to become the richest man in the world. Indeed, Marcosson said Ivar expressed the utmost contempt for personal wealth and told him, “Money, as such, means nothing to me. I cannot tell you how much I am worth - I don’t care.”32 Oscar Rydbeck, the Swedish banker, had claimed Ivar was the third richest man in the world, but Ivar neither confirmed nor denied it.33 It simply didn’t matter.
When Ivar finally said goodbye, Marcosson didn’t notice anything unusual. He didn’t see any inconsistencies in Ivar’s personality. When friends later asked about Ivar’s behavior during the interviews, Marcosson replied, “Except for the fact that he smoked more cigarettes than usual he was the same serene, impassive Kreuger that I had known in the years before.” Marcosson couldn’t believe Ivar had just been ill, or that he had considered suicide. According to Marcosson, Ivar “always gave the impression of not having a nerve in his physical make-up. It was inconceivable therefore that he could have succumbed to a sudden crack-up and, in tabloid parlance, ended it all.”34
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