History of Chicago. From the earliest period to the present time, Part 37

Author: Andreas, Alfred Theodore
Publication date: 1884
Publisher: Chicago, A. T. Andreas
Number of Pages: 1340

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" But the day of retribution was at hand; the reaction came- and the professional speculator and his victims were swallowed up in one common ruin. Trusting to the large sums due to him, the land operator involved himself more and more deeply, until his fate was more pitiable than that of his defrauded dupes.

"The year 1837 will ever be remembered as the era of pro- tested notes; it was the harvest to the notary and the lawyer-the year of wrath to the mercantile, producing, and laboring interests. Misery inscribed its name on many a face but lately radiant with high hopes; despair was stamped on many a countenance which was wont to be 'wreathed in smiles.' Broken fortunes, blasted bopes, aye, and blighted characters: these were the legitimate off- spring of those pestilent times. The land resounded with the groans of ruined men, and the sobs of defrauded women, who had entrusted their all to greedy speculators. Political events, which had hitherto favored these wild chimeras, now conspired to hasten and aggravate the impending downfall. It was a scene of woe and desolation. Temporary relief came in the shape of Michigan money-but like all empty expedients, it, in the end, aggravated the disease it pretended to cure-it seemed a sovereign panacea, but it proved a quack specific. Let us turn from this sickening spectacle of disaster and ruin. Mad as her citizens had been, Chi- cago was Chicago still. Artificial enterprises had failed, but nature was still the same. There stood Chicago 'in her pride of place '- unmoved and immovable. Though mourning and desolate, she could still sustain an active population. Need I add that SHE HAS DONE IT ?"

The delinquent tax-list, published in the American, October 1, 1836, showed a large number of lots owned by non-residents. The taxes levied and remaining un- paid were ridiculously small, in comparison with the high market valuation then current. Doubtless many of the visionary owners, who counted their wealth in these lots by thousands had not the wherewith in ready money to pay the taxes on their possessions, small as they were. Of two hundred and twenty lots advertised in Section 16, one hundred and fifty-five were taxed less than one dollar each ; forty-two, from Si to $5 ; ten, from $5 to Sto; twenty-two, from Sio to $25 ; and one at $39. In Wolcott's addition, one lot was taxed $10.50; three, from $7.50 to Sio; and others at less than 87 each. In North Branch addition, no single lot adver- tised was taxed as high as one dollar, In Wanbansia

136

HISTORY OF EARLY CHICAGO.

addition, the three lots advertised were assessed, re- spectively, $2.50, $3.50 and $7.50. In the original town, Section 9, the lots were assessed-one for $50.50; 'two for $30, one for $19, thirteen from $17 to Sio, and eighteen for less than Sto. At that time it is apparent that the most valuable property, in the practical eyes of the assessors, was on the old town plat.

The following extracts, letters and personal reminis- cences, more or less relevant, will give the reader a more distinct idea of the occurrences, and the people, while the excitement was at its height, than could be obtained from an unbroken narrative.

The incipient stages of the disease, as it began to show in old residents, is told in a short letter, dated August 18, 1883, from Dr. Horace Chase, now a resi- dent and a leading citizen of Milwaukee. He writes :

"Soon after the sale of lots in Chicago, in 1833, I think, Robert Kinzie, on his way to Detroit, stopped at Marsh's trading- post, near Coldwater. There happened to be several of us pres- ent, and Bob, finding an audience he took for green-horus, began to boast about Chicago, and what a great city it would become. " Why,' said he, 'I bought some of the best lots in Chicago for twenty dollars apiece, and, by G --- , those lots are worth sixty dollars apiece to-day.' It seemed to us utterly absurd that a lot should be worth sixty dollars, when two hundred dollars would buy one hundred and sixty acres of land of the best quality, and in 1833 there were tens of thousands of such chances in Michigan. Not a single person in the crowd believed Bob's yarn."

John S. Wright,* in his most valuable book, "Chi- cago : Past, Present, and Future," gives his own experi- ence during the speculative era. He died in Philadel- phia, September 26, 1874. His remains rest in Rose Hill, Chicago. From his autobiographical sketch, pp. 289, 290, the following interesting extracts are taken :

" In 1832, at the age of seventeen, my father took me to Chi- cago with a stock of merchandise. The town then contained some one hundred and fifty people (exclusive of the garrison), two framed stores and no dwellings, except those built of logs. After remain- ing a few weeks, examining the country south and west, and satis- fying myself that he had made the right location, he left me to shift for myself. In 1834 he removed his family to Chicago and lived until 1840, having his first convictions strengthened year by year that it was rapidly to become one of the largest cities of the country, and of the world.

" Though a mere boy, I, too, became impressed with the ad- vantages of the point which was the western extremity of the great lake navigation, with a certainty of its connection by canal with the Illinois and Mississippi rivers, and which was the natural com- mercial center of a country so fertile, and so easily tilled, and so vast in extent. In the winter of 1833 and 1834, I induced a wealthy uncle to take some purchases which I had made, expecting to share in the profits. He took them, and has made out of those and other opera- tions, through me, several hundred thousand dollars, but all the benefit to me, directly or indirectly, has been $100. He came to Chicago in the spring of 1835, and the next day after his arrival said, if I would sell his lot-one of those which I had bought fifteen months previously for $3.500-for $15. 000, he would give me one hundred dollars ! I sold the lot that day for cash and the Stoo was reckoned into my credit in our final settlement in 1835. * * *

In 1834 I began to operate in real estate on my own account, and in February, 1835, went to New York to huy merchandise, and sold for Sto,ooo an eighty-acre tract which had cost 84,000, the profits of which more than paid for all my other purchases. T'here- after increasing my operations, I sold in the spring of 1836, to

various parties in New York, real estate for over $50,000, receiving about two-thirds of the pay cash in hand, and giving my individual obligations to make the conveyance when I came of age, the July following. My father would have been my heir, in the event of my deatb, and they knew he would fulhill my contracts. I had, then, in 1836, acquired a property of over $200,000, without any assist- ance even from my father, never having used his money for my operations, the store being his, and for conducting it only my ex- penses had been paid. My uncle was the only relative who could have aided me, and he never would, even temporarily. So far from it. he was in my debt continuously from 1834 to our final settlement in 1838. But 1837 brought ruin to me, as it did to nearly all who owed anything ; though it was not so much speculation in real estate as engaging in mercantile business that involved me. At that age it seemed desirable every way to have regular occupation to promote good habits, and in accordance with my father's wishes, I purchased in IS36 a warehouse and dock-lots, to engage in the shipping business, which cost $23.500. My whole indebtedness was about $25,000. I had nearly $20,coo due to me, which was supposed to be well secured, it being chiefly the final payments on property of which over half the cost had been paid. To provide ample means for business, I sold in the autumn of 1836 a tract ad- joining the city for $50,000, quick pay. This trade was unfort- unately broken up by the merest accident, and thereafter I had no opportunity to sell at what was deemed a fair price. I came in possession of the warehouse May 1, 1837; and though having small cash resources, I thought best to commence business, hoping there would soon be a favorable turn. But all went down, down, and I was soon inextricably involved. The money used to buy those lots for business, not speculation, would have carried me through. By IS40, my property had all gone ; one piece that had been worth $100, 000, went for $6,000; another that had been worth $12,000 went for $900, and so on."

J. D. Bonnell, a young man of far more ardent hope than his financial condition would warrant, came to Chicago in 1837. He subsequently found a safe haven in Lake City, Minn. From that place he wrote to.the Chicago Times a letter dated March 15, 1876, from which the following is quoted :

" My first entry into the city of Chicago was forty years ago, August 25, 1835, approaching the city on foot from the south. On emerging from the oak openings, I came upon the hotel of Hollis Newton, and on entering the house I found the landlord at home. and alone. Asking him how far it was to Chicago, he informed me it was three miles, and in answer to whether there was any house on the way, he said yes-that Mr. Clarke's house was about hall way. On his asking where I came from and for what I came, I answered that I had made a claim in Thorn Grove for my parents, who were soon coming on, with ox teams, from Ohio, and that I was going into the town to learn what I could find to do. He im- mediately proposed to sell me his tavern stand with the forty-acre lot upon which it stood, for $500, so that he could go on to a farm, for he was 'd-d sick of keeping tavern on that sandy beach, where his eyes were constantly full of sand.' But I declined to make any bargain with him, and jogged along over the sand hills for Fort Dearborn and Chicago, where I arrived in the evening, having walked from Thorn Grove via Thornton, thirty-three miles, to Chi- cago, that _day ; which, if taken into consideration, away back in those days, when there was scarcely a road at all, was a good day's walk. And yet, by the Hoosiers on the Chicago & Cincinnati rond, there was much teaming in 'prairie schnoners,' in bringing corn-meal and bacon to the Chicago market, and loading back with salt.

"On arriving at Chicago I stopped over night at the Mansion House. In the morning I commenced looking over the town and prospecting for a boarding-place, and to learn what I could find to do. The hotels were all pretty full, and their prices ranging too high for my finances, I walked across the street, where the first thing that attracted my attention was the sound of a violin. On entering a small wooden stucture, their stond behind a rudely con- structed counter Mr. Dalton, a recent arrival frem Columbus, Ohio. a former tailor there, but who had now opened a liquor shop, and played the fiddle to attract customers.

" Passing cast, toward the mouth of the river, was the Lake House in course of construction, east of which was the residence of Dr. Kimball, who was a partner of Mr. l'ruyne in a drug store on South Water Street. Mr. I'ruyne was State Senator. Opposite Dr. Kimball's was Hunter & Hinsdale's warehouse. Adjoining on the west was Newherry & Dole's warehouse, and on one part of the latter building was the hat store of McCormick & Moon, of Detroit, Mr. Moon being the partner of the Chicago store. In the hack part of the store was Jesse Butler's tailor shop. In turn- ing the corner of Dr. Kimball's residence, away to the northeast, among the sand-hills, close hy the lake shore, stood a small yellow

* The extracts here given might, in the absence of other information. lead to a misapprehension concerning the character of Mr. Wright. Although a born trader and a bold speculator. he was a man of rare virturs, and during his long residence in Chicago was identified with nearly every enterprise and meas- ure calculated to promote its prosperity or elevate the eduratumal, mental, moral, or religious standards uf the city. The benefactions of this wonderfully energetic citizen perineited nearly every channel of Chicago life, and showed in every phase of her early growth. I'he building of the parly railroads, the development of mannfutures ; the first Presbyterim & hutch, sabbith st lumii. and the common school system of the State, the Press -- to all these he devoted his energirs, and gavr of his means in no stinted mashre. Frequent memim of him appears elsewhere in this volume-ser church history, schauis, maitroads, manufactures, the Press, etc. An old friend, Key. J. Ambrose Wight, at the close of a lung letter. dated February 1. 1876, deservedly rulogistic of him. thus sums up his business chararter : "Chicago -- old Chicago-korw Mr. Wright's peculiarities well enough. He saw further into a subirer in the trein- ning than most men. But oner in it, hr seemed to bee his ability to handle it. and often his interest in it : and the outcome sometimes threw undeserved oblo quy on the whule undertaking. Had hr been able to carry thing- through as he began them, he had probably been a millionaire, and alive to-day.'

$37

CHICAGO IN 1833-37.

house, occupied by Parnick Kelsey as a boarding-house, ostensibly run by Eve, Parnick's wife, for Mr. Kelsey was a sub-contractor in removing stumps and grubs, preparatory to the grading of the street on the North Side, through the swamps and bogs, which at that time rendered traveling almost impossible. But as Mrs. Kelsey had all the boarders that she could accommodate, I was obliged to seek other quarters.

" Dearborn Street at the time I write was the " lively " street, for Garrett's auction-room was located there, on the west side of the street, close to Cox & Duncan's clothing store, just opposite to which were Mr. Greenleaf's auction-rooms. To the latter place I was wont to go of evenings and bid off town and city lots, having the next day in which to secure a purchaser, and in case I failed to sell for an advance of my purchase I returned at night and paid Mr. Greenleaf a dollar and the property was offered again for sale.

" The winter of 1835-36 was a gay one for Chicago. Mr. Jackeax bad a dancing-school at the New York House once a week, which called out the elite of the city. Lincoln's coffee-house was the popular drinking place, situated, I think, on the corner of St. Clair and Wells streets. Mr. Lincoln had a favorite horse, an iron grey, and quite fleet on foot, particularly so when in pursuit of a prairie wolf. Many a time in the winter of 1835-36 I have seen Mr. Lincoln mount his horse when a wolf was in sight on the prairie toward Bridgeport, and within an hour's time come in with the wolf, having run him down with his horse and taken his life with a hatchet or other weapon.

" In 1833, Mr. Kingsbury, the original owner, offered all the land, and a great deal more than is now included in the Kingsbury estate to Captain Joseph Naper, for $900. Fortunately for the heirs the doughty Captain couldn't see the bargain, and Mr. Kings- bury was constrained, much against his will, to hold on to what he had. The land thus offered for Sooo included a good portion of the four blocks that surrounded the court-house square, including the Kingsbury and Ashland blocks.

" The most historic lot in Chicago undoubtedly is the one oc- cupied by the Tremont House. It has been in the 'raffle-box,' swapped for ponies, refused for a barrel of whisky, and when an old settler wants to give you an idea of the city when he first stuck his brogans in the mud, he will somehow associate the price of the Tremont House lot with it; and any old settler will tell the year of your arrival by giving him the value of the lot at that particular time. One old codger will tell you, ' When I came here I could have bought the lot the Tremont House stands on for a cord of wood.' That means 1831. Another puts the value, with the preliminary remark, at a pair of boots. That means 1832 A third fixes the price at a barrel of whisky. That means 1833. The fourth adds a yoke of steers and a barrel of flour. That means 1834. A fifth talks about $500. That means 1835. A year or two afterward it was worth $5,000, and now it is nearer $500,000. In 1833 Captain Luther Nichols refused to give Bap- tiste Beaubien forty cords of wood for it, and wood was then worth $1.25 per cord.

"John Noble still has in his possession the original deed, signed by the County Commissioners, conferring on him a title to the lot occupied by the ' Tivoli,' on the southwest corner of Clark and Washington streets, for the sum of $61 in lawful money. The deed is dated June 14, 1832. Many regard this as the most valua- ble lot in the city, and is worth in the neighborhood of $3,000 a front foot."

The following description of the metes and bounds is as appears in a deed of a piece of property situated on Chicago Avenne, adjoining the river, conveyed by John Noble to James B. Campbell and George E. Walker. It reads as follows :

"The following described tract or parcel of land, situated, lying and being in the county of Cook, in the State of Illinois, and being the one equal and undivided half of a lot or parcel of land transferred by Mark Noble, Sr., and wife, to James B. Campbell and George E. Walker, by deed bearing date the 28th day of August, 1833, and the said lot or parcel of land is bounded by the following metes and bounds, to-wit : Beginning at a hickory stake on the cast side of the road on the North Branch of the Chicago River, on the dividing line between Section 4 and river, in Township 39 north, Range 14 east, thence east along said line two chains and twenty links to a hickory stake cornered and running from a large basswood with three hacks, south eighty-five, west twenty-two links; thence north eight chains eighty-one links; thence west crossing a sluice to a white oak standing on the river bank, blazed on the south side, nine chains ninety-two links ; thence southeast along the shore of said river to the place of beginning, containing 10.04 acres, more or less."

Gurdon S. Hubbard, the oldest living scttler, still a

resident of Chicago, was, in those days, a bold and suc- cessful land speculator.

At the first sale of canal lots in 1829 in Section 9, he bought two lots, one on the northwest corner of Lake and LaSalle streets, and the other on the southwest corner of LaSalle and South Water streets. They were eighty by one hundred feet in size, and were bought for $33.33 each. In 1836 the lots would have found ready purchasers at ȘIoo.ooo. Mr. Hubbard disposed of a part of the property during the excitement, and the re- maining portion after the crash, on a falling market ; nevertheless, he realized in the aggregate, $80,000 on his investment of $66.33.

A chronicler in the Sunday Times, October 24, 1875, tells the following story concerning another large and successful operation, which illustrates how the mania raged in New York, and how that Eastern "bonanza" was worked by local operators in Chicago :.

"Early in the spring of 1835, about the month of March, Mr. Hubbard purchased, with two others, Messrs. Russell and Mather, what has since been known as Russell & Mather's addition to Chicago. This tract comprised eighty acres, and was bounded on the south by Kinzie Street, on the east by the river, on the north by Chicago Avenue, and then ran west to Halsted Street and be- yond. For these eighty acres they paid $5,000. At that time one section of the prospective city was as desirable as another, but time has developed that this particular eighty acres was one of the most undesirable within the entire territory. now embraced within the city limits. A few months after the purchase Mr. Hubbard had occa- sion to visit New York City, and to his surprise found the rage for - Chicago real estate at a point where it might be called 'wild.' Having sought and received the consent of one of his partners, who lived in Connecticut, he looked up an engraver, gave him such a sketch of the lay of the land as he could call up from memory, had a plat prepared, and from this plat. without any actual subdivision of the land, sold half of it at public auction for the sum of SSo,000. This within three or four months after paying $5,000. News of this transaction reached Chicago in the course of stage-coach time, but it was generally discredited, until Mr. Hub- . bard returned with the positive confirmation ; and the-well, then, every man who owned a garden patch stood on his head, imagined himself a millionaire, put up the corner lots to fabulous figures, and, what is strange, never could ask enough, which made him mad because he didn't ask more."

William S. Trowbridge, now a resident of Milwau- kee, came West in 1835. He was a land surveyor and, during the excitement, made Chicago his headquarters, surveying lands in the region round about. Early in 1836 he was sent up to survey and plat the city of She- boygan, which embraced a section. Having completed his work he entered for himself an adjoining section in- tending to settle there. On his return he found the ex- citement at fever heat. So soon as it was known that he had secured this claim on suburban property, di- rectly adjoining the city which he had just built on paper, anxious buyers appeared, and in less than one week he had sold out his claim at a profit of $1,500. He immediately returned to Sheboygan and entered another section, adjoining the city on another side, with which he returned to Chicago, and which he readily sold out on better terms than the first. As he stated, he thus continued the business until he had " Sheboygan cor- nered." Out of this peddling of wild land he realized what, to him, then a quiet young man of an unspecula- tive turn of mind, seemed an independent fortune. L'n- like most young men of the time he withdrew with his modest gains, and settled in the town of Milwaukee, where he has since lived the quiet life of moderate affluence which comes to the few whose judgment is not obscured or warped by sudden and unexpected fortune thrust upon them.

A correspondent to the New York Evening Star wrote from Chicago in January, 1837, as follows :

138

HISTORY OF EARLY CHICAGO.

" I am now in a large hotel, in a large city ; for Chicago con- tains a population of 6,000 souls, I have just returned from a stroll to the lake shore, where two years ago I so gladly landed after a long and perilous voyage. 1 can scarcely recognize it as the same spot. Where I then walked over the unbroken prairie, the spacious avenue is now opened, crowded with carts and wagons. and occasionally a showy family rolling and dashing in the hurry of trade or the pomp of native ' sucker,' stumbling, as I do, over bales and boxes on the sidewalks, or gaping at the big signs and four-story brick houses. I am boarding at the United States Hotel, where I pay only two dollars per day for self, and a dollar and a half for horse. There is one noble ship (the ' Julia Palmer') and two others, four brigs, and I know not how many steamboats and schooners, regularly plying hetween this and Buffalo. A lot I was offered for $650 at my first visit (1834) has now upon it a splendid forwarding and commission store, and sold this spring (the naked lot) for $9,000."

From the files of the same paper, May 27, 1837, the following extracts from letters to the Star, written from Chicago, in the fall of 1836, are taken :

" Well, we have arrived at this place, or city that is to be- this nest of emigrants, merchants and speculators-where nearly all the Western towns are hatched, and from which their brood mi- grates to every part of the Union, in the shape of town and village lots. Men make fortunes here in less time than I could box the compass-I say men, for there is a melancholy disproportion of numbers between the sexes. Harry is now suffering under the ef- fects of his dinner parties. He there caught the disease of specu- lation, which I fear will terminate in a collapse of his pocket before he gets back. Strange indeed for one who entered this climate so pure in thought and purpose ; but so it is. He thinks and talks of nothing but emulating the virtues and enterprises of a certain great modern D. D., by hunting up a town site equal to ' Marion City ' ! ! or of the hundred and one great towns at the mouth of Maumee River! ! and selling the lots out to his friends at the East at a profit of $200,000. He seems determined, and wishes me to say that if you will speak well of the place he will name a street after you."

Two items from the Chicago American show the price of real estate when the excitement was at its height. August 15, 1835, it said: "Fractional Block No. 7 sold last June for $1,300; August I it was sold for $1,950. Lot No. I, Block No. 2, sold in June for $5,000, and was resold in August for $10,000. Lot No. 8, in Block No. 16, sold in June for $420, and was re- sold in August for $700." October 17, 1835, the American announced the sale of a lot fronting on Dear- born Street, next the corner of Water, about fifty-five feet deep, for $11,000.

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History of Chicago. From the earliest period to the present time, Part 37

Author: Andreas, Alfred Theodore Publication date: 1884 Publisher: Chicago, A. T. Andreas Number of Pages: 1340

Author: Andreas, Alfred Theodore
Publication date: 1884
Publisher: Chicago, A. T. Andreas
Number of Pages: 1340