Black Friday (1869)

The Black Friday, September 24, 1869, gold panic was caused by the efforts of two speculators, Jay Gould and his partner James Fisk, (aka The Gold Ring) to corner the gold market on the New York Gold Exchange. The scandal took place during the Presidency of Ulysses S. Grant whose policy was to sell weekly Treasury gold to pay off the national debt, stabilize the dollar, and boost the economy. The country had gone through tremendous upheaval during the Civil War and was not yet fully restored. This period, known as the Gilded Age, was a time of great industrial growth which invited much investment and speculation.

After Abel Corbin, a small time speculator, married Virginia Grant, the younger sister of President Grant, Gould and Fisk approached Corbin, taking advantage of the relationship, and persuaded him to introduce them to Grant with the idea that befriending the President would give them privy information about up and coming government gold sales—information with which they manipulated the market, resulting in the scandals that followed and which undermined the credibility of Grant's presidency and the national economy. Gould and Fisk used their personal appearances with Grant to gain clout on Wall Street.

During the first week of September, Grant's Secretary of Treasury George S. Boutwell suspended Treasury gold sales, after receiving a letter from Grant telling him gold sales would be harmful to Western farmers. At the same time, Gould and Fisk began buying gold at Gould's New York Gold Room raising the price of gold. After learning about the nature of their scheme Grant ordered the release of $4 million in gold on Friday September 24, driving the price of gold down and crushing the Gold Ring's corner on the market. A panic on Wall Street ensued and the country went through a few months of economic turmoil. Thanks to the efforts of Grant, members of his administration and others a national depression was averted. Gould and Fisk, having hired the best defense, and favored by Tweed Ring judges, escaped prosecution. An 1870 government investigation, headed by James A. Garfield, exonerated Grant of any illicit involvement in the conspiracy.

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