Of Gold HillSome of the most profitable mining ground was never on the market. It belonged to a closed corporation, usually one man, and it was not for sale–like the twenty feet of L. S. “Sandy” Bowers in Gold Hill. It yielded a total of about one million dollars and gave him a good income, though nothing like the, fantastic $70,000 a month of popular report. Adjoining Bowers was the Plato claim of ten feet, also the property one man. In September, 1863, Plato declared the record dividend of the Territory, $1,335 per foot, a tidy monthly total of $13,350, which the owner did not have to share with any stockholders.Editors remonstrated against witless plunging, and humorists satirized it. One ironist invented imaginary claims called “The Rising Moon,” “It’s All in Your Eye,” “The Captain Kidd,” “The Freeze Out,” “The Nip and Twitch.” Dan De Quille had one of these that he named “The Pewterinctum.” Another wit, in “Advice to a Verdant Stock Operator,” said solemnly:”If I was in your place and thought the Baltic was going up, uld hold on; if I thought it was, going down I would sell. As a general rule in stock operations, buy at the lowest pricesell at the highest; get all you can and keep the money. I have sold my Baltic, and am sorry for it. I have plenty of er stocks on hand, for which I am also sorry… I think the Baltic is a good mine if it only pays dividends. There are two kinds of mines-those that pay dividends and those that require assessments. The dividend-paying mines are generally considered the most desirable to hold.Neither raillery nor serious reproof slowed down maniacal feet-trading in Virginia. All booms induce aberration, but this Washoe performance proceeded with utter disregard for reality. At the time only three mines were paying dividends: Gould & Curry, Ophir, and Savage. Most of the others were levying assessments, and no outside claim had shown any sign of becoming a paying one. Yet the hope of buying into a bonanza obliterated these hard facts and produced behavior as zany as the most hysterical-boom ever saw. The shrewd ones made money, as they usually do; the unskillful, who held on too long, lost their shirts. But that is an old story.The rapid increase of population pouring over the moun- tains from California made new buildings so much in demand that as soon as a foundation went down, the owner put up a sign: “This building is rented.” A shortage of living quarters jammed hotels and lodging houses, skyrocketed the price of real estate, and boosted rents. A good-sized house for a family, or a suite of elegant bachelor rooms, rented for as much as $250 a month; small wooden stores, $300-$500. The owner of a lot with a twenty-nve-foot frontage refused $12,000 for it. High freight rates on furniture and provisions brought over the mountains made the cost of living’about twice that of San Francisco: a home-town economist estimated a minimum of $100 a month for each adult, $30 for every child. Home life was rare, all bachelors and many families sleeping in rented rooms and eating in restaurants, where board at $12 a week was the rule in the few places fit for ladies. But nobody grumbled much about crowding or inflation. The prevailing maxim was: “Go for it while you can.”
C. J. Prescott, was the proprietor of one of the first lumber companies on the Comstock. Sierra Nevada Wood & Lumber Co. They had major contracts to provide lumber to the mines for structural support and was always trying to get a contract with the railroad for struts.
He was eventually bought out by the Four Kings in their vertical monopoly.
Location. 39° 18.18′ N, 119° 39.06′ W. 12 Hickey Street, Virginia City NV 89440, United States of America.
The Comstock Lode in Nevada was and is still the richest mineral discovery in the history of the world. It brought a rare assortment of people to Nevada in the 1860s. Virginia City was the at the heart of the strike.
The Big Four
They came to be known as The Big Four Bonanza Kings. John W. MacKay, James G. Fair, James C. Flood and William O’Brian. Four Irishmen, who would turn the Comstock around, and become the most prominent businessmen on the Comstock.
The term Bonanza Group, together with the names “Big Four” and the “Irish Four,” refers to a group of immigrants who outmaneuvered William Sharon and broke the monopoly of his Bank of California until they controlled much of the Comstock Lode. Two Irish miners, John Mackay and James Fair, with the financial help of James Flood and William O’Brien, San Francisco investors, seized control of Virginia City’s Hale and Norcross Mine in 1869.
The four men then aggressively obtained other claims. In 1873, while exploring the Consolidated Virginia and California Mine, Fair and Mackay discovered an astonishingly rich ore body eventually known as the Big Bonanza. Phenomenal profits made Mackay, who owned two-fifths of the partnership, one of the richest men in the world. He and his associates formed the Bank of Nevada to rival Sharon’s institution.
The Bonanza Group controlled most of the Comstock Lode throughout the rest of the nineteenth century.
Oscar Lewis. Silver Kings: The Lives and Times of Mackay, Fair, Flood, and O’Brien, Lords of the Nevada Comstock Lode. New York: Knopf, 1959.
Ethel Manter. Rocket on the Comstock: The Story of John William Mackay. Caldwell: Caxton Printers, 1950.
John W. MacKay — (1831-1902) came to the U. S. as a young man, landing in California, the mining district attracted him most. It didn’t take him long before he was following the trail with thousands of others to the mines of the Comstock. In 1861 he started out as a miner in the Cook Tunnel for $4 per day. He was often seen hiking up the trail in Six Mile Canyon with a Ames shovel on his shoulder. He went to work in the first shallow diggings on the slopes of Mt. Davidson. He soon became an expert in timbering a mine that he moved on to a timber man position for $6 per day, and then on to superintendent of the Caledonia Tunnel and Mining Company.
In 1861 after saving his hard earned money, he went to Auroa with John Henning and bought the Esmeralda Claim. But this venture turned out to be a failure so MacKay returned to Virginia City and hooked up with J. M. Walker in building the Petaluma Mill at Gold Hill which unlike his venture in Aura, this turned out to be more profitable. It was Mr. Walker that later introduced MacKay to Fair, Flood and O’Brian.
While he was working in the Kentuck Mine in the Gold Hill district, he would take his salary in shares instead of cash. In 1863 the owners of the mine wanted to incorporate, but learned they were not able to do so without ownership of a certain amount of shares that belonged to one of the original discoverers. Unfortunately, this shareholder was reported to be off fighting with the Confederacy in western Tennessee. A large bonus, or reward, was posted for the legal recovery of the shareholders proxy.
MacKay had a plan and for four months he disappeared. When he returned he had the missing block of shares and a bill of sale. The Kentuck Mine could then be incorporated and MacKay found himself for the first time an active capitalist on the basis of his shares. In his earlier days he had remarked that when he made $200,000 he would retire, but success got the best of him and his early retirement plan fell by the weigh side.
James Graham Fair — (1831-1894) came to Virginia City across the Sierras from California in 1860. True to prospecting, it’s said he had a gift of knowing where to find ore. He became superintendent of the Hale & Norcross, and there he developed and took the first big bonanzas from these mines.He was always on shift checking up on the deep shafts and winding tunnels. He would personally check each new find and put a stop to all lagging or listless service. He missed nothing. No one under his supervision escaped due punishment for his own faults. Even in anger, which was often, he remained calm and even voiced.
It wasn’t long before Fair met up with another Irishman who would become his partner on the Comstock. Fair and MacKay had 400 shares between them of the Hale & Norcross by 1869, but the stock soon dropped from $2900 per in March to $41.50 per in September of ’69. This however worked itself into the scheme of Fair and MacKay, for while the stock was low they were able to buy up the controlling interest with the help of two San Francisco saloon proprietors — James Flood — (1826-1889) and William O’Brian — (1833-1881), and together they became the famous Big Four.
In 1864 the Bank of California in San Francisco sent a agent to Virginia City to open one of it’s branches. The agent, William Sharon, had lost his wealth in stocks as a businessman in California. Since he was seeking a new job he accepted the new position.
When Sharon arrived in Virginia City, he was in a sense the materialization of a new order. His keen sense of organization was to have success over confusion along the Comstock.
When Sharon arrived in Virginia City, the local business’ were loaning money to mill owners, and anyone else in the district that needed it, at very high interest rates, ranging from 3% to 4% per month. This was the standard practice among Comstock business’ and the mines.
Sharon opened his offices and immediately offered loans at 2% a month, undermining the competition. This practice, either of good will (doubtful) or of shrewd business (probable), got him into plenty of trouble. For collateral he had been accepting mills and mine plants. Before long he had mortgages on most of the mining properties on the Comstock. Problem being as the mills became numerous the ore going to each operation became less, so the profit margin dropped, forcing some of the mills to shut down placing them in Sharon’s hands.
After he had to foreclose of seventeen, Sharon organized a corporation, The Union Mill and Mining Company. The seven main mills were kept open and busy twenty-four hours a day until the eventually controlled the output of most of the Comstock mines
The Carson river, 16 miles south of Virginia City, supplied the water for the milling works and therefore the majority of the mills were located along the river.
Sharon’s control of the railroad, the mines and the mills gave him great influence in getting bills passed which were favorable to the Bank of California. From his arrival in 1864 until about 1870, Sharon was the Great Bonanza King. Under his dominion at least $150,000,000 was taken from all of the mines in the district.
Although Sharon lost his banking power, he maintained his control of the fifty miles of the V & T RR. It remained a power for him on the Comstock until The Big Four. The railroad had 28 engines that were in constant use and four more were under construction. But John MacKay and his partners were intent to rid the Comstock of Sharon, and since his last interest was in the railroad that’s where they attacked.
At one point they demanded a cut in freight rates for all Comstock miners. The cut was made because MacKay threatened to build another railroad.
To help thwart matters with Sharon’s railroad further, the MacKay interests were shipping their bullion to California via Placerville in huge bullion wagons drawn by teams of horses and mules. A wagon departed every night, with the bullion at 55% gold and 45% silver, they cast the bricks in such a large fashion, highway bandits couldn’t steal it.
In 1874 Sharon had purchased control of the Ophir mine from “Lucky” Baldwin. This boosted stock from about $50 in October to $350 in January when Sharon was elected to the U. S. Senate. Thinking the bonanzas had all been exhausted, he immediately sold his shares in the Ophir, but this caused a panic on the West Coast, and it ruined his associate, W. C. Ralston at the Bank of California in San Francisco.
The Big Four Takeover
The Irish quartet of the Comstock set up a bank in San Francisco and named it the Nevada Bank. It had the largest paid-up-capitol of any bank in the world of $5,000,000. It was created to oppose the California Bank from San Francisco of which William Sharon was the agent. These two banks began to fight each other, but MacKay was no match for Sharon. Sharon made threats against the MacKay forces, saying he would see MacKay walk out of town with his blankets on his back. O’Brian, on the other hand, responded by simply saying he would serve liquor over the counter of the California Bank once it was in their control.
This went on until August 26th, 1875, when the California Bank closed its doors. The cashier in the San Francisco branch went down to the bay for a daily swim and was found later, drowned. The MacKay interests took over all the assets of the Sharon branch and O’Brian, true to his word, had the pleasure of serving a glass of liquor over the bank’s counter. The California Bank was saved from ruin, but never again opposed the Big Four — the new Plunder Barons of the great Comstock.