MILLIONAIRES OF A DAY.

Lyttelton Times, Volume XCIX, Issue 11531, 18 March 1898, Page 2

MILLIONAIRES OF A DAY.

[By Meeriden Howard.]

(Pearson's Magazine.) Between 1885 and 18S8 Southern California was the scene of the biggest land boom that the world has ever seen. There have been booms in other countries —there have been booms in other parts of the United States—but the Californian boom, like its trees and its melons, must needs be the biggest of all. The chief actors were neither ignorant nor poor people. They were nearly all wealthy men, chiefly self-made men of business, from the Western States. Even when their first investments were made they had ample time to revise their judgments, and to weigh their chances. The whole country lay open to inspection. Up to this day you may shoot quail in your neighbour’s orchard, or tramp over his property after jack-rabbits and no one will raise an objection. Moreover, the most foolish speculators were those who prophesied the collapse from the very first and stood by sneering during three-fourths of the excitement, and at the last moment grew tired of watching other people make millions out of nothing, and jumped in with both feet in time to make their own arguments the more conclusive. The beginning of the boom was the knowledge that the bare uplands and lowlands of Southern California could ho converted by irrigation into wonderful gardens and orchards. Year by year the country was being peopled by immigrants such as no other country has ever seen. Instead of in prairie schooners they came in Pullman cars. Chiefly they were wealthy people, or, at least, people with a considerable amount of money, who were in search of relaxation and health. Their first thought was to make their new homes beautiful, and, thus discovering the magic resources of the soil if supplied artificially with water, they promptly converted their waste land into orchards. To these, a,s the news of the country’s productive powers spread, came farmers from the North and East tired of “ vibrating between the fireplace and the wood pile, dodging cyclones and taking quinine.” Until 1885, however, the majority of immigrants came only for the winter, and retreated before the commencement of the summer. But the news was now spreading that the summer months, with their sea breezes and cool nights, were not the less delightful. All through the ensuing summer and autumn, to the surprise of everyone, the steady How of travellers continued. The winter, with its climate of an English June, arrived, and with it, eearlir than usual, the few days of solid rain that converted the rolling hills into emerald and BEJEWELLED THE COAXING GREEN WITH FLOWERS. People came from the East talking of the beautiful fruit that the West was producing. They found land selling for JMO an acre. They found the dry and hare slopes of Riverside that they had known a year before disappearing - beneath the greenery of orchards of which 3000 acres were already bringing the owners more money to the square yard tban any other equal area in the United States. Still more people came and were enraptured. Here were people making profit out of the easiest outdoor work in a climate without its equal iu the world. Once irrigate this magical land, and would it not support the largest population to the aore of any land in the United States ? A deeper curiosity about prices sprang up. In the latter part of Mai'ch, 1886, the fun began. The demand Hist created was for outlying laud around the cities. If there was going to be a sale everyone knew it. During the morning a brass band in gorgeous raiment the streets, followed by a waggon inviting the entire world to a free ride and a free lunch. The idea of getting something for nothing appeals strongly to the American heart. The sales were attended by hundreds of people who had no intention of buying, but merely went for the sake of the ride, the lunch, and the amusement of looking on. Others arrived in smart barouches

and broughams, also merely to look on, and to see how the ex-minister of the Gospel, who was to offieiate, would shape in the auctioneer’s rostrum. A dozen or more assistants were judiciously spread among the crowd, and insured that the bidding was brisk.

In these early days .£4O was considered a good price for a corner lot. The efforts of the ex-minister of the Gospel and his brass band and his dozen assistants generally succeeded in parting with about one-fifth of the property on the spot; after this the sale was continued by means of a map and a blue chalk pencil in the town office of the owner. The ball once set rolling, the demand was generally brisk. If a laxity of interest were shown, however, the owner would forthwith authorise a friend to buy back several lots at a largely advanced rate. The result of this manoeuvre was that there were a certain number of influential people going about the town and informing their friends that they had in the last two days cleared jBIOO or more by buying apiece of land and selling it again. The prospect was so enticing that many people who had no idea of buying land, decided that it would be a direct insult to Providence to throw away such an opportunity of paying their holiday expenses without entailing more trouble than this.

THE DEMAND FOR TOWN LOTS grew greater and greater. Throughout the summer the influx of strangers continually increased. Los Angeles was growing at the rate of 1000 a month; San Diego at the rate of 500. The first thing that strangers heard on their arrival was that the land was booming, and that fortunes were to he had for the asking. It began to he rumoured that California was to be the health and' pleasure resort for the length and breadth of the United States.

Property was selling every day in all directions, and, as a rule, for cash. But it was all good property, prices were not extravagant. Signs of prosperity increased on every side. Pelt sombreros were exchanged for silk hats; pink coral studs gave way to diamonds; the roads were thronged with smart buggies drawn by grand horses with silver-plated harness glistening in the sunshine. But by slow degrees the gambling began. Buyers cared less and less about the solid resources of the land. They were looking for an investment —a chance of making money without work. Farmers commenced to neglect their orchards and to go into townlot speculation. As the fever increased there was no time to produce anything at home; everything from beginning to end was imported. Up to the winter of 1886-7 nearly everything sold as town lots was in the vicinity of cities already established. But now they began all down the coast laying out new cities. Every little rancher had his place surveyed; his orchards and fields began to bear only crops of town-lot stakes.

It was said in the East that the whole of Southern California was cut into 25ft lots. This statement was very little removed from the actual truth. Now that nearly ten years have passed since the boom, farmers still have their surveyors’ maps by them, and bring them out when you call upon them and tell you with melancholy prido WHAT MIGHT HATE BEEN. You look out of the window and see a long stretch of sand and scrub reaching down to the sea, and then you glance at the map and see, at the exact'spot where a seedy cow is now tethered by its bind leg, a cross indicating the church, and this sandy spread all registered as town lots. The dusty trail you have plodded along is officially Myrtle Avenue; parallel to it, where a needy line of pumpkins are now mouldering, is Maddison Avenue. And so the whole property is mapped out.

You can understand that had you been there at the time of the boom and seen this map in some agent’s office, how you might have! hid up for the corner lot facing the depot and the town hall almost without realising that they were buildings of the future and not actually existing. Perhaps that lot adjoining the sea line would* have tempted you; come to think of it, there is no doubt you would have invested a good deal on that. But now you are on the spot you see that this lot, which looks so promising on paper, represents iu reality the actual face of the bluff.

A large number of the lots that were sold would have been found, if the buyers had taken the trouble to visit the property, to be under water at high tide. Perhaps you suggest to your friend the farmer that this looks uncommonly like a. swindle. He points to San Francisco, and twenty other prosperous towns, and tells you that some of the most valuable BUILDINGS ARE CONSTRUCTED ON PILES Besides, what did it matter where the land lay ? North, south, east, or west, in a hole or on a hill, it was all the same to the man who never saw it, never wanted to sea it, and never expected to go near it, but did expect to sell it to someone else in thirty days for twice the price he paid for it. Wherever a surveyor mapped out a town there were found fools to believe that a town would spring up. The success of some of these paper sites was extraordinary. Thousands of acres were purchased at .£lO, .£6, even £2 an acre, and sold, in 25ft lots, the next week for £IOOO and £2OOO an acre. No one seems to have stopped to consider that the actual area of the country that they were cutting up into lots was considerably larger than England and Wales together. The fruit-fanning question was entirely forgotten. In the excitement of mapping out sites for towns,’ the only really valuable part of the Land outside the established business centres ESCAPED THE BOOM ALTOGETHER. At the sale of the merest trash buyers stood in lino all night, and £25, £SO, even £IOO, was often paid for a place in the line the next morning. I For a man to have made £1,000,000 out of nothing was a usual occurrence. “ Capitalist ” was the common designation of everyone. Los Angeles was now growing at the rate of 2000 a month ; San Diego at the rate of 1000. By this time there were more town lots in the market than could have been settled in ten years, if every train that entered the country had been filled with actual settlers. From one end to the other the country side resounded with the noise of brass bands. Prom early in the morning until late at night the sales continued, Sunday being as busy as any other day. The most extraordinary enterprise was shown. A railway station, a club-house, and a bandstand, were erected as advertisements. Special trains brought down their loads of customers, who saw at once the nucleus of a prosperous city, and after having their hearts gladdened by the best of lunches and the coldest of dry champagnes, they were prepared to invest their last farthings on the surrounding land. Dozens of land companies during the first few days of a sale sold'! over £60,000 worth of lots —one-third of this being more than the whole could be worth in twenty years unless turned into fruit land by irrigation. The almost universal plan was to at once erect a hotel about ten times as large as could be filled in the next generation under the most extraordinary circumstances. Twelve thousand pounds was nothing to invest in such an erection. The bands announcing the sales would be followed by a long procession bearing the lumber for the new hotel on one site and the f arniture for the new hotel on another ! In San Diego County alone, Mr Vandyke declares, one-half of the money thus spent on mere conveniences for future tourists would, if put into the development of water and railroads, have made the country THE RICHEST IN THE WORLD. In August, 18S7, the boom was at its height; not a soul, however, suspected it. Coiner lots in visionary towns were now selling at £10,000; £12,000 or £15,000 was often paid, and no one seemed to divine the colossal impossibility of it all.

Gradually a few here and there began to talk of getting out. Millionaires whose money was all invested in land decided that it might he best to have other irons in the fire. Directly the demand ceased prices began to fall In an incredibly short time a reduction of 40 and 50 per cent was being mentioned. The boom that had lasted for two years went off like a Chinese cracker. Money suddenly stopped coming into the country, but millions were still going out to pay for water-pipes, railroad-irons, and cement that had been ordered, and millions more for diamonds and other luxuries that the imaginary millionaire had ordered in the first flush of wealth, and millions more for butter and eggs and pork and other necessaries that the farmers had been too busy speculating to find time to raise. Never was any country so thoroughly, prepared for complete paralysis. That California should have passed through the collapse and is prospering to-day is one of the most surprising facts of its history, _