Name:  Jay Gould

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Born:  May 27, 1836
Died:  December 2, 1892
Complete HarpWeek Biography:
Financier Jay Gould was born Jason Gould in Roxbury, New York, to Mary More Gould and John Gould, a storekeeper and farmer. From childhood, he manifested the intelligence, strong will, practicality, and drive to succeed that would help make him a multi-millionaire businessman in adulthood.

Gould studied at local academies, clerked in his father’s store, and taught himself mathematics and surveying in his leisure time. When 16, he started a land-survey business, and three years later finished writing a history of his home county, A History of Delaware County. In 1856, he joined an experienced tanner to open a tannery in eastern Pennsylvania; the town, Gouldsboro, was named for him. When a second partner committed suicide in 1859, Gould left the tanning business. He moved to New York City where he began speculating in railroad stock, and in 1860 opened a Wall Street brokerage house. In 1863, he wed Helen Day Miller, and Gould became a dedicated family man to his wife and (later) six children.

During the Civil War, Gould traded in government bonds and gold, using his profits after the war to buy and sell railroad companies. He, Jim Fisk, and Daniel Drew, became controlling shareholders in the Erie Railroad Company. In the so-called “Erie War” of 1867-1868, they successfully deflected a hostile takeover effort by Cornelius Vanderbilt, owner of the New York Central Railroad, by flooding the market illegally with 50,000 shares of Erie stock. After Judge George Barnard issued an arrest warrant for their violation of a court injunction, Gould and his cohorts fled across the Hudson River to Jersey City, New Jersey.

The “Erie Ring” soon relocated to Albany, New York, where they brazenly bribed New York state legislators to pass laws making their previous stock issues legal and barring the merger of the Erie and New York Central Railroads. A key element in securing the favorable legislation was convincing William Tweed, boss of the Tammany Hall Democratic political machine and a state senator, to switch sides from Vanderbilt (Judge Barnard was a Tweed lackey) to Gould. After receiving stock, cash payments, and a seat on the Erie Railroad board of directors, Tweed marshaled the legislation through the state assembly.

In 1869, Gould began buying gold, which was currently at a low price, with the aim to sell at the inflated price generated by his cornering of the gold market. To hide his real interest, Gould spread the word that he was acting on the federal government’s behalf, and he used President Ulysses Grant’s brother-in-law, Abel Corbin, to try to dissuade the administration from intervening. Grant, however, ordered Treasury Secretary George Boutwell to release some of the government’s gold reserve in order to lower the skyrocketing price. The move stabilized the gold market, but not before the disaster of “Black Friday” (September 24) on which several businesses and thousands of investors were financially ruined. By that time, though, Gould had already sold his gold at the artificially high price. Together, the “Erie War” and “Black Friday” fixed Gould’s public image as that of a rapacious financial predator.

In 1872, Fisk was shot and killed, the Tweed and Erie Rings were broken, and Gould was removed from his position with the Erie Railroad. For the next two years, he continued trading stock on Wall Street. In 1874, he purchased the Pacific Mail Steamship Company and the Union Pacific Railroad, the latter recently tainted with the Credit Mobilier scandal of graft and influence-peddling. Despite an economic depression, Gould’s management reversed the misfortune of the Union Pacific until he sold his stock in the company in 1878. He began buying other railroads, including the Kansas Pacific, Wabash, Missouri Pacific, smaller railroads, and half-interest in the Denver and Rio Grande, which together created a transcontinental system in potential competition with his former Union Pacific company. Instead, he sold the Kansas Pacific to the Union Pacific and bought another network of railroads in the Southwest, eventually controlling one-half of the railroad-track mileage in that region.

From 1879 to 1883, Gould owned the New York World newspaper. He also became a major investor in the telegraph and mass transit businesses. In 1881, he bought controlling shares in Western Union, which handled most of the nation’s telegraphing, and part-ownership of the Manhattan Elevated Railroad (gaining ownership control in 1886). His management increased the efficiency and profitability of the firms. The financial panic of May 1884, forced him off of Wall Street, but he continued his business interests.

In the mid-1880s, Gould’s health began to decline. He suffered from bouts of facial neuralgia, and in 1888 contracted tuberculosis, which he kept secret from everyone, including his family. In 1890, he surprised many by repurchasing Union Pacific and Pacific Mail. He was deeply grieved by the death of his wife in January 1889. His tuberculosis entered the terminal stage in the fall of 1892, and he died on December 2. His fortune was estimated at $75 million, all of which he left to his family.

Sources consulted: American National Biography; Dictionary of American Biography; William DeGregario, The Complete Book of U.S. Presidents; Walter Licht, Industrializing America: The Nineteenth Century; Oliver Allen, The Tiger: The Rise and Fall of Tammany Hall.











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