|There’s still a piece of Archie Bunker America in East Baltimore.
It’s a neighborhood of about 500 row homes built in the early 1950s to provide cheap housing for the local steel and other manufacturing industries.
At the time, four out of five manufactured products in the U.S. contained steel. And a streetcar running down the main corridor (Eastern Ave.) took residents to the once-powerful Bethlehem Steel.
Each of the row homes was capped with a brick that has a very distinctive orange-ish/copper color every Baltimorean knows. Show this photo to anyone from Charm City, and they’ll know exactly where this neighborhood is located:
Today the neighborhood is crowned with the complimentary name Bayview.
But before the real estate marketers came to town, it was simply called “A to K” — referring to the alphabetical naming of the streets:
Anglesea, Bonsal, Cornwall, Drew, Elrino, Folcroft, Gusryan, Hornel, Imla, Joplin, and Kane.
But it’s just one of these small Baltimore streets I want to point out to you today: Drew St.
Drew is a small, quiet, two-block road that runs straight through Bayview; yet the man this street was named after was anything but small and quiet.
The Man Who Beat Cornelius Vanderbilt… Twice!
Ladies and gentlemen, please let me introduce you to Daniel Drew.
He was one of the slipperiest, slyest, and cleverest investment barons ever to walk down Wall Street.
He lived a real-life Gangs of New York and managed to beat the legendary Cornelius Vanderbilt at his own game… twice!
Daniel Drew was born in 1797 to a cattle drover outside of New York City. When Drew was 15 years old, his father died, and he was forced to take over the cattle business to support the rest of the family.
It was a tragedy that probably shaped Drew into the take-no-prisoner investment baron he became later in life.
As a young man hungry for money to support the family, Drew moved to the city in 1820 and began to operate the famous Bull’s Head Tavern on Bowery St.
Even though the original building was moved, the Bull’s Head was already a landmark by the time Drew began to run the tavern.
George Washington himself established a temporary headquarters there in November 1783 at the end of the Revolutionary War. And it was later owned by local butcher Henry Astor, the patriarch of the Astor dynasty. So the tavern was often frequented by other cattlemen and butchers doing business in New York. It was the Facebook of its time.
Operating the Bull’s Head Tavern gave Drew access to all types of businessmen and allowed him to form partnerships and expand his wealth.
Some time in 1834, Drew stepped into the steamboat business. And that was quite a gamble.
You see, steamboating was controlled by a monopoly owned by the powerful Cornelius Vanderbilt and the Hudson River Steamboat Association. And only few had the balls to stand up to Vanderbilt and his cartel. But Daniel Drew had a plan…
Drew leased a steamboat from the HRSA named the Westchester. And then he began a price war.
Initially, fare on the Westchester and other steamboats was $2 (about $50 today). But Drew cut the Westchester’s fare in half to $1 in an apparent attempt to steal customers from other boats.
In response, Vanderbilt’s HRSA steamboats also cut their fares to $1. And the two continued going back and forth, lowering prices all the way down to $0.10.
By November 1834, steamboat fare was completely free. Operators made money by selling passengers food and drink — which was, of course, substantially increased in price.
In the wake of the price war, Vanderbilt agreed to sell the Westchester steamboat outright to Drew. And why not? Vanderbilt wasn’t making as much money with the price war going on.
Want to take a guess what Drew did after he owned the Westchester instead of just leasing it?
He jacked its fare back up to $1.
Vanderbilt was pissed. He fell right into Drew’s trap. But there was little Vanderbilt could do. Besides, at the time, Vanderbilt was becoming more involved in railroads, which was clearly the future of passenger transport.
But he wasn’t done dealing with ol’ Daniel Drew just yet.Over the next 20 years, Drew expanded his wealth operating a brokerage firm in New York. And in 1857, he became a member of the board of directors of the Erie Railroad.
Drew used his board position to manipulate the price of Erie stock, and the company eventually faced bankruptcy.
One major shareholder of Erie was particularly displeased about this: Cornelius Vanderbilt.
Nevertheless, Vanderbilt was forced this time to team up with Drew to rescue Erie from bankruptcy. But Vanderbilt had enough of Daniel Drew. It was time for revenge.
Around this time, Drew also became a director of the New York and Harlem Railroad. And again, Drew began trying to manipulate the price of the railroad stock by selling it short.
But Vanderbilt and his associates were ready. They bought every share Drew sold and pushed NYHR stock up from $90 to $285 in five months. Drew lost $500,000… that’s equivalent to over $13 million today.
But Daniel Drew didn’t go down without a fight.
Between 1866 and 1868, Drew conspired with fellow Erie Railroad directors James Fisk and Jay Gould (two other famous Wall Street wolves) to issue stock in an effort to stop Vanderbilt from gaining control of the company.
Vanderbilt was unaware the three were increasing the outstanding shares and kept buying the stock. As a result, Vanderbilt sustained heavy losses and eventually conceded control of Erie to the trio.
Daniel Drew, a roughneck cattle drover, went toe-to-toe with Cornelius Vanderbilt’s steamboat and railroad cartels — the meat and potatoes of the Vanderbilt dynasty — and he ultimately won… twice.
But every great rise seems to always be followed by a great fall.
In 1870, Fisk and Gould betrayed Drew. The two ended up manipulating Erie Railroad stock’s down, costing Drew $1.5 million… over $30 million today.
Then the Panic of 1873 wiped Drew out completely. By 1876, Drew filed for bankruptcy, with debts exceeding $1 million and no viable assets.
In 1879, he died dependent on his son for support.
Summarizing his life, Henry Clews wrote:
Of all the great operators of Wall Street… Daniel Drew furnishes the most remarkable instance of immense and long-continued success, followed by utter failure and hopeless bankruptcy.
The elementary moral of the story here is clear: There’s no honor among thieves.
But I see a much more optimistic truism in the story of Daniel Drew…
America really is the land of opportunity.
An uneducated cattle drover born into very little can rise up to challenge the country’s richest and most powerful… and ultimately win twice. Sure, Drew died broke. But he had one hell of a ride. Much better, I’d say, than a life of cattle droving.
If you live in America, that same opportunity is there for you as well. It’s only a matter of whether you take it.
Are you going to drove the cattle?
Or take the bulls by the horns?