Bear v. Bear

In the boom days of 1928 a stock called Alaska Juneau sold for $1 a share and this year it has sold for $20. It is, of course, a gold-mining stock--the one kind of stock which Bears can logically be bullish on-- for when everything else goes down, gold becomes more valuable. Last week Wall Street brokers had a tall tale to tell of a fight among the bears which centred on Alaska Juneau and made it the most exciting stock on the Exchange.

Bears? Bears? They are referred to daily in every financial paper. But who are the bears? Who are the men who have (so rightly) believed that stocks would go down and who have consequently sold short and sold again? Their names are rarely mentioned, for while it is eminently reputable (though sometimes painful) to be called a Big Bull, it is not nice to be labeled, out in public, Bear.

Two, who have emerged from anonymity because of the size of their operations and the reputed size of the fortunes they have made by selling short, are William ("Bad Bill") Danforth and Bernard ("Big Ben") Smith. Last week's tall tale had it that Bear Danforth had decided to turn Bull; had decided to buy Can, Steel and other leaders; and believed, moreover, that his fellow Big Bears concurred in his change of financial heart. But Bear Smith, it appeared, had concurred in no such thing. So, while Bear-turned-Bull Danforth bought, Bear-still-Bear Smith sold. Mr. Danforth was extremely annoyed. To get back at Mr. Smith, the best thing Mr. Danforth could do was to sell Alaska Juneau, and he did and he did. And that, said brokers, is why Alaska Juneau went down from $20 to $13 while little bears crowded round the post and wondered bitterly why. . . .

"Bad Bill" Danforth's rightful lair is in Boston. Even before 1929 fortune made several spectacular visits to him, tarried and vanished. The first market break found him in a good cash position and he exuberantly began "selling the list," and he sold time and again. Soon the Danforth legend began to grow (TIME, Oct. 28, 1929). His tall, lean figure became familiar in the inner sanctums of Manhattan's speculating circles. Indian-like in appearance, he maintained an Indian's calm, made no tactical blunders. Aged 45, he likes golf, plays at the Westchester Country Club with other big market operators. He likes airplanes, flies about in his Bellanca. Last winter he did not spend much time in his Brookline home (said to contain the biggest & best bedroom in Boston), could usually be seen in the office of M. J. Meehan & Co., Sherry-Netherlands Hotel, Manhattan. Last week he was to all reports still strutting in his new bullskin.

When stocks were going up Bernard E. Smith, floor trader with an office at W. E. Hutton & Co., was a bull. Not until the decline was well under way did he loom as a powerful bear. He is of medium height, fairly heavily built and a little mysterious to all but a few men in Wall Street. He is quiet, says "smack 'em" whenever stocks are mentioned. He has been mentioned as the No. 1 Bear in Case Threshing and is reported to have bet $1,000 that by the end of 1933 Case would sell lower than his pet, Alaska Juneau. At the time their respective prices were $90 and $12. He is supposed often to have been heavily short of Westinghouse and General American Tank Car. Once last winter he appeared unexpectedly, dramatically, on the floor of the Exchange a little before the opening although he was supposed to be in Florida. As soon as trading began he rushed about selling stocks heavily. Then he went back to Florida.

Last year "Smack 'Em Ben" is said to have been asked if he were any relation of David Lamar, onetime "Wolf of Wall Street," manytime a criminal suspect. He is supposed to have laughed, replied, "Sure, I'm the brother-in-law of the Wolf of Wall Street." The New York World telephoned him to ask if this fact was true. He thought it was a joke, said yes. The next morning the World published a story in which it said that Bernard E. Smith was David Lamar's brother-in-law. Within 24 hours this statement was retracted.

At present Bear Smith is thought to be in a fairly neutral position, biding his time.

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