Bernard Baruch smelled the 1929 crash coming and told Will Rogers to sell
By 1927 Bernard Baruch, already rich twice over from Wall Street, suspected the boom could not last. He quietly moved into bonds, cash and gold, refused to help prop up falling prices in September 1929, and warned the humorist Will Rogers, who later told him he had saved his life.
Born on August 19, 1870, in Camden, South Carolina, Baruch was the second of four sons in a Jewish family; his father Simon had been a Confederate surgeon. The family moved to New York when he was 10, and at 14 he entered the City College of New York. After working his way up to partner at A.A. Housman and Company, he paid 19,000 dollars for a seat on the New York Stock Exchange and made a fortune before turning 30, speculating on Hawaii's sugar boom. He also founded the Intercontinental Rubber Company with partners including John D. Rockefeller Jr. and Daniel Guggenheim. Running his own firm by 1903 and refusing to join any big house, he became known as the Lone Wolf of Wall Street.
His doubts in the late 1920s had roots in losses from the collapse of Florida's property bubble and unease at the Federal Reserve's rate cuts in summer 1927. A popular tale says a shoeshine boy's stock tips spooked him; Baruch's own version involved a beggar offering advice near the peak, by which time he had already cut back.
Public service defined his later life. He left Wall Street in 1916 to advise Woodrow Wilson, and in January 1918 took charge of the new War Industries Board, coordinating raw materials, factories and distribution for the American war effort, work that won him the Army Distinguished Service Medal. At the 1919 Paris Peace Conference he opposed the reparations France and Britain demanded of Germany and backed Wilson's League of Nations.
Through the interwar years he urged readiness for another war, and in the Second World War he advised Franklin D. Roosevelt on industrial supply, credited with sharply cutting the time needed to build tanks and aircraft, and helped design rehabilitation programmes for wounded servicemen. In 1946, as American delegate to the United Nations Atomic Energy Commission, he proposed international control of atomic energy, a scheme the Soviet Union rejected. He died on June 20, 1965.
Source: Bernard Baruch
