Calumet Hecla Consolidated Copper Co Dated Oct. 29, 1929 - Stock Certificate

Stock printed by American Bank Note Company. Dated the day of the "Stock Market Crash". Rare!

The Calumet and Hecla Mining Company was a major copper-mining company based within Michigan's Copper Country. In the 19th century, the company paid out more than $72 million in shareholder dividends, more than any other mining company in the United States during that period.

In 1864, Edwin J. Hulbert discovered a copper-bearing section of what became known as the Calumet Conglomerate of Precambrian age. The find was in Houghton County, Michigan, between the rich Cliff mine to the northeast, and the copper mines of Portage Lake to the southwest, but a long way from either. Hulbert formed the Hulbert Mining Company in 1864 to acquire the land rights, before creating the Calumet Company in 1865, with Boston investors. The company spun off the Hecla Company the following year, and assigned shares in the new company to Calumet shareholders.

Hulbert was a major shareholder in both companies, and was in charge of mine operations. But despite the rich ore, Hulbert did not have the practical knowledge to dig out the ore, crush it, and concentrate it. Frustrated with Hulbert’s lack of success, the company sent Alexander Agassiz, son of famous geologist Louis Agassiz, to Michigan to run the mine.

Under Agassiz’ expert management, the Hecla company paid its first dividend in 1868, and the Calumet company began paying dividends in 1869. The two companies merged in May 1871 to form the Calumet & Hecla Mining Company, with Quincy Adams Shaw as its first president. In August of that year, Shaw retired to the board of directors and Agassiz became president, a position he held until his death. The town of Red Jacket (now named Calumet) formed next to the mine.

Calumet and Hecla built itself into a copper mining colossus. From 1868 through 1886, it was the leading copper producer in the United States, and from 1869 through 1876, the leading copper producer in the world. From 1871 through 1880, Calumet and Hecla turned out more than half the copper produced in the United States. In each year save one between 1870 and 1901, Calumet and Hecla made most of the copper produced in the Michigan copper district.

By 1901 the underground mining complex had 16 shafts. The company operated a large ore treatment facility at Lake Linden, Michigan. The first smelter was built at Hancock, Michigan, but in 1887, the company moved its smelting to the new smelter at Lake Linden. The company later built a second smelter at Buffalo, New York, which took advantage of the cheap electricity generated from Niagara Falls to electrolytically refine copper. The Buffalo Smelting Works was listed on the National Register of Historic Places in 2011. Electrolytic refining had the advantage that it separated out the silver from the copper.

By 1897, the Calumet & Hecla's Red Jacket shaft had reached a vertical depth of 4,900 feet, making it the deepest mine in the world. The neighboring Tamarack mine became the world's deepest mine for some years; it was bought by Calumet & Hecla, and became part of the Calumet & Hecla system. The Tamarack/C&H remained the world's deepest mine until about 1915, when its vertical depth of 5,500 feet was exceeded by the 5,824-foot depth of the Morro Velho gold mine in Brazil.

Annual copper production from the mines peaked in 1906 at 100 million pounds (45,000 metric tons), then declined to 67 million pounds (30,000 metric tons) by 1912 in response to lower prices. Output dropped to 46 million pounds (21,000 metric tons) of refined copper in the strike year of 1913, but rebounded due to high copper prices during World War I to 77 million pounds (35,000 metric tons) in 1917. The boost in production was attained partly by purchase of the Tamarack Mining Company in 1917. But copper prices fell drastically after the war, and in 1921 copper production fell to 15 million pounds (6,800 metric tons) as the company shut the Osceola (amygdaloid) mine in 1920, and shut down mining on the Calumet conglomerate in April 1921.

Copper production rebounded in 1922, and rose steadily through the 1920s. Calumet and Hecla grew in the 1920s by buying and merging with neighboring copper mines. In 1923, Calumet and Hecla merged with the Ahmeek, Allouez, and Centennial mining companies. The combined entity was renamed the Calumet and Hecla Consolidated Copper Company. The merged company essentially controlled all the operating copper mines north of Hancock, Michigan.

The company had always disposed of the mill tailings (locally called stamp sands) in lakes adjacent to the mills, but about 1900 began investigating methods to recover the copper remaining in the waste tailings. Beginning in 1915, C&H began reprocessing the stamp sands at Lake Linden, using a finer grind and ammonia leaching. Once the process proved profitable, the Tamarack mill also began reprocessing tailings. Through 1949, the company had recovered 535 million pounds (243,000 metric tons) of copper by reprocessing tailings. One of the dredges used, Calumet and Hecla Dredge Number One, is currently sunk in shallow water in Torch Lake.

By 1902, Calumet and Hecla had 5,000 employees, and the towns of Calumet (then named Red Jacket), Laurium, and Lake Linden were virtual company towns. The mining superintendents (called “captains”) were traditionally Cornishmen; the workers were Finns, Poles, Italians, Irish, and other immigrant nationalities.

Historian Larry Lankton wrote that Calumet and Hecla's success resulted in increased benefits that "trickled down" to workers. This made the company the preferred employer, and it generally had its pick of the best workers. Lankton also noted that the company was willing, when necessary to "control labor management relations", to use "coercion, covert manipulation, armed deputy sheriffs, or mass firings.

Calumet & Hecla strived to create ideal communities around its mines and mills, in the hope that pleasant living conditions would help the company maintain a loyal and productive workforce. Historian Lankton wrote that In an era and an industry known for hard working conditions, the Michigan copper companies treated their employees better than most: “… they remained known for being among the most enlightened, fair, humane, and paternalistic employers in the American mining industry.” Some credited Calumet & Hecla, as the district’s leading company, for setting the pattern of improved living conditions followed by the others.

In 1868 C&H built the first industrial hospital in the United States. In 1877 Calumet and Hecla started an employee aid fund to aid ill and injured employees. Participation was voluntary. Each participating worker contributed 50 cents per week, which the company matched. Some writers credit C&H with being one of the first, or even the first, American company to set up an employee health benefits fund. Other Michigan copper companies ran employee aid funds, but C&H was the only Michigan copper mining company to match contributions.

By 1908, the company provided a staff of physicians and its hospital for employees and their families, worker clubhouses with bowling alleys; and employee libraries with reading material in 20 languages. The company also contributed to construction of schools and churches in the community. When the company supplied consumer goods to employees, it used its buying power to provide coal, firewood, and electricity for its tenants at wholesale prices.

Its treatment of employees brought praise from outside the Copper Country. A writer for Harper’s Magazine visited a number of iron and copper mines of upper Michigan in 1882, but singled out Calumet & Hecla’s labor policies for particular praise. He wrote: “But the Calumet Company have no reason to fear strikes among any portion of their force.” In 1898, the Michigan Commissioner of Mineral Statistics enthused: “No mining company in the world treats its employees better than Calumet & Hecla.” In 1916 the Arizona Bureau of Mines wrote of Calumet & Hecla, which had no operations in Arizona: “Probably no mining company in the country has paid more attention to welfare work than has the Calumet & Hecla Mining Company, and its subsidiaries, in the upper Michigan peninsula.” The Arizona Bureau of Mines followed with more than a page detailing the employee benefits at C&H in Michigan.

But Calumet & Hecla, like the other mining companies in the Copper Country, was accused of paternalism. The charge of paternalism was not disputed by those in favor of C&H, who even embraced the term, and saw it as the policy of enlightened capitalism. Company paternalism was most evident in company housing. C&H built hundreds of company houses, and provided them to married employees at low rents that left no room for any company profit. The company also allowed employees to build about a thousand houses on rented C&H land, but under terms by which the company could force them to vacate their houses on short notice. Whether in rented company housing, or their own houses located on rented company land, the employees and their families were dependent on the continued good will of the company for the literal roof over their heads. The provision of housing to favored employees also fostered jealousies among those not so favored. Although continued employment with C&H was required for occupancy of company housing, Calumet and Hecla, unlike the Quincy and Copper Range companies, did not evict strikers during the 1913-1914 strike.

In July 1913, the Western Federation of Miners called a general strike against all mines in the Michigan Copper Country. Hundreds of strikers surrounded the Calumet and Hecla mine shafts to prevent others from reporting to work. All Calumet and Hecla mines shut down during the Copper Country Strike of 1913–1914, although the workers were said to be sharply divided on the strike question. The union demanded an 8-hour day, a minimum wage of $3 per day, an end to use of the one-man pneumatic drill, and that the companies recognize it as the employees’ representative.

Although Calumet & Hecla paid high wages by Copper Country standards, at the time of the 1913 strike, C&H wages were lower, and labor hours longer, than at the unionized copper mines of Butte, Montana. After the strike started, the mining companies maintained that it had already been considering a reduction of the work day to eight hours. The company maintained that the lower wages were more than made up by the lower cost of living compared to Butte.

The US Department of Labor report on the strike noted: “The employees of the Calumet & Hecla Co. were better satisfied than those of any other company, and therefore a much smaller proportion of them joined the federation.” Fewer C&H employees joined the strike than employees of other mines, and more employees of C&H returned to work than employees of other companies, after the Michigan National Guard arrived on the scene.

The mines reopened under National Guard protection, and many went back to work. The companies instituted the 8-hour day, but refused to set a $3 per day minimum wage, refused to abandon the one-man drill, and especially refused to employ Western Federation of Miners members.

On Christmas Eve 1913, the Western Federation of Miners organized a party for strikers and their families at the Italian Benevolent Society hall in Calumet. The hall was packed with between 400 and 500 people when someone shouted “fire.” There was no fire, but 73 people, 62 of them children, were crushed to death trying to escape. This became known as the Italian Hall Disaster. The strikers held out until April 1914, but then gave up the strike.

Calumet and Hecla employees were not again unionized until 1943, when the company signed an agreement with the CIO-affiliated International Union of Mine, Mill, and Smelter Workers.

During the Great Depression, copper prices dropped, and as a result most copper mines in the Copper Country closed, including Calumet and Hecla. Many mines reopened during World War II, when wartime demand raised the price of copper. After the war copper prices plummeted, and most copper mines closed almost immediately. However, Calumet and Hecla was able to stay afloat due to C&H’s practice of acquiring many of the formerly great mines in the Keweenaw during and before the depression, and as a result outlasted nearly all other mining companies.

The company branched into other minerals after World War II. C&H geologists drilled into a major lead-zinc ore body in Lafayette County in southern Wisconsin in 1947. Ore minerals were galena, sphalerite, calcite, and marcasite. The mine, named the Calumet & Hecla mine, opened in 1949. C&H sold the mine to the Eagle-Picher Company in 1954. The company also diversified into copper-based products, including a copper tube manufacturing business and fertilizers.

Calumet and Hecla opened the Kingston mine in 1965, the first new native copper mine opened in more than 30 years. By 1967, the company was operating six mines in the region. However, the company by this point was not even able to produce enough copper for its internal uses. Universal Oil Products (U.O.P.) bought Calumet and Hecla in April 1968. But in August of that same year the more than one thousand Calumet and Hecla employees went on strike. The last of its copper mines shut down, and as labor and management were unable to agree, the company shut down the dewatering pumps in 1970. The mines have remained idle ever since, and most are permanently capped.

Today, many Calumet and Hecla company mines and buildings are part of Keweenaw National Historical Park.

Folksinger Woody Guthrie wrote and sang 1913 Massacre, a song about the Italian Hall disaster. His son Arlo Guthrie also recorded the song.

The Wall Street Crash of 1929, also known as the Great Crash, was a major American stock market crash that occurred in the autumn of 1929. It started in September and ended late in October, when share prices on the New York Stock Exchange collapsed.

It was the most devastating stock market crash in the history of the United States, when taking into consideration the full extent and duration of its aftereffects. The Great Crash is associated with October 29, 1929, called Black Tuesday, the day after the largest sell-off of shares in U.S. history. The crash, which followed the London Stock Exchange's crash of September, signaled the beginning of the Great Depression.

The "Roaring Twenties", the decade following World War I that led to the crash, was a time of wealth and excess. Building on post-war optimism, rural Americans migrated to the cities in vast numbers throughout the decade with the hopes of finding a more prosperous life in the ever-growing expansion of America's industrial sector.

Despite the inherent risk of speculation, it was widely believed that the stock market would continue to rise forever: on March 25, 1929, after the Federal Reserve warned of excessive speculation, a small crash occurred as investors started to sell stocks at a rapid pace, exposing the market's shaky foundation. Two days later, banker Charles E. Mitchell announced that his company, the National City Bank, would provide $25 million in credit to stop the market's slide. Mitchell's move brought a temporary halt to the financial crisis, and call money declined from 20 to 8 percent. However, the American economy showed ominous signs of trouble: steel production declined, construction was sluggish, automobile sales went down, and consumers were building up high debts because of easy credit.

Despite all the economic warning signs and the market breaks in March and May 1929, stocks resumed their advance in June and the gains continued almost unabated until early September 1929 (the Dow Jones average gained more than 20% between June and September). The market had been on a nine-year run that saw the Dow Jones Industrial Average increase in value tenfold, peaking at 381.17 on September 3, 1929. Shortly before the crash, economist Irving Fisher famously proclaimed "Stock prices have reached what looks like a permanently high plateau." The optimism and the financial gains of the great bull market were shaken after a well-publicized early September prediction from financial expert Roger Babson that "a crash is coming, and it may be terrific". The initial September decline was thus called the "Babson Break" in the press. That was the start of the Great Crash, but until the severe phase of the crash in October, many investors regarded the September "Babson Break" as a "healthy correction" and buying opportunity.

On September 20, the London Stock Exchange crashed when top British investor Clarence Hatry and many of his associates were jailed for fraud and forgery. The London crash greatly weakened the optimism of American investment in markets overseas: in the days leading up to the crash, the market was severely unstable. Periods of selling and high volumes were interspersed with brief periods of rising prices and recovery.

Selling intensified in mid-October. On October 24, "Black Thursday", the market lost 11 percent of its value at the opening bell on very heavy trading. The huge volume meant that the report of prices on the ticker tape in brokerage offices around the nation was hours late, and so investors had no idea what most stocks were trading for. Several leading Wall Street bankers met to find a solution to the panic and chaos on the trading floor. The meeting included Thomas W. Lamont, acting head of Morgan Bank; Albert Wiggin, head of the Chase National Bank; and Charles E. Mitchell, president of the National City Bank of New York. They chose Richard Whitney, vice president of the Exchange, to act on their behalf.

With the bankers' financial resources behind him, Whitney placed a bid to purchase 25,000 shares of U.S. Steel at $205 per share, a price well above the current market. As traders watched, Whitney then placed similar bids on other "blue chip" stocks. The tactic was similar to one that had ended the Panic of 1907 and succeeded in halting the slide. The Dow Jones Industrial Average recovered, closing with it down only 6.38 points for the day.

On October 28, "Black Monday", more investors facing margin calls decided to get out of the market, and the slide continued with a record loss in the Dow for the day of 38.33 points, or 12.82%.

On October 29, 1929, Black Tuesday hit Wall Street as investors traded some 16 million shares on the New York Stock Exchange in a single day. Billions of dollars were lost, wiping out thousands of investors. The next day, the panic selling reached its peak with some stocks having no buyers at any price. The Dow lost an additional 30.57 points, or 11.73%, for a total drop of 23% in two days.

On October 29, William C. Durant joined with members of the Rockefeller family and other financial giants to buy large quantities of stocks to demonstrate to the public their confidence in the market, but their efforts failed to stop the large decline in prices. The massive volume of stocks traded that day made the ticker continue to run until about 7:45 p.m.

After a one-day recovery on October 30, when the Dow regained 28.40 points, or 12.34%, to close at 258.47, the market continued to fall, arriving at an interim bottom on November 13, 1929, with the Dow closing at 198.60. The market then recovered for several months, starting on November 14, with the Dow gaining 18.59 points to close at 217.28, and reaching a secondary closing peak (bear market rally) of 294.07 on April 17, 1930. The Dow then embarked on another, much longer, steady slide from April 1930 to July 8, 1932, when it closed at 41.22, its lowest level of the 20th century, concluding an 89.2% loss for the index in less than three years.

Beginning on March 15, 1933, and continuing through the rest of the 1930s, the Dow began to slowly regain the ground it had lost. The largest percentage increases of the Dow Jones occurred during the early and mid-1930s. In late 1937, there was a sharp dip in the stock market, but prices held well above the 1932 lows. The Dow Jones did not return to the peak closing of September 3, 1929, until November 23, 1954.

In 1932, the Pecora Commission was established by the U.S. Senate to study the causes of the crash. The following year, the U.S. Congress passed the Glass–Steagall Act mandating a separation between commercial banks, which take deposits and extend loans, and investment banks, which underwrite, issue, and distribute stocks, bonds, and other securities.

After, stock markets around the world instituted measures to suspend trading in the event of rapid declines, claiming that the measures would prevent such panic sales. However, the one-day crash of Black Monday, October 19, 1987, when the Dow Jones Industrial Average fell 22.6%, as well as Black Monday of March 16, 2020 (−12.9%), were worse in percentage terms than any single day of the 1929 crash (although the combined 25% decline of October 28–29, 1929 was larger than that of October 19, 1987, and remains the worst two-day decline as of February 2021).

The American mobilization for World War II at the end of 1941 moved approximately ten million people out of the civilian labor force and into the war. World War II had a dramatic effect on many parts of the economy and may have hastened the end of the Great Depression in the United States. Government-financed capital spending accounted for only 5 percent of the annual U.S. investment in industrial capital in 1940; by 1943, the government accounted for 67 percent of U.S. capital investment.

The crash followed a speculative boom that had taken hold in the late 1920s. During the latter half of the 1920s, steel production, building construction, retail turnover, automobiles registered, and even railway receipts advanced from record to record. The combined net profits of 536 manufacturing and trading companies showed an increase, in the first six months of 1929, of 36.6% over 1928, itself a record half-year. Iron and steel led the way with doubled gains. Such figures set up a crescendo of stock-exchange speculation that led hundreds of thousands of Americans to invest heavily in the stock market. A significant number of them were borrowing money to buy more stocks. By August 1929, brokers were routinely lending small investors more than two-thirds of the face value of the stocks they were buying. Over $8.5 billion was out on loan, more than the entire amount of currency circulating in the U.S. at the time.

The rising share prices encouraged more people to invest, hoping the share prices would rise further. Speculation thus fueled further rises and created an economic bubble. Because of margin buying, investors stood to lose large sums of money if the market turned down—or even failed to advance quickly enough. The average price to earnings ratio of S&P Composite stocks was 32.6 in September 1929, clearly above historical norms. According to economist John Kenneth Galbraith, this exuberance also resulted in a large number of people placing their savings and money in leverage investment products like Goldman Sachs' "Blue Ridge trust" and "Shenandoah trust". These too crashed in 1929, resulting in losses to banks of $475 billion in 2010 dollars ($556.91 billion in 2019).

Good harvests had built up a mass of 250 million bushels of wheat to be "carried over" when 1929 opened. By May there was also a winter-wheat crop of 560 million bushels ready for harvest in the Mississippi Valley. This oversupply caused a drop in wheat prices so heavy that the net incomes of the farming population from wheat were threatened with extinction. Stock markets are always sensitive to the future state of commodity markets, and the slump in Wall Street predicted for May by Sir George Paish arrived on time. In June 1929, the position was saved by a severe drought in the Dakotas and the Canadian West, plus unfavorable seed times in Argentina and eastern Australia. The oversupply was now wanted to fill the gaps in the 1929 world wheat production. From 97¢ per bushel in May, the price of wheat rose to $1.49 in July. When it was seen that at this figure American farmers would get more for their crop than for that of 1928, stocks went up again.

In August, the wheat price fell when France and Italy were bragging about a magnificent harvest, and the situation in Australia improved. That sent a shiver through Wall Street and stock prices quickly dropped, but word of cheap stocks brought a fresh rush of "stags", amateur speculators, and investors. Congress voted for a $100 million relief package for the farmers, hoping to stabilize wheat prices. By October though, the price had fallen to $1.31 per bushel.

Other important economic barometers were also slowing or even falling by mid-1929, including car sales, house sales, and steel production. The falling commodity and industrial production may have dented even American self-confidence, and the stock market peaked on September 3 at 381.17 just after Labor Day, then started to falter after Roger Babson issued his prescient "market crash" forecast. By the end of September, the market was down 10% from the peak (the "Babson Break"). Selling intensified in early and mid-October, with sharp down days punctuated by a few up days. Panic selling on huge volume started the week of October 21 and intensified and culminated on October 24, the 28th, and especially the 29th ("Black Tuesday").

Together, the 1929 stock market crash and the Great Depression formed the largest financial crisis of the 20th century. The panic of October 1929 has come to serve as a symbol of the economic contraction that gripped the world during the next decade. The falls in share prices on October 24 and 29, 1929 were practically instantaneous in all financial markets, except Japan.

The Wall Street Crash had a major impact on the U.S. and world economy, and it has been the source of intense academic historical, economic, and political debate from its aftermath until the present day. Some people believed that abuses by utility holding companies contributed to the Wall Street Crash of 1929 and the Depression that followed. Many people blamed the crash on commercial banks that were too eager to put deposits at risk on the stock market.

In 1930, 1,352 banks held more than $853 million in deposits; in 1931, one year later, 2,294 banks failed with nearly $1.7 billion in deposits. Many businesses failed (28,285 failures and a daily rate of 133 in 1931).

The 1929 crash brought the Roaring Twenties to a halt. As tentatively expressed by economic historian Charles P. Kindleberger, in 1929, there was no lender of last resort effectively present, which, if it had existed and been properly exercised, would have been key in shortening the business slowdown that normally follows financial crises. The crash instigated widespread and long-lasting consequences for the United States. Historians still debate whether the 1929 crash sparked the Great Depression or if it merely coincided with the bursting of a loose credit-inspired economic bubble. Only 16% of American households were invested in the stock market within the United States during the period leading up to this depression, suggesting that the crash carried somewhat less of a weight in causing it.

However, the psychological effects of the crash reverberated across the nation as businesses became aware of the difficulties in securing capital market investments for new projects and expansions. Business uncertainty naturally affects job security for employees, and as the American worker (the consumer) faced uncertainty with regards to income, naturally the propensity to consume declined. The decline in stock prices caused bankruptcies and severe macroeconomic difficulties, including contraction of credit, business closures, firing of workers, bank failures, decline of the money supply, and other economically depressing events.

The resultant rise of mass unemployment is seen as a result of the crash, although the crash is by no means the sole event that contributed to the depression. The Wall Street Crash is usually seen as having the greatest impact on the events that followed and therefore is widely regarded as signaling the downward economic slide that initiated the Great Depression. True or not, the consequences were dire for almost everybody. Most academic experts agree on one aspect of the crash: It wiped out billions of dollars of wealth in one day, and this immediately depressed consumer buying.

The failure set off a worldwide run on US gold deposits (i.e. the dollar) and forced the Federal Reserve to raise interest rates into the slump. Some 4,000 banks and other lenders ultimately failed. Also, the uptick rule, which allowed short selling only when the last tick in a stock's price was positive, was implemented after the 1929 market crash to prevent short sellers from driving the price of a stock down in a bear raid.

The stock market crash of October 1929 led directly to the Great Depression in Europe. When stocks plummeted on the New York Stock Exchange, the world noticed immediately. Although financial leaders in the United Kingdom, as in the United States, vastly underestimated the extent of the crisis that ensued, it soon became clear that the world's economies were more interconnected than ever. The effects of the disruption to the global system of financing, trade, and production and the subsequent meltdown of the American economy were soon felt throughout Europe.

In 1930 and 1931, in particular, unemployed workers went on strike, demonstrated in public, and otherwise took direct action to call public attention to their plight. Within the UK, protests often focused on the so-called means test, which the government had instituted in 1931 to limit the amount of unemployment payments made to individuals and families. For working people, the Means Test seemed an intrusive and insensitive way to deal with the chronic and relentless deprivation caused by the economic crisis. The strikes were met forcefully, with police breaking up protests, arresting demonstrators, and charging them with crimes related to the violation of public order.

There is a constant debate among economists and historians as to what role the crash played in subsequent economic, social, and political events. The Economist argued in a 1998 article that the Depression did not start with the stock market crash, nor was it clear at the time of the crash that a depression was starting. They asked, "Can a very serious Stock Exchange collapse produce a serious setback to industry when industrial production is for the most part in a healthy and balanced condition?" They argued that there must be some setback, but there was not yet sufficient evidence to prove that it would be long or would necessarily produce a general industrial depression.

However, The Economist also cautioned that some bank failures were also to be expected and some banks may not have had any reserves left for financing commercial and industrial enterprises. It concluded that the position of the banks was the key to the situation, but what was going to happen could not have been foreseen.

Milton Friedman's A Monetary History of the United States, co-written with Anna Schwartz, argues that what made the "great contraction" so severe was not the downturn in the business cycle, protectionism, or the 1929 stock market crash in themselves but the collapse of the banking system during three waves of panics from 1930 to 1933.

Read More

Read Less