ght
in his second term. His Secretary of War, Belknap, confessed to the sale
of offices. In the Treasury Department were uncovered the whiskey frauds
which tainted even Grant's private secretary. And the Speaker of the
House, Blaine, was shown to have urged a railroad company to recognize
his official aid, promising not to be a "deadhead in the enterprise" in
its future service.

There is no better illustration of the commercial ethics of the sixties
than may be found in the letters of Jay Cooke, philanthropist and
financier. With a lively and sincere piety, and an unrestrained
generosity, he at once extended hospitalities to the political leaders
of the day, carried their private speculations on his books, and
performed official services to the Government. It was impossible to tell
where his public service ended and his private emolument began, but
there was nothing in his life of which he was ashamed. A friend of
General Grant, and liberal patron of his children, Cooke was actually
entertaining the President at his country home just outside of
Philadelphia when the failure of his banking house precipitated the
panic of 1873.

There had been financial uneasiness abroad and in the United States for
several months, but few had anticipated the collapse of credit that
followed the suspension of Jay Cooke and Company, September 18, 1873. If
this house failed, none could be regarded as safe. Jay Cooke had
established his reputation during the Civil War through his ability to
find a market for United States bonds. After the war he had carried his
activity and prestige into railways. In 1869 he had become the financial
agent of the Northern Pacific, and customers, encouraged by their good
bargains in the past, continued to invest through him as he directed.
His personal followers, numerous and confident, had been taught to
believe his credit as sound as that of the Government whose bonds he had
handled. When he collapsed, overloaded with Northern Pacific securities,
in which his confidence was enthusiastic, the panic was so acute that
the New York Stock Exchange closed its doors for ten days, to prevent
the ruinous prices that forced sales might have created. Thirty or more
banking houses were drawn down by the crash within forty-eight hours.
Others followed in all the business centers, while trade stood still
through the paralysis of its banking agents.

The distribution of the panic throughout the United States followed t