mortgage bonds, including, most of the stock, and, as a pledge of good faith, made Mr. Villard custodian of the deposited values, worth, according to the market quotations, over ten millions of dollars. Notwithstanding this, Gould changed his mind, went back on the bargain, and tried to force the bondholders to submit to his former terms by opening an offensive campaign, in which the St. Louis directors, who had at first stood by the bondholders, now joined him.
In order to frighten the bondholders, he caused the construction of a new line from Cheyenne to Denver, by which he could compel the Kansas Pacific to share its mainstay, the Denver traffic, with the Union Pacific. He made the company apply for the removal of Mr. Villard as receiver, on the ground that he acted partially as the representative of the mortgage-bond interest, and he was successful in this move, as Mr. Villard could not and would not deny that he had favored the bondholders in every possible way, having been appointed their representative. Gould also got the portion of the press which he influenced to heap slander and abuse upon Mr. Villard and the New York committee. But they and the German committees stood firmly together and ordered foreclosure proceedings to be commenced. Gould's ulterior object was, as he had repeatedly avowed to Mr. Villard when he tried to win him over, the consolidation of the Kansas Pacific with the Union Pacific by exchanging stock for stock, and issuing consolidated Kansas Pacific mortgage bonds against the other securities in the pool. As he had bought many millions of Kansas Pacific stock from the St. Louis directors and in the market below 12%, and the Union Pacific stock then ranged in the market between 60 and 70, and as the issue of the new bonds would also yield him a large profit, he played really for a harvest of millions. Upon the setting in of the great boom in Wall Street in 1879 with the approaching resumption of specie payments, Gould saw the great opportunity it offered for floating new secu-
