WALL STREET: Mr. Hosford Bows Out

Most Clevelanders have never heard of Clevelander Harry William Hosford. Many a Cleveland financial man who can boast about knowing the big boys has never seen him. A few knew him as the country’s biggest individual speculator in Government securities. In the winter of 1942-43 alone he bought upwards of $28 million worth of Government bonds.

Some estimated his fortune at $75 to $100 million. One thing everybody was sure of: obscure Harry Hosford was one of the town’s richest men. But his name is not in the Directory of Directors, and seldom in a newspaper. Hosford, a lone wolf, cloaked his deals, in secrecy. But there was nothing very secret about his operations in Government bonds.

He was one of the first to discover the marvelous possibilities for profit in the Treasury’s long-standing policy of pricing new issues so favorably that they would soon bring a premium in the market. Since all banks were eager to get more than their allotments of bank-eligible securities, an individual like Hosford could borrow the money to buy as much as $1 million worth on no more collateral than $10,000, sell the bonds at a handsome profit as soon as they rose. For example, if a $100 par bond rose to $100⅜, the $10,000 could bring a profit of $3,750.

Shaggy Dog. But last week, word leaked out that Hosford was just about out of the market. He had quit speculating in Government bonds because the high capital-gains tax made it scarcely worth while. TIME’S Cleveland correspondent, who called at Hosford’s big stone suburban home, found him in shorts by his swimming pool, sipping a tall drink which he hated to see either full or empty, and talking to a shaggy English sheep dog as if he half expected the dog to answer. To his visitor, Hosford related some of the facts of his fabulous career.

Born in 1886 on a New York farm, Hosford became a Western Union messenger at 12, then worked on Great Lakes freighters for seven years. At 22, he became a $100-a-month bond salesman in Cleveland; in 1916 he went into investment banking for himself. He made his first killing in 1921, buying up depressed Liberty Bonds. Traders first began to notice him when he became a big buyer of Canadian bonds. In the bull market of the ’20s, he loaded up heavily with Woolworth and Montgomery Ward when they were low-priced, made millions when they spiraled and were split. One of the few to unload before the 1929 crash, he doubled his fortune by going short.

Bottoms Up. Shy, almost inarticulate with strangers, Hosford seldom leaves home except to go on summer cruises on lake freighters, whose captains are almost his only close friends. He sometimes brings the skippers home for sessions of story swapping during which he makes them drink straight whiskey by the tumbler.

The only time he ever made a public appearance was last year, when, at the urging of a friend, he gave the Cleveland Heights High School $100,000 for a stadium. The friend wrote him a speech for the presentation, but when it came time to deliver it Hosford merely mumbled: “I’ve decided to give you a hundred thousand,” and sat down.

Explaining his retirement from speculating in “Governments,” Hosford said: “If you went to a gambling joint and they posted odds showing 85% in favor of the house, you wouldn’t play, would you?”