Almost all U.S. citizens know of Black Friday, the day when large retailers offer amazingly generous deals, resulting in malls packed full of oppor-tunistic shoppers; however, “Black Friday” didn’t always refer to a yearly consumer craze, but a gold scandal in 1869 that led our country to the brink of an economic depression.
As a country that had just gone through a civil war, the U.S. was struggling financially; in fact, the Federal Government was $2.8 billion dollars in debt by the time Ulysses S. Grant was elected president. As a result, George Boutwell — the Secretary of Treasury at the time — sold gold at the New York Gold Exchange to help pay it off. At first, this did help — but soon after, disaster struck.
Two conniving speculators, Jay Gould and James Fisk, hatched a plan to exploit the gold market, planting ideas in President Grant’s head that the the gold sales were detrimental to Western farmers. As a result, Grant stopped Boutwell from releasing weekly gold from the Treasury Department, raising its value. Gould and Fisk had simultaneously been buying millions of dollars of gold, further raising this price. Gould’s gold account grew from $10 to $18 million as a result.
When the price of gold exceeded $155 an ounce on September 24, Grant decided to put an end to the scandal, instructing Boutwell to sell $4 million worth of gold and buy $4 million worth of bonds — tanking the value of gold from $160 an ounce to $138 in a matter of minutes. Panic in the Gold Room ensued; stock prices immediately dropped by 20 percent, ruining the careers of numerous speculators, and plunging the United States into a period of financial disrepair.
Black Friday may have gotten its name from the economic use of the word “black,” referring to profitability, since Gould and Fisk had enjoyed large profits up until the economic crash; however, due to the extremely negative results of the day, “black” could simply be a word used to exemplify the dread felt by those involved.
Philadelphia police officers later used the term “Black Friday” in the 1950s to describe the day after Thanksgiving when shoppers — eager to take advantage holiday sales — filled the streets; the cops couldn’t take the day off due to unruly swarms of people, and had to suffer through 12-hour-shifts.
The disgruntled officers began calling this day “Black Friday,” perhaps in cynical reference to the dreaded day of chaos back in 1869. Surprisingly, the term actually began to spread. Retailers hated the negative label, and attempted re-coining it “Big Friday,” to no avail. However, in the end, “Black Friday” was adopted, and retains the same commercial connotations today.