Two stock manipulators, Jay Gould and Jim Fisk, tried to corner the gold market. They attempted to convince President Grant that the Treasury should not sell gold on the gold exchange. Gould and Fisk spread a rumor to the effect that President Grant agreed.
As a result, gold rose from $132 to $163 per ounce. When the price collapsed, many legitimate brokers went under.
Jay Gould and Jim Fisk made their fortunes speculating on railroad stocks. In September 1869, they began buying up all of the available gold on the market with the hope of cornering the market in gold.
In order to succeed, they needed the cooperation of the U.S. government. Gould and Fisk, therefore, had to convince some government officials not to sell gold on the market. They met with Grant and tried to convince him that it was in the US interest not to sell gold, he listened and said nothing. Thus they were able to spread a rumor that President Grant also agreed that the government should stop selling gold. As a result, gold prices soared to $162 an ounce. When it became clear that Grant was going to order the sale of gold they tried
When, with the approval of President Grant, Secretary of the Treasury George Boutwell ordered the sale of $4,000,000 of gold, the price of gold collapsed, and so did the Gould–Fisk scheme. However, all of the legitimate brokers collapsed as well.