The failure of the Fidelity National Bank of Cincinnati was the result of Harper's speculations in the Chicago wheat market. He is reported to have commenced his operations in 1886, the same year in which the bank was organized, and to have used every dollar of the available resources of the bank to support the efforts of himself and those who were associated with him to corner the wheat market.

It appears from the records of the Comptroller's office and the written history of this wheat deal, published at the time, that for several years previously California wheat cargoes had been a dead weight upon the market, and it was understood that some prominent capitalists of that State had secured control of the California supply for the purpose of bulling the market. This fact, and the prospect of a diminished wheat crop together with an active export demand, were regarded as a favorable time for a successful bull campaign. Harper and his associates readily recognized these conditions, and in December, 1886, were reported to have bought thirty million bushels of wheat. But the movement does not appear to have been a success, as the January and February wheat receipts, which were usually light, proved to be unexpectedly full. In consequence, Harper was compelled to dispose of half of his holdings, which left him with fifteen million bushels on hand. During the early part of March of that year other big operators of Chicago made two raids on the market, selling millions of bushels short, all of which were taken up and held by some unknown parties. This, it was stated, was the foundation of the great short interest that was later cornered by Harper and his associates. It was estimated that this short interest in May following amounted to one hundred millions of bushels, and made up what was called, in the parlance of the market, the "shorts" of the Chicago "bears," and the "Farmer shorts," against which an invisible supply was held. In addition to this, all the markets of the country, as well as the foreign operators, were reported as making Chicago the dumping-ground for their short sales.

It was at this period that Harper is reported to have begun his bold movement to corner the market, and in this desperate venture to have staked his individual fortune and all the available resources of the Fidelity National Bank. Who his associates were, never has been definitely known, and it was not even known that he was the head and front of the movement until the corner collapsed. The brokers through whom he operated were well known, but the principals for whom they were operating remained in the background. It was known that large orders were received from brokers in Cincinnati, but it was not known whom they represented.

In the latter part of April, Harper and his associates were reported as having carried about 45,000,000 bushels of May wheat. May was to have been the corner month, but this was found to be impracticable, and it was decided to carry the corner over to June. Thirty million bushels of May wheat were sold and about the same amount of June wheat was bought, and the Harper interests traded the remainder of their May wheat for June wheat, paying, it was said, two and one-half cents a bushel to the brokers for carrying it. The thirty million bushels of June wheat were bought at eighty-two and eighty-four cents per bushel, when June wheat was quoted at ninety-two cents. Early in March it was quoted at eighty cents. The highest price reached was ninety-four and three-quarters cents.

The resources of the Harper combination seemed to be inexhaustible. Their purchases for ten consecutive days were estimated at a million bushels a day. This, added to what they already held, made their total holdings 75,000,000 bushels, and may have exceeded that amount. Harper was reported as employing three million dollars in carrying this wheat.

In March, some Texas capitalists bought about two million bushels of June wheat at eighty cents, which was unloaded on the Harper combination at eighty-five and seven-eighths cents. Up to this time Harper and his associates had made some sweeping operations and were reported as having made considerable money. Many operators who sold short had suffered severely, and the retirement of one large New York house from active business at this time was said to have been due to losses sustained in wheat. In the meantime, the Harper interests continued to buy all the wheat that was offered. Their nerve seemed to be as undaunted as their resources appeared to be inexhaustible.

On June 14 the great corner collapsed. Several causes contributed to this end. It appears that it was the practice for wealthy farmers to sell wheat for delivery in a future month and hold the wheat in their barns against the sale. When there was a corner in the market, this invisible supply was brought forth from numerous localities until all the warehouses and elevators recognized by the board of trade became filled. At this point, those engaged in the cornering of the supply had their firmest hold upon the market. Trains and boats could bring in wheat, but unless this additional grain could be gotten into a recognized warehouse or elevator and duly inspected, it could not be delivered on contract. The supply of cash wheat could only be increased under such conditions by the creation of additional warehouses and elevators and their recognition by the board of trade. This is what happened in Chicago, and was one of the chief causes that brought about the collapse of the Harper corner. The board of trade not only recognized new elevators and warehouses that had been filled with wheat, and declared them to be regular, but it was proposed to make track grain regular also when it was impossible to find storage room.

The stock of contract wheat in Chicago at that time consisted of 15,512,700 bushels No. 2 spring, and 963,268 bushels No. 2 red. If the board of trade had declared track grain regular, the Harper combination would have had to take care of two or three million bushels more, which would have been too great a tax upon its resources. At this time New York operators began to buy December and May wheat in New York and to sell July and

August wheat in Chicago. This movement is said to have weakened the Harper combination and strained its resources to the breaking-point. It was at this critical stage of the situation that Harper is reported to have conceived the scheme of unloading his burden on his broker and then abandoning him, as he was reported to have done several years earlier in his previous dealings in the wheat market. At any rate, the broker having received instructions, placed his celebrated order to buy 5,000,000 bushels at ninety-three cents, and 3,300,000 bushels were sold to him, it was alleged, by Harper's other broker, and when the former discovered the situation, he called his representatives out of the pit and stopped the buying.

Another contributing cause to the collapse of the deal was the fact that several of the New York banks had called the loans to Harper and his associates.

When the market broke it was a tremendous crash. Nothing approaching it had ever been known in Chicago. June wheat broke from ninety-two cents to seventy-two cents, and July wheat from eighty-three and a quarter cents to seventy-four cents. About a dozen or more brokerage houses failed and the entire market was involved in a heavy loss. Harper had staked everything he possessed, his individual wealth, the resources of the Fidelity National Bank, his reputation, and his personal liberty, upon the hazard of a die and lost. All were involved in the success or failure of the greatest wheat speculation that ever was known. He paid the penalty for his misdeeds in connection with the misapplication of the funds of the bank by serving a term in the Ohio penitentiary.