More History of the Crookedest Short Line in America
by Roger Colton

May 5, 2000

The term "crookedest railroad in the world" refers more to the politics and
sneaky business practices of the Bank of California than it does to the
route of the railroad. The following information is taken from the book
"Ralston's Ring" by George D. Lyman, 1937.

In 1864, William Sharon thought he was poised on the edge of untold wealth.
He was buying shares in the North America mine -- rumored to be close to the
bonanza in the adjoining Overman mine. He owned 1000 shares of the North
American and wanted complete control of the mine. In the rush to buy more
shares, he actually bought 1700 shares at $290 a share. At the end of
trading, he had to pay up for those shares. As it turned out, he was sold
the 1000 shares he already owned, and was wiped out of the $150,000 he had
managed to save in 14 years. He went to Ralston and the Bank of California
and the bank took over his real estate and loaned him enough money to pay
for his mining stock. It left him destitute. Ralston personally advanced him
$500 out of his own pocket. Friends of Sharon pressed Ralston to find a
permanent position for Sharon. But Ralston was understandably reluctant to
find a job for a man who had proved himself an utter failure.

Things had not gone well for the Bank of California. Their agents had failed
and owed the Bank thousands and thousands of dollars. Someone was needed to
step in and set things right for the Bank in Virginia City. Ralston was
persuaded to send Sharon to clean things up. Sharon had other things on his
mind as he left the bank following final instructions from Ralston. He is
quote as saying, "I'll get even. I'll get even with the Comstock yet."
Ralston weakened and sent his brother James to follow-up on Sharon.

Contrary to what your page states, Sharon was not considered a "financial
dead" shot. If anything he couldn't hit the side of the proverbial barn in
the financial world. He did not inspire confidence in anyone in the
financial world -- especially among the directors of the Bank of California.

Sharon did manage to clean up the fiscal mess for the Bank in Virginia City.
In fact, he turned things around to an extent that amazed everyone; even
Ralston. He then began an examination of the general situation on the
Comstock. In the end, it was his conclusion that he had reached the place
where all of the money on the Pacific Coast was coming from. he made two
recommendations to Ralston and the Bank. First; the Bank must monopolize the
Comstock below and above ground. With Sharon as the Bank's representative,
everything could be under control of Ralston and the Bank. Second; water was
a major concern for the Comstock. It flooded the mines and seemed relentless
in it's efforts to drive man from the mines. Sharon was convinced after
personal excursions into many of the mines, that if they were drained,
bonanza's would be in easy reach.

Ralston was convinced, despite initial misgivings, that Sharon was the man
to protect both the interests of the Bank and himself in Virginia City. The
directors of the Bank favored the establishment of a branch of the bank in
that city, but were not certain of Sharon. With one mis-step, he had lost
his own wealth and they did not want him to do the same for the bank.
Ralston reminded them that Sharon had returned them to the one percent a
month dividend. If he could do that, then he was their man in Virginia City.
The directors relented and Sharon became the Bank's representative in their
new branch.

In the late fall of 1868, the grip of the Bank of California upon the
Comstock was threatened by Adolph Sutro and his tunnel. The tunnel would
cost a royalty of $2 per ton on ore brought from the mines via the tunnel.
That December, Sharon called for I.E. James, a leading mining surveyor and
is said to have asked "Can you run a road from Virginia City to the Carson
River?" James replied that he could. Sharon is said to commanded, "Do it,
then, at once." Thirty days later, the surveys were complete and Ralston
gave immediate orders to begin grading.

Contrary to what is mentioned in the page, there had been five previous
companies chartered to build the railroad. Sharon bought the rights to those
companies so there could be no question as to the right's of the new
Virginia & Truckee. He went to the counties of Storey, Lyon and Orsmby and
convinced them to give $575,000 as a free gift without obligations of any
kind. He also compelled mining companies owned by the bank to come up with
an additional $700,000 which they had previously promised to Sutro for the
completion of his tunnel. In less than two months, Sharon handed Ralston
this virtual gift from the people of $1,275,000 with no strings attached.
Sutro was cut out of the promised funds, and dealt an almost fatal blow. It
was he who confided to his cronies that this was "the crookedest railroad in
the world; referring more to the V&T's financial foundations than he was to
the roadbed's physical features.

As far as the most turns on a railroad, the Mount Tamalpias and Muir Woods
Railroad may have held that distinction. From the station in Mill Valley to
the Tavern at the top of Mount Tamalpias and the branch down to Muir Woods,
it had far more twists and turns than the V&T ever did. As well, the famed
Darjeeling Railway climbing into the Himalaya's in India out does the V&T
for the physical title.

The V&T sought financial relief in the early part of the 20th Century by
selling a fair amount of equipment to the construction company engaged in
the building of the Canadian Pacific through the wilderness of British
Columbia. A fair number of surplus locomotives and cars went north to
Canada.

As to the failure of Ralston and the Bank of California, it was
Sharon buying stock in the Ophir to gain control from Flood, Fair, Mackay
and O'Brien. Their Consolidated Virginia and California mines had produced
an overwhelming bonanza. So much Comstock silver and gold had been produced
that the assets of the new Bank of Nevada were well in excess of those of
the Bank of California. The race to control Ophir threw the stock market
into a horrible decline. The last of Ralston's great ventures in San
Francisco was to have been the Spring Valley Water Company, to be sold to
the city of San Francisco. The sale price of $15,500,000 was too great and
the city fathers could not be convinced to pay. The stock market had been in
decline for the month of August. In the last week of the month, values had
fallen by $42,600,000.

When the Ophir stock fell to 36, Ralston and the Bank of California
were as good as gone. A rush on the bank brought panic to the financial
world of San Francisco. At the end of the day, the Bank of California
suspended operations with no plans to resume. Over $1,400,000 in coin had
been paid out along with other considerable payments.

The following day, the directors of the Bank had no choice but to
call in Ralston's debts, and ask for his resignation. Ralston had his wife
gather her personal belongings and go to an uncle's house. He then handed
all of his property over to Sharon for the benefit of his creditors. He was
indebted to the bank for over four million dollars, two million to Sharon,
and to others for about three and a half million dollars -- a total of nine
and one-half million dollars. His assets were only four and one-half. His
resignation was asked for and given. He left the Bank penniless.

As to his death, the coroner noted no water in his lungs. The
consensus is that he suffered some kind of stroke while swimming in the San
Francisco Bay on the afternoon of August 27, 1875.

Roger M. Colton

May 5, 2000