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SAMUEL PROCTOR ORAL HISTORY PROGRAM at
the University of Florida.
D--We are doing an interview with Joseph Maddlone in his home in Royal Palm
Beach, Florida. The date is Feb. 16, 1988. The interviewer is David
Dodrill and we'll get started. Joe, tell me a little bit about your-
self. When and where were you born, a little bit about your background,
J--I was born in Brooklyn, New York. And I lived there until I was married.
The--it's clicking again.
D--You were telling me a little bit about your background before.
J--When we were married we moved to Long Island and I went into a bank out
there as chief of operations, assistant cashier in charge of operations,
and the war was on. I had tried to get in as a pilot but they didn't like
my ----- vision. So, I didn't get in and stayed as a banker. And I
helped to get the branch in Deer Park in Long Island and then went down
to Wall Street. At Wall Street I was there with the ---- Co. of America.
And we were building helicopters for Korea. So, I got down there and
-pieked-up ---- and bought some Wall Street stock and took the stock from
a dollar to five dollars and we got army contracts and we agreed to own
the company, and got greedy and wanted the whole thing and I told them
to go to hell and have the whole thing. In the meantime, all the people
I had gotten into it. I said, "hold your stock", to my family and friends.
And eventually the stock went to fourteen. We bought it for a dollar.
I started at a dollar and raised it to two and then three and then five
dollars. And most of the Greeks bought it at five. But we bought it
at one. So, for a hundred bucks you got fourteen hundred. Then, I was
selected from a group of nine bankers to reorganize the ----- in El
Salvador. And I was to install modern machines. It was all done by
hand and to cash a check would take you a half hour. So, I went with the
National Cash Register Co. to study their machines that they were using "(
----. And they came out with a brand new machine called sensamatic
which had four positions on it: general ledger, regular bookkeeping,
accounts payable, accounts receivable. And they asked me to try it out.
So I did. I said, "What happens if you take it from mode 1 to mode 4?"
You can't do that. "Why can't you do that?" The bookkeeper's not
going to know what the hell she's doing. She's just going to turn it
from one to four. He said, "Turn it from one to four." So I did and it
stopped the machine. He said, "My God, why'4 you put a stopper on it?"
I said, "I moved it from one to four." He said, "You can't teach some-
body to go from four, three, two, one." They're going to go from one
to four or four to one because they are going to start over. Anyway,
they did fix the machine. So, by that time I had picked out National
CAsh Register. And the job was $1,000 a month plus expense in El Sal-
vador, plus living expense for my family. So, we sold the house in Bell-
more and my family came to Miami. ANd the board of directors of the bank
in El Salvador couldn't make up their mind and I said, "Forget it." Be-
cause some guy came to me with a can of milk and he said to me, "I got
this milk and put it in the can and it'd be fresh milk." And I said,
"Impossible" Then why can't the big ones like Borden do it? "Well,
they didn't work on it long enough." But the Swiss have. I said,
"What did the Swiss do?" "They sterilize goat milk and put it in cans."
I said, "Get me a can." I could have got it myself, but he had to do
something, you know. While I was in New York I had an accounting tax
practice for doctors, dentists, and lawyers. And that was my business.
I got finished in the bank and I'd go do tax accounting. In fact, I
worked with Tom Donovan who was one of the guys on the atomic bomb pro-
ject, and he had an office two hundred feet under ground. He got lost
in London someplace and came back after the war and said, "Why don't
you do my taxes?" Well, where is the file on the last one that I did?
It showed that the government owed him 794 dollars. And I said, "Did
you get the check?" He said that he never got it. I said, "Did you
tell them tht you moved?" He said, "well, I didn't know where the hell
I was moving to. I moved to London. I was in a hole in the ground."
So, I said, "Let's go down to the IRS and tell them that we want the check."
"You can't do that. I've worked for the government long enough." I said,
"Tom, come with me." It wasn't very far from where my bank was so we
went down on the lunch hour. And I told them.. And, by God, they found
the check in his file. 794 and 80 some cents. He couldn't get over that.
He said "You get half of this.." And he gave me half of it. Anyway,
waht do I do next., So, we got down here and we did the milk. I built
the factory out in Hilea.
D-Which one was that?
J-The North American Milk Company--NAM. We got the cans and everything.
We had the machines coming in. It was a beautiful plant. Oh, it was
I v\\. V V,4 b)
beautiful. Then again, the guys who invested in it and the lawyer was
very greedy. And I don't like greedy people. So, I..... They didn't
know how to run an annual meeting. So, I raised capital by mail., This
was never done. But I had had it approved in New York., The SEC in New
YOrk and if I took the possible perspectives and put them in an ad., It
was a very expensive ad. And it gave the details and a few other things.
I could put a coupon on the bottom. The brokers in here would come in
and every time they opened the mail there would be a check in the mail.,
And they would come in and say, they had never seen this before and on
and on., So, now I had Wall Street interested in the milk. And they
were sending cans up to New York and they were keeping them in their
office on their desk where they could see that it wasn't in the refriger-
ator. And they put them on the roof. Anyway, we were ready to go and
/0the -d /said "Hold everything." Oh, the navy had given us a contract
for a million cans of milk., The big tomato juice cans. And ---- had
just discovered powdered milk., Because when you take powdered milk of
a can that big you've got 30 quarts and you still have the liquid., And
that's what affected the thing., They were going to deliver this to Japan
because the guys were left without milk..
D-About what year was that?
J-1951, 52. So, friends of mine knew a book maker. Oh, I used to design
checks. At the Johnson Company, the vice president and owner was
Chester BEaks,. Chester was a real soldier., This guy had the back of
his hands burned in the desert in AFrica.. Because they didn't feel.....
Believe it or not they used to steel guns and cannons. And they didn't
Know exactly how to close the ---., So when the cannon goes, the back
would fired out unless the was closed., So, they discovered if you
did that with you hand it would slam it shut in such a way that it was
too hot and then they would fire the shells at the Chinamen.. That's
what he was doing. Anyway Chester said, "You know, now you're moving.
-.j('t v,, IV eC A,*''u u *6()V
-- ------. There's a friend of mine down there who used to be
a book maker." I said that's nice., I said, "Johnson is a --
company,, No book makers around them.." Up in Long Island society, I
used to play golf with Chester out at the Smoky Hollow Country Club
which was the place. I met Pete Morrison down here., He said, "A friend
of mine wants to build a peir,. But he doesn't know about financing or
anything." So he introduced me to him and it was Dexter Saunders.. He's
retired now, but he has one of the biggest hardware stores in Miami.
Anything you want is in that store., I don't care what it is, it's in
L, 5/? L Lm ':
that store.. Pete Auss is his manager now. Pete Auss used to be a
European man. Pete speaks fluent in six languages. I don't know how
you are going to tie all this together,. You are going to have a thou-
D--That's all right. I'll help you along,.
J--You'll help me along? That's nice. I need some help now.. Where was I?
D-Talking about Pete Auss,.
J-He handled all of the tours from Europe because of his language. He
spoke Dutch, German, French, Italian and two or three others. He didn't
know Norwegian., I used to kid him. My girlfriend, was Norwegian and she
taught me a few things. So, I would say goodbye in Norwegian and he'd
look. That's all I knew. And I would thank him. And he would be
bright-eyed. Anyway, I met him and he introduced me to Saunders and
Pete,. Saunders didn't know an export from a hole in the wall, but
Pete's an expert. And that was the business before Gulf American. So,
Saunders wanted to build a per out there., And, nobody had ever gotten
any land out of the capitol. So, we did get a contract with the cap-
itol.. For twenty years we could build a peir at our expense and they
would get ten percent of the gross., And at the end of twenty years, the
pefr would than belong to the ocunty. The county hac now taken it over
/l / '-A >"j? ,A "[ U4 1 u C k ( Ah\ ti
and extended it. Nice peir. And ------- All those
nails and hammers., But he did get the lumber,. I still have some pic-
tures of that,. So, the fellas out in,.,,.;,.the storekeepers I told you about
out in Miami Springs wanted a bank. There was only one bank in that
whole area out by the airport. nd that was in Hilea., The old guy was
a pain in the neck. Nobody like him., I forget his name. Anyway, so
we want a bank. I said, "We'll get you bank." AFter a long hassle
we got it. And they became bankers., Helped a few others., A congressman
helped me and he became president of the bank,. I was doing everything.,
I was there from 7:00 in the morning to sometimes 10:00 at night,.. Because
I had a --- bunch. They didn't know the difference between credits or
nothing. ANd the banks downtown didn't like me because.out at the air-
port where all the big accounts are and I'm getting them because I opened
on Friday nights. They were not opened past 2:00, And the reason I
opened on Friday nights was that's when they got paid, And they would
saturate the sops with their checks. So, here I was., The first time we
were opened you couldn't get within a quarter mile of the bank,., The
traffic was jammed solid., They were on people's lawns and everything.
And we almost ran out of cash. But I thought that they would be in and
I had two million dollars. I tell you.. Anyway, it was in the paper.
The next Wednesday, out come the bankers of downtown. They were ob-
jecting to me being opened on Fridays. I said, the shop owners approved
it and I'll be opened on Friday from now until doomsday. And, anyway,
they walked away insulted. Anyway, I had the New York banks behind me
Gross National primarily. The vice-president of that was John Dowinkle.
And how did I meet him? When I did my thesis for Rutgers graduate school,
John was a banker on a team of three. He gave it to me good., And I
said, "Why?" He said, no country banker could write a thesis like that.
I said, "You've got to be kidding.." Anyway, that's what it was. They
asked me on every goddamn sentence, what did you do? Why did you use
those words? used such words that they didn't hear before., T(. c'
"JIf\'0iJ5', and a couple of others,., And they were challenging me, so
I said to them, "Gentlemen, have any of you ever read the front end of
a dictionary?" I had to do something. These guys were a pain in the
neck. And challenging my words,. And I don't like everybody challenging
my words. Anyway, I explained to them carefully what I was thinking
about when I wrote it. And they accepted that., Now, please ask me one
question. What does the word liao6n mean to you? And they gave me this
bullshit about the army and one officer to another. I said, nope., What
does it mean to you? Almost the same thing. I said, no., What does it
mean to you? I said, "If you look in the dictionary, the first meaning
in the definition is an illicit romance." O.K., Maddlone, we'll let
you know., I said, "What do you mean you'll let me know? Is this over?"
He said yes. They realized that I knew what the hell I was talking about.
Because I had read the front of the dictionary and knew how the words
were chosen. YOu see, whenever you go to a meeting, you've got to know
beforehand more than that guy.. I never lost a case in any state because
no matter what beareaucrat was behind it, I knew that law before I went
there and my particular point was etched in my memory. Don't ever go to
a meeting without knowing.
J--And sometimes when you are caught short it comes in handy. I was dealing
with, when I was with Gulf AMerican Gordon Cooper came in. I didn't
know Gordon Cooper from a hole in the wall. But he was the only astro-
naut who manually brought the spaceship back into the earth's atmosphere.
I don't know whether you know that or not. Well, he's the only one. He
was in Miamii and he wanted to start up a company. So, I started up a
company for him, Cooper and Associates. And he had a big watch on his
arm. I said, what's that? It's a pretty big watch. He said, I know but
it's fantastically accurate. He said it was a quartz watch. I said, "How
much is that?" He said "A thousand dollars." "That's fine. You can keep
it." Anyway, we became good friends. ANd people were using Gordon like
a mat. Because he was an astronaut. And he got to like me and I got to
like him. And, what the hell was the whole point of this thing? I'm
going off in so many directions.
D--You were talking about knowing more than the people you are talking to and
going into meetings.
J--Gordon did not know, God, he knew airplanes. He could take anything that
S he liked. i -u That's how
I learned to fly. He was screaming into a megaphone, don't do this, don't
D--That will get you to fly real quick. Tell me a little bit about your
first association with the Rosens and Gulf American and stuff like that.
SJ--Well, I tell you I went down ^ ." and I saw the grass
and I thought could' t be that bad.
D--That was in Cape Coral?
J--Yes. And so, I said to Connie Mack, "I'll stay." I got back to Miami and
I was put in as a understudy to Sol Sandler, a secretary. And I .ascended
very rapidly that Sol didn't know fo nothing. Everything that came
across his desk he would give to me. And what was amazing was that it
was done so quick. And then they said, Leonard said to me, "We are
going to move." One of the banks that I helped to organize was the
Boulevard National BAnk. And the original office was the store right
next to where it is. ow. But it was advetpesed by Gulf American and
-Ait was wide enough for them to go in. So, when I
got there the desks were like this, one, two, three, four. There was
no spaces. So, Leonard found this place up on ,31st Street. And he
said, "we're going to move us up there. MOve us up there." I said,
"O.K." So, I was wanted. There was nothing in there. It was just
like an empty warehouse. From one end to the other. It had been
occupied by Badcock and Wilcox who were doing a dam job in South
America. This is where they made the blueprints. So, they had all
kinds of lights on the ceiling and nothing below. NOthing. So, I had
to figure out who was going to go where and install telephone and power.
Which we did. But when we were into the doing of it, the lights hadn't
been lit for a long time, so the valves in the lights had been leaking. K/ 1 l
What we finally did was one
of them went on fire and the....When we opened this office on Monday
morning it went- obt Wednesday before the MOnday. The sprinklers went
on shooting water all over that place, all over the clean floor. And
these guys were being pushed by me every morning to late at night.
The electricians, the carpenters. Anyway, it was one hell of a mess.
So, we got the guys to come in and clean up and they bought in water
vacuums. WE got the water up and now we've got to replace all of the
valves. YOu know, a couple ?f hundred. And they are way up there. You
can't reach them with a latter. So, we brought all the valves from
Miami. All of it. And then we went up to Ft. Lauderdale and got the
rest of them. And the electricians to put them up. And they did a hell
of a job. So, with moving on Monday. It was moving on Sunday and going
to start work on Monday. You know, Leonard was one if somebody was
standing around he would say "What the hell are you doing here?" And
this kind of thing. The poor guy may be drinking a glass of water or
something. Anyway, Sunday night came and Leonard comes over in his
shorts and his stupid sneakers. He'd been out playing. I don't know
what he'd been doing. He said, "I can't believe this." Because it was
all done. We were ready to move in. They had been moving in all day.
It was Sunday night. He saw all the desks around the place. We opened
Monday. Not a l was out of place. If you left a pencil on the desk
like that, that's where it was Monday morning. He couldn't get over it.
He couldn't believe it. He ordered a party and we had a part. I'll tell
you it was a real good one. He had Filet Mignon for everybody.
J--And there was a guy named George. He was the comptroller. And you see
I had my own way. I marked everyplace in the office as Bay 1, Bay 2.
Where that stuff came from, they knew where to put it. No question. And
that's why this pencil was there because that's where she left it. Not
one was lost Monday morning. Leonard was jumping up and down.
D--How many employees were moved in?
J--I would say over a hundred. Sol's office was in the middle with partitions
around it. Leonard's office was number one. The whole thing. He
couldn't get over it. He was very happy. That was when we moved in.
And from then on it was just business as usual. They installed a compu-
ter. And I remember they couldn't tell if the floor was strong enough
to stand the weight of the computer. So, the easiest way to do this is
to pick the floors. They said, "How are you going to do that?" I said,
"Give me a hammer and I'll find out." So I did. I knocked a hole in the
floor. And what the hell do I dod with it? So everybody's looking be-
cause the ladies saw the dust falling and they got out of there. But
we found out the floor was that thick and it could stand the weight. And
they brought in the stuff. But, you know, people don't use their heads.
D--If Leonard had a job to do, would he care too much as far as who he
assigned as long as he thought they might be able to get the job done.
J--I guess that's the way he thought. I would have to be there. He would
/, say to me, "Joe, we've got to build a bridge." What d6 we do? / I c [A '-
Salfway up between where it is
now and the other bridge. Almost halfway up. I would say about two-
fifths of the way.
D--That would be about where the projection for the midpoint bridge is./ If
-- it goes up there they are going to have to drive up two miles to the
main building where we are operating. That's right. So, we asked the
county to build a bridge and the county says nothing doing. We don't
have the money. We said, "Well, find the money." Why don't you set up
a bridge authority. Which I did. And it was voted by everybody. And
we had the bridge authority. There was a guy named Jim Sims. Jim Sims
was on Wall Street and he might finance this. ANd I went to see Jim and
he said, "I think that we can do it." He said will you help me write the
perspct? I had written it for a milk company. I had written it for
helicopters. Yes, I'll help you. So we did. We worked on it. We put
out a bond issue for two million six. In order to do that, we had to
cancel the bridge authority. So we held another election and we can-
celled it. It was an easy way to do things. We went to work on the
bridge. So, JIm says "We can't use and Associates." I said,
"They are the number one engineers down here." "They are not Wall
Street engineers, JOe." So,......I could write a story about this too.
So Greiner and Company in Maryland did it. And remember that vice
president's name under Nixon?
J--Yes. Well, one of the fellas that was dealing with us was supposed to
be their economist. And he's the one who exposed Agnew. '" I
think he name was. Yes., He exposed Agnew. I called him up. I didn't
know they were such a big company. I said, "YOu build bridges?" They
said, "Yes, we build bridges." So I said, "Who can I talk to about
taking on a job in Cape Coral?" Where's that? Do you know where Ft.
Myers is? Across the river, So the chairman, John Conolly and he came
down. And I'll never forget. Leonard said, "Take him out to dinner."
He's down there and he's our guest.
D--This is not the same John Conolly.
J-NO, it just happens to be the same name. And he stayed at the Commerce
Hotel. So he paid for the drinks. I'm trying to get this job, so I said,
have it your way. Anyway, by the way, "Have you been seriously ill re-
cently?" He said, "Yes, how did you know?" I said, the way you signed
your name. He said, the way I signed my name? I said yes, you had a
very bad heart condition and you were very frightened. And he says,
"I'll be goddammed., Who told you?" I said, "Nobody told me., I just
got it from you writing. I could tell you a lot more about yourself if
you want to know it." He said, "I want to hear more about this." This
is true. Believe it. If you don't believe me, ask all those guys and
they will tell you. So, I said, "You now have a problem of worrying
about you will," He did. You don't whether it should be the bank or
somebody else. I said, "Who is the somebody else?" He said,."My wife."
I said, "Who has taken care of you family for all these years?" He says,
"My wife.." I said, that is your personal representative., He said you
just made up my mind for me., You know, you can't do too much with this
stuff. Because there was some other things that I wanted to tell him.
I told him the next day. We went out to Cape Coral. We looked at the ,'(
side. We drove around and looked at the other side. Had lunch and he
said, "What's down at the other end?" Beach is down there. There is a
ferry., He said, "Let's go down there and look at the ferry.," So we went
down to the ferry and by the ferry was a pcinic table under some pine
trees. I remember this as if it was yesterday. And the seagulls were
stalking around, you know. And the ferry came in and the cars got off.
D--This was going out to Sanibel?
J--Yes. And we're sitting on a bench. So, we sat there for two hours. I
didn't talk to him. He didn't talk to me. He was just having a real ,,
good reflection, I guess. I don't know what. So, I said it was about
time we got back. So, we drove back to Miami. And he went to the air-
port and I took him to the airport. I said, "John, I'll tell you what's
bothering you. You may have a recurrence of what you jsut had. And you
wil NOT have a recurrence." He said, "I'm glad I made this trip. All
these things that have been bothering me have gone away." I said, it
must have been well, because ten years from today, you are going to take
me to dinner. He says, "Goddamnit, I'm going to do that." Well, ten years
later, I got a call. They had a company jet. IIe said "Je, this is
Connolly. I'm going to meet you at the airport at some set time." I
said, "Fine." He said, "Do you know why?" I said, "I know why." So
that's what he did. He came to dinner. We had dinner and all of that.
WE wandered around Miami BEach and what have you. Finally, he got to
going. I said, "What's with you? You are wondering if there will be
another ten?" He said, "Well, I wasn't really thinking that. I was just
happy for the last ten. Everything you said. I made my wife the executor
of my estate. EVerything went just fine. The company went through. And
I am happy to have enjoyed good health." I said, "Well, my expertise
doesn't go beyond five years." He said, "Well, you went to ten." I
said, "No, be happy with five." So, I said just be happy with five. I
never heard from him again. I don't know whether he died. I said, "Live
for each day and be happy with each day."
D--Did his company own the bridge?
.,: r^..*. 13
J--Yes they did. I may have the perspectives. I may have it.
D--So, the two point six million dollars built the bridge. Was that, were
those bonds issued by the company? Or were they just....
7 J--By the underwriters. Not by us. We paid the underwriters at the closing.
The underwriters paid at the closing. Here's an original. How
many of those did you see?
D--I've seen a few of these.
J--Did you hear about British Honduras?
D--I knew that the company owned land down there, but I.... Tell me about
J--There's not much to tell.
D--Why did they purchase land down there to begin with?
J--Well, you know when we went to out public offering. I can't find it at
the moment, but it's in there somewhere. The underwriters said, "You've
been very successful so far. What are you going to do down the line?"
So, Leonard says, "Well, we are going to buy more property and develop
it." So, I don't know if you know the price that we paid for the land.
25 dollars per acre.
D--For which land?
J--For all of it.
J--In Cape Coral.
D-That's just an average price?
J--It's an average price. 25 dollars an acre. Well, I don't have the con-
tract. But I think I remember that amount. And I think the land at
Golden Gate was the same price. About the same price. I'm not sure
of the amounts. Because Leonard and the lawyers bought that land. I
remember Leonard and I were in New York and we happened to get on the same
plane. I think that I told you. A / i o0d c, .v\ \V)-
D--Tell me about that again.
J-The property on Cape Coral through the Company. It was
part of the '" i And Ogden Phipps was the executor. He was
on coming to Miami. ANd he and Leonard recognized each
other. Until we got into a hilarious discussion about how good we were
doing. He said he never would have believe it, he never would have sold
us the land. He said, "I only sold it to you because I thought I was
going to foreclose on ." So, Leonard had the last laugh on him.
Because we developed it 100 percent. We went out to buy more and more and
D--How big a piece of property did they sell to the company, do you know?
J--I don't remember. Somewhere near a tract map.
D-I'd like to see that.
J--I don't know if it's in there.
D-I'll make a note. We can look later. That would be really helpful.
" 7/ J-So, we bought from / I Laboratory people. The guy would never sell
it to Leonard. I forget his name. I only heard it a couple of times when
Leonard asked me to go with him. YOu see, we couldn't get him. We didn't.
He never did. Somebody else bought it. I think Pete Petrie bought it.
D--Which piece of property was it?
J--It was an artpiece.
D--Was it on the river?
J--It's probably somewhere. I think it was that piece there.
D--That's now a park.
D--Yes. It's an eco-park or something like that. Supposedly some kind of
deal with the state that it will never be developed.
J--Anyway, that's where it is. And I don't remember all the different ones
because Leonard was always buying. So, the underwriter said, "What are
you going to do for the future?" On our trip out west, he contracted for
land out in Arizona on the border.
J-And, anyway. WE bought land in New Mexico, three townships. There was
36 miles in each one. Is that right?
J--There's some in northern Arizona near Kingman. Southern Arizona, Northern
i- ARizona, New Mexico, and Utah. And we developed. We didn't develop Utah
i. We did do something with Kingman. Whatever they were doing
they did. Because once we bought it it was the engineer's job to do some-
thing with it. Utah was too far out from the world., That's were they
put the atom bomb.
D--Plutoniom? No, Uranium.
J--Green River, Utah is the uranium capital of the United STates. Anything
6('. 0 ov\," '),",-If
you touched there the ton would go off. Just like that. Anyway, they
did start to try to develop Kingman. A number of years. We are not
talking about.... In one of my annual reports, we have land, much land.
Because Leonard was buying it a couple fd bucks an acre., We had 98,000
Coy 01 Pyk" -LO I/
acres. I started a separate company, Collgry REalty. ou i ? uA\. ( \
D--Do you have any idea how much they paid for land in British Honduras.
J--About eight dollars an acre. Eight dollars an acre. They offered it to
anybody for ten or twelve. No takers. If you could see it, I'll show
you where there's pictures of it, and I had a caretaker out there. I
gave him a contract to cut the gum trees so he could sell it to Beech-
nut and Wrigley's. And his wife dug her a hole in the ground on the
property and she fell into a hole of shiney objects. And since they
have a law there, "Don't touch anything.." She didn't touch anything.,
He put a rope down there and pulled it out,., And the next day, believe
it or not, she fell thought another hole. Because she had already
covered up the first one with brush. But if you're familiar with that
part of the ocunty, it's all Aztec and Myai ruins. And they were....
He said, "I can show you ruins on this property that had got to made
byman. George, he was very nice. He used to walk behind me. Instead
of walking in front of me, he'd walk behind me. Because he always thought
there might be snakes. We used to walk through the bush. Anyways, one
time an engineer came with me.
D--Whatever became of all that property?
J-It's still there.
D-Who owns it? / ;
J-I think it's part of ouf holdings.. I think they've kept it up, you know
paying taxes on it. Because the British government needing some money
put an excise tax on land owned by farmers., And the last one that I paid
was 57,000. I recall. So, when GAC took it over, they didn't know from
nothing. Oh, stupid men who were supposed to be brilliant. Brilliant
like nothing. So, that was... we had the land and of course we went on.
And I of course proved that we sold the land.
D-Did the Rosens really think they were going to build cities like in Golden
Gate and Remuda and River Ranch?
J--They thought of it that way. They had intentions to do it and the state
was harrassing them too much, constantly,.
D--So, it wasn't like a different type of development in those pl..aces?
It would be more of a camping ty p thing as opposed to homes. -Or do they?
J--No, in River Ranch Acres I think they had, no they didn't' have a camp there.
Maybe they had a camp there,. I don't know. They did?
D--They had a big lodge there.,
J-Oh, yes. That's a very good lodge., It was originally. I don't know what
it is now.. The local people used to congregate there because it was the
only place where there was music, fun, and booze. It was a wild time.
I was there once. The other place we built that had a camp ground was
Ocala. We had property in Ocala. Did somebody tell you about that?
J-Ocala Springs, 4800 acres. Right next to Silver Springs. Yes. You could
spit from our property over on to their place,.
D-What was the name of the property?
J--Ocala Springs, we called it.
D-And it was a campground?
J--There was a campground on it,. It was heavy with Indian Legend. Yes.
Really. Infact, I just saw the book on it., They were trying to sell
it. Here's Arizona. Here's Ocala Springs. Me and the engineers were
the only ones who would get blueprints. Ocala East., Same thing.
---looking at blueprints--
I haven't looked at these in years,. Look over here some place.,
D-How about over here?
J--It must be in here, because here is the campgrounds. Here's the trailer
park. These are foot paths, trails., It must be these. It couldn't be
this. Maybe it was here,. Here's another camp. Here's houses. Here's
< 7 Indian territory. I have to say the we made on it. What's in
D--Just a couple of little things there.
J--I was up there. I had to go to the real estate agencies all the time for
D--So, in other words, when you were going to list a property for sale, you
would have to take all this information to the state agencies.
J--Oh, yes,. When we planned it out. Right.,
D--If you all were going to sell property from Kingman in Florida would you
have to take stuff from that also to the state?
J--Yes, Right... We were lucky because we had a spring on the property,. Here's
that dump. The airport is right next to it. Anyway,
D--Apart from that., Let's get off of that subject., How was money raised to
do the different development projects? Obviously land sales did not ac-
count for very much of it because that was so little.
J-We had a lot of money coming in.,
D-O.K., But it wouldn't near cover the cost,.
J-No, we'd go borrow.,
D-Would most of the borrowing be done from banks?
J-Banks or individuals in Los Angeles.
D-I didn't know who you said.,
J-- I But, he died too., Very old man. We came to our office
we said how high is this guy going? Brilliant financial person,. As you
can see, his sons are doing very well.. Fortune just wrote them up for
the wealthiest in the country,. We would get banks or groups of banks..
In my department we would put it together.,
D--Any particular banks were really big lenders?
J--Boca Raton, but that bank is sold now. Miami National Bank. That's
gone. We haven't been there for 20 years. I don't think banks keep
records for 20 years,.
D--No, I don't intend to get records,., Just curious., Boca Raton,., Is that
Boca Raton National Bank?
SJ--Boca Raton., We-would just owned and they s9lKd out,.
D-When did the company go public? Do you remember?
J-I don't remember the exact date., Did any of these guys tell you anything?
D--Most of them, their memory isn't too good., Did Leonard just decide that
he couldn't raise enough money from banks and they decided to go public
or was this idea yours?
J--He had gotten information,. You.see, Leonard would ask anybody_ in the
world, he'd ask the cab guy. Don't fool yourself. He would. He had a
black guy that he used to shine shoes. He'd ask him,. Rio Rico closing
documents. I closed that one., I don't remember when we wndt public.,
D--How much money was raised from the..,.?
J-I don't remember that either, But that was the first time we went public,.,
That was the first attempt at breaking out from a small circle to big,.
And it went O,..K. We had about the lowest form of underwriters on Wall
6AY Street, but they did the job., I'm trying to think. & Co. All
gone and another one. They used to call me almost every day, "Joe, do
you think we made a mistake?" REally, they were scared to hell, because
the real estate people, mostly in Florida, were after us, and when it
went Federal, they got after us. And they wpuld question everything i
our perspectives, not the financial perspectives, in the land perspectives.
And make them do them over, correct them. And I didn't get into that too
much because I was administration. Keeping 49 companies straight is a
big job. Well, I don't know how much tape is in these things, but you / '
keep5recording. It only records while you are talking.
D--You can't beat that.
J-616, whatever that is. Side number two.
D-O.K. So, when they went public the first time was the first real attempt
to raise the big kind of money they needed for more development, more
purchasing of lnfd. What else did they do to raise money, besides the
loans and going public. Did they issue bonds?
J-That was the original issue, bonds. One of the ways that we raised money
was very good. And it raised millions. It was planned where by you as
a person who was paying on a lot would be offered a discount if you cashed
up, paid up. And these were repeated every now and then, when we needed
money and we didn't have enough fdr borrowing. But we were always on time
and always paid our bills and always made good on our lands, all of them.
WP tin^.Ab ( ,!& A" C",pAO A kI ,
No problem. V But sometimes we would run ahead on developmental expense.
Then we would take, make an offer to one of these plais. If you cash up
now, we will give you a dsicount., And we would raise from seven to
twelve million. That is A number 1.
J-We thought up all of these things that people could do, but don't do.
I don't know whether any other developers, like Deltona or General Devel-
opment copied us., But usually whenever we needed money, we got it. We
got it. And you didn't wait six months for you down payable to be paid.
They were paid.
D-So, Gulf American was...
J-I would say was moderately, but adequately financed. And the guys who
were going to make us A number 1 was G.A.C., Corporation. The idiot boys
of Allentown. THey were going to change this business. THe first thing
they wanted to do was not sell lots, but sell condominiums on three
islands. DId you hear about Three Island?
D-Is that the Bahamas?
J-No. It's between Alandale and Xavier. You've got two years of homework
to do, you know that?
D-Oh, I know. That was primarily with G.A.C. wasn't it?
D-You see, I'm not really covering much beyond 1969.
J-Oh, I see, but I gave you a lot of the stuff.
D--Oh, that's O.K. It will help. It will help get a little perspective
on the thing.
J-Would you like a cup of coffee?
D-Sure. Who are REsearch Associates?
J-They used to be a subsidiary of the south of First National BAnk of MIami,
which is now known as Southeast Bank., And they used to do these studies
for all kinds of businesses, For some reason they sold it to the guy who
was running it., And he got a hold of one of my applications and goddamn
he copied everything in it. And I did not have it copyrighted., So, then
Dr. Wolfe got a hold of the formulas for projections, earning for three
years. Then he claimed them as His own and he became the expert., He's
a Dutchman/'obnoxious in my opinion. Anyway, anyone who steals something
from some other guy, whoever, is just no good! Nothing. But m# were so
accurate that when you project earning, assets, and liabilities for the
year, they can be off by one hell of an amount. You know, you are talking
about a bank. Billions of dollars rolling through it. O.K. for three
years you have to project down the line what this bank will do, profits
will be, and whether it is going to be profitable at all to get these
guys chartered. But I worked very closely with the Federal Reserve Bank
in Atlanta, research division. And they would send me all of their work.
What their latest bulletins were, what their latest research was. It
was a pretty small bank., From 10-20, 20-40 and so forth., I never went
beyond 40 because it was a new bank* And when I did V they
couldn't believe the numbers, I wvb.ng. by 75 thousand dollars the
first year. The second year, 87 thousanid., It took about two years,
this bank. Three of them were almost 1. the money.
D-This you prepared?
J-Connelly, Bill Connelly. He wrote it ,p. I printed it in our office.,
Here's bridges, canals, towns. Gulf American Corporation REsearch
Associates, it's my numbers, you see. My name in there., Those guys
were stealing everything from me, what the hell? And this map, I made
this map., If you look right in here, here it is, population per square
mile. Do you use the U.S. GOvernment Census book?
J-I use that too, I would lend you these, but they have a habit of never
coming back to me,
D-Well, I'll tell you.
J-I had some briefs that I lent to the First National Bank of Chicago on
letters ad credits., The best thing I ever saw written, I loaned it to
a guy and he tried to use it. Guess how much he lost on his first deal?
190,000 bucks. He's a young fellow. He did something I told him eter
to do., Never sell anything to a Latin American without getting a letter
of credit on th6 bank of the United States. He never got a letter of
creidt. He's another Maddlone map. These are my maps. I do my own
artwork. They don't touchrth- e. Here we are, right there.
D-That's where the park is today.
J-How the hell did they get away from Petrie. Did they tell you about
D--They told me a little bit, that he opened up his own realty company to
D-I've tried to take to him, but he won't talk to me.,
J-Very suspicious guy. He thinks you are going to write a thing for the
National Enquirer, Good pilot.,
D-Anyway, what happened was, this was designated as a park, in the 70's
when there was all the hullabaloo about dredging the mangroves along here.
So that was part of the compromise deal, that that would never be devel-
oped. So, I don't,...
J-An odd thing happened. I did a public offer for a helicopter company.
I even wrote an article for Helicopter Magazine called "Break w.nd
uCc a X IV
Interference of Col uial Helicopters" because that's what we had. Well,
after all these years go by, who the hell shows up, but Pete i ,
the president and he wants to buy., And practically nothing., So that,
I guess it was up here, so they could send the helicopters out on test
runs. You see, coaxial helicoptersyou could put on this table and fly
this table., It has no door., So, you don't need the tail. It flies by
the blades. That has been the only kpdwn helicopter ever invented and
the Navy uses it to send it out, searching for submarines, And also,
for target., Missles and everything.,
D-I should say.
J-Yours truly wrote it up.
D-Now, you ended up as, what, as treasurer?
J-No, as vice president secretary., 5' A cvi, -- -
D-Now, you were responsible for putting he filing, the different regulatory
steps, what was involved in doing taht?
J-Oh, I never saved one, I saved everything else, but one of those. But
when I first went to the state, and there was an argument over I was ad-
vertising literature., Mendelson had put in the line the lots were not
included in the filing., It was going to be in the next filing., So,
about 8000 dollars worth of printing out the window. So, I noticed that
they had no standard for filing, They had what they called a question-
naire., And if you answered the questionnaire. So, I suggested another
one which was adopted, I'm trying to think of the guys name. He tried
every which way, and he never got it., Anyway, he adopted the letter
;t6 the state., But last I knew it was still being used.In New York I
did a perspective, financial perspectives. This required a lot more
than that. Canada was number one, New York number one, Tennesse mber
one, Missouri number one., General Development may have been maf,at me
in New York. Thy were., Slandering their perspectives., But the idea
for the perspectives came from Ed Alfeary. Ed Alfeary was a real estate
06 VOrn 15scrtJ 4==
"lawyer for the state of New York. And we were over corned q
beef sandwiches at the local deli, He said, "Joey, I've got to get out
of this damn thing,. What can I do?"' I said, Well, why don't you get set c..
in motion a requiremtn for a perspective.? I knew this was my cup of tea.
Give me a typewriter and I'll write one up., That's what I can do. I
can sit down to the typewriter and write a finished piece of work, pow.,
My former partner in the banking business. He could not understand how
I could do that, But, I'll tell you, it saved me in Missouri and it
saved me in New YOrk state, being able to do that. So, what the hell
was I saying,. I said, "why don't you make up a requirement for perspec-
tives, because I knew I could knock this thing out by tomorrow morning.
And, he said, "That's a good idea., I'll see what says," He
was the secretary of state, So, that got it,, He said, "We're going to
have perspectives and I've got good news for you, I've been nominated to
be a judge," They made him a judge and these prspectives came out,.
He said, "Any time you get in trouble see me," I've got a big friend in
New york, And we did. I sent the first perspectives up there because
I knew I could do it, It was terrific, Anyway, they made a lot of ad-
justments to it, but it became standard., And General Development put in
an even better one, They did a better job on it than I did., But we were
always vying with each other. And I know in Tennesee, we adopted in New
York the Tennessee perspectives, Because I had written that note, Yea,
Bob Miller, he went to law school at night, so he could be a lawyer., He
worked with-security in Tennessee. He filed them., They considered this
piece of land undr security. I said, "Security for what?" They said a
mortgage., Oh, it's great. I really enjoyed all the states.
D-Was there a lot of competition between Gulf American and General Develop-
J-No, it was just calculated differently., They were lily white and we
were not so lily white, We would try to sell any which way we could,,
And tehy copied us, buy they didn't go a s far as we did., And it came
to my attention that something was going wrong someplace I had to fix
it in the company before the real estate commission, There was no
Like my bones when he found out. I fired the hold crew in Ion-
don. I fired the whole crew in Rome,. One business. Because the broker
we had there was an Italian broker who thought he was a Rock Hudson, or
somebody. And he never told us, but...., You see, being a banker you
get a lot of information from two places., The guy at security and the
bank. So, I didn't understand Italian., I didn't speak Italian so I
5syt>) e(7j (tN Vloko(3 )
coudnt' talk to the secretary., So, I went to the bank. The biggest
bank in Italy., Because I used to lecture on American banking methods.,
And, oh boy, the Chairmant of the Board said he would help me., His office
was as big as this house., REally, You should see that carpet., Anyway,
they had magnificent closets. Amorie., I said, "This is my problem, I
got to get this money out of Italy," He said, "I can't help you there
because of the regulations," I said, "I've got to know who this guy is.
There is this guy over there and I don't know nothing.," So, he said,
"Come back tomorrow or the next day,. How long are going to be here?"
"As long as it takes you to tell me what I've got to do," He was very
nice to me,. So,,..,
D-So you are checking up on this head guy.
J-Yes., Right. And, so the secretary couldn't tell me anything. I figured
she was either in love with her boss. But the second level secretary
wanted me to take her out. She doesn't understand English and I don't
understand Italian and she wants me to take her out. Anyway, I've got
a meeting tonight, lots ofmen, So that blew that, I didn't' understand
what she was saying, so why should I take her out? Anyway, it was only
for dinner, no monkey business, believe it or-not, Now, if I know a
/ guy is monkeying, forget him. That everything he does, believe
me., I had two years of psychology,. Anyway, I went back to the bank the
next afternoon and of course the bank is locked up,. And they take me up
to the main office and says, "Have I got some interesting news for you,"
"He has two developments here himself, Nuove Florida, New Florida and
Nuove California, New California.," He's got two developments. How
the hell can he afford two developments., He said, "Well, in Italy, when
you are going to build a development, the government pays for everything.,"
They pay for the streets, the lights, the utilities. All you have to do
is build a house,. To get the money to build a house he is sleeping with
the owner of the property, the wife of the owner of the property. A very
.k H5 o I ,Nor
welathy optician on a two land street., Anyway where the hotel was., He
is making love to her about every night her husband is not here., That's
nice,. And she is supporting is efforts to do this development., Because
he's taking big deposits for us and putting them in the bank and just
sitting there. "How can I get this money?" He said, "I can't do it,
but you see so and so, c t" if so I go over
there and I talk to him and he says, "We can get this money through the
proper channels. HPw much?". Two percent. I can't believe this. I'll
tell you, that's the thing-with this world. So, O.K. Transfer all this
money to the Chemical Bank Trust Company in New York. I said, "I want it
to be there when I get back from telling this man he is finished." So,
// / ^^^vY\^^6 at vo ? ,cti- ik ^ ^r'lulkrA
"I had been in ,, I'm at the bank of This
guy, he was a jewel., I got the money out of the escrow account and put
it in Chemical Bank., When I got back to New York I fired this guy and
his secretary was crying because he was screwing her,, Now, she had no
money. And I left and he was telling me he wantedvto take her out. I
said, "Oh, Jesus, I should write a book," And I got back to New York
and the first ting I did, was I had taken all the ntras put.ofRome
with me and I had the,,., I went with C1erlie in-the international
division. And we wrote out cashiers checks to each one of these people.
( ^I k
We exchanged their dollars for ours and our dollars for theirs. And
I sent them lire so .they could just go to the bank and cash it, no
problem. So, that was that problem. They were putting out money that
they couldn't export., But I got the mofey back, That was great,.
D-So, you sent refunds back to all those.,,,.?
J-Yes., A million and two hundred thousand,
D-So, Gulf was serious about when funny business was going on, they made
.J-Yes, the state never believed us, But we made.,,,,. Yes, I remember when
there was a lady who had paid partly on her lot,.
D-Alright, let's make sure that we are O.K.
J--There was an elderly lady over in St, Petersburg who became indigent, and
the only thing she had kept her paymetns up on was this lot,., So, she
wanted to go into the homw they have for older people,, who have nothing,
They said whatever you have, you have to turn over to us, So she hadn't
paid for the lot, so she couldn't turn over the lot,, Leonard Rosen said,
"Pay it up, give her the lot, Give her the deed to the property," And
I had to deal with that., And I would do the same thing. I don't know
how many others, but just the ones that I had, thy got their money back,
And I know that Leonard now and then would do as I said., So, they did
a lot of altruistic things like that, And, like I said, when I saw the
grass on the ground, these guys can't be that bad. And they did have
some pretty rough salesmen., And I remember these girls were very, very
short in London. Selling lots and we had to get rid of that., So, I went
to London, I don't know why I was there., It wasn't particularly to check
them out., I think I was there because I was on layover on a flight.,
Mayber Zurich or Germany, I don't know. Another connecting flight, I'm
trying to think of why I was over there,, I don't know why. Anyway, I
said, "well, I'm in London, I'll go see.,..," Our London office.; So,
it's now almost 11:00., Almost lunchtime,, I go up there, Nothing, So,
Jim Lang was there at that time., Anyway, I came back at 2:00, nobody,
4:00, nobody, 6:00, nobody. What the hell is this? Nobody is here,
where are they? I don't know. The front desk didn't know, I said,
Well if I want to buy a piece of property who do I talk to? They said
to go down to one of the other hotels, they've got people., We were
paying for that, I forget if it was 15 or 30 thousand a week., A week.
And we wouldn't have been paying unless we were getting business from
there. Depended on how much business we were getting, they would get
a check. And I think that Pete fired everybody, There were guards
every place and salesmen are the worst, I discovered., Leonard, I don't
think trusted any of them., These people.,
D-But the state of Florida you don't feel basically they believed ya'll.
J-They didn't believe us and they weren't fair with us. And the office
in Washington, I don't think they were fair with us either.,
D-How do you mean?
J-They just wouldn't believe anything we said, And at the time it got real
nasty, G.A.C,. Corporation was in there, And they made every mistake in
the book, was running the place and somebody came in, he
would say, "Joe, take care of it.," He wouldn't bother, nothing., Nobody
came near him, And we would take care of it, He said, "Give them what-
ever they want, let them see whatever they want so they know we are not
trying to hide anything." G,,A,C, comes in and it's a whole different
ballgame., Frank Stephens calls me and says, "Joe, what do I do?" I
said, "Frank, find out what he want and give it to him." Gene Keriy,
the attorney for G.,A.C, comes up and says, "No,, You're not seeing any-
body unless there is an attorney present," Meanwhile the guy from the
government is sitting there, Listen to this,. Here we go,. I'm getting
out of here., So, then the lawyer comes in and he says, "You talk to
anybody in the company, I want an attorney present," This has never
happened before but he put down thes rules, What the hell does the guy
from Washington do? He says, "Let me read you the Miranda act,." I
went out. They dug their own grave, They want to come in nd they want
to-see a certificate, you show it-to them. V And totally showed it to
-511J 5 k a 'a" S I\ ) t ", IW llcai+^ O.
them. Leonard Rosen was always a-chum-with-anything- they wanted to see.
And we did., These guys were going to have a lawyer sitting there., No
way., That's why I stepped down,
D-Do you feel like when the land sales board was giving Gulf American such
a hard time, '66, '67, that area there, do you think taht there were
other corporations doing just the same thing that you guys were doing?
J--Oh, yes. They were going for the big ones,, They making a political
heaven for themselves, if you want to call it that, The big guys, David
brought down Goliath. That was my opinion,
D-Just the fact that Gulf American was the biggest? They just go after the
biggest and make a name for yourself politically,
J-They had a lot of complaints, but I'm sure they had it in General Devel-
opmenrt too. And we would make a diligent effort to clear up any complaint.,
S C 29
We would investigate it. If the guy said the person was wrong, he wasn't
there very long. I was not in sales so I can't say. Only what I know
happened. Maybe they thought the guy was no good in the first place,
I don't know. Maybe he was a cover up. I don't know. I just know that
when they wanted to know something from me, my whole office was at their
disposal. REally. In fact, when the government came in with G.A.C., the
scene I just told you, I just had got done using the Xerox machine on the
other, second, floor. At anytime he wanted to, he could have this space.
They changed the space made whefi you Xerox. What the hell? You know,
you don't' have to be an experienced cop to say, "Hey, what's this guy got
to hide?" But that was typical G.A.C. crap. Budget.
D--Oh, a question just came to me. Back to how they raised money and stuff,
were some of the acquisitions of a different company an attempt to raise
money. In other words, some people have said like the takeover of Fines-
tra, which was a Detroit based company, was actually just to get in their
cash. And was there any basis to that?
J--That I don't know. I do not know. I did not have much to do with the
Finestra deal at all. If we had taken it, I'm trying to remember
whether we took anything or not.
D-They, you went through, and then it was cancelled. The SEC or somebody.
I'd have to look back in my records.
J-You don't know that either. I didn't have anything to do with it. I
have no knowledge of it whatsoever. I just remember the name. Finestra,
that's a window.
D-They made building components. They also made some farm machinery and
a couple of things. They are based in Detroit. But the takeover was
fought for a while by the corporation and when they couldn't fight it
any more something happened. I can't remember. The SEC stepped in or
something. But that was the claim anyway.
J-I don't know. All I know is that if we had gotten it, I somehow would
have been connected with it.
D-Who do you think, besides Leonard and Jack Rosen, who do you think was
the most crucial person in the corporation? To help it succeed.
J--I can't answer that really. I can't answer that. For sales it would
be Jack for sure. After sales, in administrative was Leonard. And
Leonard had a bunch of guys under him like me and the treasurer and the
comptroller and we had some very fine, excellent accountants. Very fine.
It was my pleasure to work with them. And I know good accounting whenI
see it. We had some crooked guys in the accounting. There was one guy
who came in who was not there too long. But one of his first objectives
was to see the list of clients. And he sold them, a dollar a piece. In
one book there was 17,000 names. I don't know what the hell his name was.
He was a little guy. Once that got out, some of the other began to fig-
ure out how they could get their hands on the-stuff-, the book of names
too. See, you have crooks in all businesses. Somebody is going to find
a way to make a buck.
D-Did, was the thirty day suspension by the land sales board, did that
really cripple the corporation or did that not hardly have any effect?
Lt)/\r J < en \ V 5
J-It had an effect. I'm trying to remember where it was"effective. 5' '
D-It was just for thirty days.
J-It really didn't hurt the company, it would just quiet down sales. But
they would probably be out hustling because the next month, sales were
coming in like crazy.
D-Why did Leonard and Jack decide to sell? The corporation seemed to be in
pretty good shape financially and everything.
J--Well, the bottom line was 25 million. And that's what attracted the in-
tervention of G.A.C. But G.A.C. was trying to continue its fifteen per-
cent a year growth pattern and this would do it terrifically. That's
what they were looking at. It was a good cash flow. We were doing a hell
of a lot of work. If you fly over, did you ever fly over the developments?
D-Yes. Over Cape Coral.
J-How about Golden Gate?
I to.- VVI At'\ C
J- ,Canal is fourteen miles long out of the place. They used I
think 600,000 dynamite a day. This was an enormous project. I remember
the P sales the world's longest runways. You would fly out of
Golden Gate and look down those streets. They built those streets, or
what they call country roads there one night. They showed up white,
When you flew over them, you saw long streets, man. So, Finestra, I had
forgotten all about that.
D-So, the Rosens just decided that it was time to sell?
J-I think tht there was too much pressure on the Florida real estate board
"i !,, re
and the boys-up in Washington. They said, "The hell with this." I felt
that they had done their best to build up a big company. They made
available for a lot of people to own property. And, I can tell you this
that I know for fact, that the people who are in there now, they are
soliciting the all new property in Golden Gate, to sell their lots. So
that, I'm not sure of the amounts. But pricing i 15,000 for their lot.
II-lso would Wy three, four, or five thousand. They were sick and tired
of the hwld ting, sell. Those agents for Avitar turn around and sell the
goddam thing for 20,000. They are doing that now. This I know. Who did
I hear- it from? I have to check that out to find out where I heard it
from. It was given to me as a fact.
D-I wouldn't doubt it. ).,.
J-Oh, I'm sure. They tried desperately to sell the whole arl of Golden
GAte. V Because a friend of mine came and said, "What do you know about
this?" Nothing. I said, "I remember when they plotted it." And wen
they dug the holes in the ground. Did you know they dropped on6 level
in Goldne Gate fourteen feet?
D-I heard they dropped it an incredible amount, but I didn't know that they...
J-Fourteen feet. That's a lot of feet.
D-No wonder it's dry.
J--Right. That's exactly right.
D--People were not concerned. Ecology was not an issue.
J--It's the farmers who now have no farm. They used to grow melons there,
D-So, it lowered the entire water table.
J--Right. I know that for a fact because one of the guys, I can't remember
his name. I knew so many people that I can't remember rtjiir name. He
owned property there that he was selling two and a half to five acres
back. And I think it was all his land where we drilled. One there and
one up above-two oil wells. Did you know about that?
D--I heard about that, tell me about that.
Avcr hyctv*. ,t,- ^t-
J--Well, just a minute. When you beeS baeK, you will have a dry well. It
is not pourius sand. Are you familiar with oil wells?
D-Not very much. I don't know much about them.,
J--Well, I caution th monitors. This is Golden Gate number one. This was
taken from 11,700 feet. This is oil petrified in a rock. The museum in
Miami wanted this. They drill all kinds of wells out their now and then.
And they do pump oil out there.
D-Did they ever find oil there?
J-Yes. We found oil there, 10,000 feet and we'd find even more down below.
So, we blew out the well at 10,000 feet., Somewhere around ten or eleven
thousand feet they blew it out. And nothing happened. So, maybe it's
down further. So, they drilled down there and they hit this. When they
hit this,they finished-petrified oil in rock. Isn't that funny? This
was a big thing like this. I gave so many guys pieces. I kept two for
/ myself. I was going to take it down to the museum. f j wanted to do
it for me. To polish it. It's a beautiful piece. OC>O tLA(11S; '->/,(
D--So, the Rosens decided to sell. Did they sell out to G.A.C. just
immediately or did they look at several other possibilities?
J-I don't know. Leonard handled all that himself., I just did the tech-
nical things. Paper work. And that's the only one that I know of. In
fact, Leonard and Jack, Hepner, and myself, Bddry Herzfeld., I said,
"Hey, wait a minute., We've got stockholders out here." And I
said, "We've got to deal with thes6 diligence meetings." Ts Wall
Street coming back. Buddy Herzfeld said that's right, cheap counEil.
I said, yes. I said to make an appointment so we could go to talk to
them, so we all went up there. And they were so nice to us.
15 d c( k.
D-What went into diligence?
J--We had to go up there and see that the company exists,, what the business
is. Are they representing truly and honestly a financial position. And
just the general character of what we are going to work with. My question
was, "What changes will you make in management?" "Well, none that we can
think of because we don't know the real estate business." The were
small loan sharks And X taught that was great., vThey 'ade every wrong
decision that I can think of in the book. Number one: They never
interrogated out management. As to, what an you do for us if we come
in? What can we do for you? Never three "We will not change manage-
ment. So, after about six months, the dropped from 25 million to 5 million.
The second year we lost. 55 million. Third year we lost 95 million. Yes.
That bad. They were too interested in the business. And
they were going to build condominiums and high rises on Three Islands,
interconnect the islands with bridges, connect the islands to the main-
land. Si-' here we are going to get about 18,000 people withars going
to work and everything over those three bridges. ,Thy did not like that.
They thought of 18,000 trailers going., That had junk coming out of it.
Where was the sewage going? All these cars., All the pollution in the
air from cars., So, they voted no ,on all proposals,, Which flabbergasted
Wills because here he is coming in to make them a big town. Between
"U,. tL-n^ Get a map and see it. And they bought the
land from Alma. They overpaid it., They were in charge., 5 million went
to engineering alone., Drawing pictures and so forth. And what a pathetic
thing. And I kept saying to Jim Brown who was their man in our company,
he came in, I don't know., He went to another state after a hwile and
then they kicked him out. I was the last surviving senior officer to go,
And I said, "Why are you going? We are not a company for condominium
builders?" --Itd-had som experience with building one or two condominiums
there. You had to wait for people. The salesmen went after the thick of
that stuff. They really had a tremendous sales organization, but I sus-
pected they could learn very quickly because salesmen learn very quickly.
You drop a line about your Aunt Tillie in Peoria that might help them
sell another lot, They are magic people with words., Anyway, they would
never take any hints or nothing about what they were doing., They never
asked you, never, asked you for you opinion. They never asked me up there
for a meeting., What do you know? What do you think? I thought like
the land in Utah. You had to go to the end of the earth practically.
NObody around was in sight,. Four years before the bulldozer had pulled
over this road, a lot of bulldozer trails went over like a wave. No
rain, or nothing to help you flatten it out., So, you g o "I ,
you just go right thdr in the middle of the rod. Nobody, not even with
a telescope could see you. What a place. PO, thee was inventory.
We've got 4000 acres up there., That's seven square miles.
D-So, tell me about..,,
J-We need to get finished here. It's coming up at 5:00.
D-Yes. As soon as 5:00 rolls around.,.,.,
J--I feel as if I'm on the witness stand in court.,
D-As soon as 5:00 rolls around, I'm out the door., Tell me a little bit
about Leonard Rosen. What made him tick?
J--Leonard Rosen. I liked Leonard but he was a very profane n in some
ways. And I've seen him shatter people. he would shat-
-14I luAj .i ylI PoI I
ter them so easily. And I sawit one time. Whoever said that to me, I
would get up fr6m my desk and walk out. He looked at me like that, but
"I wanted him to know that he's not go ng at me. You've got
to let the other guy know.0' So, you react defensively.
But he never swore at me. Never said goddam you or anything like that,
never. Because I told him what, I did. I would. Because he wouldn't
hesitate doing it either. About his he was a very proud man.
Nine full inches, about that big. He had a telephone in the bathroom
and he'd take a bath. And when he was in there taking a bath, he was
lible to call you up. One day he called and myself. He
was in the tub. And I said to him, "What the hell, is that an eel
floating around in there?" Wise guy, anyway. Anyway, he was, I can't
really analyze him too much. He left me alone. He said to me, "Joe,
I want you to build me a bridge." So, I built a bridge one way or the
other. And what was the other thing? I want to go public, I want to go
public. That was the first thing that we got to go public with. So by
coincidence, the lawyers that he had in New York were very well known to
me because I was senior man in a bank on Long Island. Sid Freeman, the
head of the firm,was paying fbr-them. I wouldn't trust Sid Freeman from
here to that causeway to wash-them all away. But we got along. We'd go
public with him.
D--So, when Leonard decided that you were going to go public, basically you
had the ball rolling.
J--Total. Told him what he had to do. Leonard, we got to get the underwri-
ters down here to see this. They don't know what we are doing. They don't
have any idea. If they go to Flordia, they go to Miami Beach, they don'
go to the woods. So, what we did was we hired a plane and loaded up
about twenty of them or thirty and they came down. And-Coehn-and--o.
put together a program for them. First, take them around in a bus and
show them everything, then let them down in the afternoon when they are
all hot and bothered.
D--That was yours.
J--Yes. It goes up to 614. O.K.
D--So, you brought the underwriters down?
J--And we gave a pitch for about an hour and a half, answered all their
x)^lrAiCi.40 A-' ^
questions. -As-for-the answer Jft' the company, he was to do the financial.
And they asked me about the land if we were going to buy or what we have
bought. And they were very happy, so we opened it for bidding. HOW much
do you want? And we were registering 10 million dollars. That was the
first offer ing. And the reason we did that is because we've got 12 mil-
lion dollars worth of orders there. We had to cut back on some. Tom'Cc .'^
was fanatically happy. He said, "I never thought. Joe, I couldn't have
done it if it wasn't for you." When it was all over the underwriters
wrote in a bonus for me of 25,000. And Leonard said, "No, I'm not going
to give him a bonus. It's his job." So I didn't' get the bonus.
D--You did get it?
J--No. What was the other thing that I did? OH, the merger. When we did
the merger another 25 was wrote in for me and I didn't' get it. That's
D--Let me ask you something about the.... *. .S
J--So, let me continue. About a year and a half ago Harry Scbwatz called
me from preferred properties. He said, "Joe, we've got to have the
financial statements for 69 or 70." It was somewhere in the sixties,
after we were public. "I don't know where wecan get them." I said, why
don't' you call the compnay? He said, "I don't know if they would give
them to me. Don't you have the financials" I have only the annual
reports. He said, "Send them to me." I said, "I will not." I says it's
fifty dollars and hour. Send that to me and I will send them to you.
So he sent me fifty dollars an hour plus postage. I'll pay you. So,
I did. So, I wanted to tell you that. Oh, after that Leonard called and
he had been having a lot of trouble and he says, "Joe, I really don't know
when I was working with you what a great guy you are and what you did for
"Well, this is a hell of a time to be telling me. AFter it's all done and
gone, you are out there and having a good time and doing what you want.
I'm here and had to start all over when G.A.C. went broke. Don't bother
calling me for anything else because I'm going t charge you like you never
charged before. This is a hell of a time to cal me, especially when you
cancelled two bonuses of mine." But he gave me a bonus for building the
bridge. I told him I wouldn't do it unless he gave me a bonus. He said,
"What the?" I said, "IF you want the bridge built, call the engineer and
tell him to do it." Because I was ma'd that day for something."
"Iow about a couple thousand?"
"No, something reasonable." 'I said. "I just want a token of your appre-
"How about 5,000?"
"O.K. When will I get it? Can I have. 2,600 now?"
"When you build the bridge you will get it."
"Don't forget it." After the bridge was all built I went for my chebk and
he says, "What check?"
"The check for the bridge. We agreed to it Vhile it was being built, for
5,000"and he gave me the check.
D-He probably wanted to forget.
D--On the merger, one question that I've come up with. Iponard and Jack Ro-
sen were paid in GA.C. stock. Was there a restriction on whether they
could sell that orAhow long they had to wait.
D-They could have sold it any time they wanted to?
J--Boy, they took a bath on that one, as did I. I did something that I never
did before in my life and all the advice and co9ul would say never in-
vest in one company. And I did the oppostie. I invested everything
taht I was able to invest., Becasue I could see the stock going up and up
and I knew it was going. And the only guy that ever gave me a break was
the guy in Corpus Christi. He called me up and he had a lot of money in
the company. And I didn't know if Leonard was giving a lot of baloney
s3. or what. But I liked him. I had been to Corpus Christi on that Po04 'r' ("
thing. And I like the people there and this guy was really nice. So,
I gave him some advice, I forget what it was. I said, "No, don't sell
hold." I gave him my opinion. And he did, he held. His wife was a very
wealthy woman from San Francisco and she put a bundle into it. And I
said, "Oh, my God." Because I ahd never given anybody advice. I said,
"Dont buy." But here I am buying They-were stock options. I had
stock options. So, I'm trying to think of his name. But anyway, he
sent me a little note and he said, "I"m giving you a chance to buy 5,000
shares," I forget how many shares but it was for 5,000 dollars. So, I
bought them and I sold them later at substantially more than the price.
That was the only time I have anything from anybody and I didn't even ask
him for it, just out of the kindness of his heart. So, I made a lot of
money on it, I don't know. But I know that he had one hell of a bundle
in there and so did his wife. I'm trying to think of here/ maiden name. TA v
It's a well known name in San Francisco. I discovered later on. -When
we had our last security analyst meeting. See, I set them all up and
managed to squeeze myself in. You see, it takes sixmonths to get on the
list. You get on the list and you are marked up six months. I had a
guy on Wall Street and he would get me on before. So, we got to San
Francisco and Los Angeles in one day of each other. So, we went out
there and back. VHis whole family. And I was the guy who went down. I
got A on the Pacific Coast Exchange. So, I got in
to see them to see what they wanted to do or if they wanted to recommend q
specialist and so forth. And got that done with. And we had the meeting
in Los Angeles. And that was O.K. Then we went to San Francisco. In
San Francisco we were in the St. Francis hotel. The big one. Not the
one on t.v. It's the other one. It's by the park. Anyway, we went
there and the other hotel we were going to have this meeting was down
the corner and around the block, something like that. So we had a limo6o-+
take us over. And we were scheduled for 11 or 11:30 because of the tw6 /
hour difference. 12:00 here is 3:00 in New York and that's when the
stock exchange closes out there. At that time. Now, I think it's opened
until 4:00. So, I said to Betty, which way? I don't know. He's in his
"Hle is not. He's someplace else. Where the hell ishe?"
"Our suite and he's on the phone."
"What the hell is he trying to do?" He's trying to get the stewardess
on the National flight out, he's trying to get him-a-bet. I said, "What
the hell is this, we've got a room full of analystV down here. Don't
fool around with this?" So, he said "I don't know what the hell is the
mater with him?"
"You are his buddy, you ought to know what is the matterr4'r IJ 'r/ c.h < /,
So, he says, "I know."
"Well, it's not going to do here and I don't like it. \YOu are the very
person who can get him out of there because we've got to be there before
11:00. We only got an hour. You go in and tell him that we're going and
he should be yo6r right away." So he went in and said he's coming right
over. Let's go over, I said, "We better because we have got to be on
the receiving line., I set this up. I can't stay here. Whether you are
coming or not, I'm going oer. Do you want to come?" Ile said, "I'11 got
"Tell him once more to be there.," BAriy and I went over and we started
to say hi to everybody and the drinks were flowing and all the monkey
business, you know. And talked to 11:30 and no Rosen. I said, "This is
bullshit. These guys have got to get out of here by 12:00. The market
closes and they are going to be busy from 3 to 3. 12 to 3 here because
the market's opened until 3 there." Screw them. I'm looking at the door
every second. No Rosen. The guy said, "Mr. Rosen is busy, he'll be back.
Hie's in a meeting." We were bullshitting you know. So, we had lunch.
I had roast beef for lunch and NO Rosen. Almost 15 or 10 minutes to 12.,
lie comes walking in and says, "how's everything?"
I said, "What the hell are you talking about? These guys are ready to go
home. They've got a and we had lunch and I guess it
was about 10 minutes to 12 and he starts in with this conversation and
by this time the guys were aboht to leave., They were going out the door.
They have got to get to theri office. Anyway, it was a disaster. He
never got the work-doare. So, on the way back I went to talk to him. He
said, "what the hell is the matter?" I said, "Leonard, don't bother me
today. I'm not in a good mood."
I. r, eX AL P -e (0 '
"O.K." As if he cared.V "I'm letting you know this is the last security
aC ^j5 meeting I will ever attend. You can take them over. You
can do whatever you want, no more. And that was the last one. You co s cn
scared me twice friend. That was the deal with Wall Street and the stock
never moved the two weeks after that., Because Rosen was in San Franciscp
telling everybody he was in New York. Who the hell was this guy? He's
got a meeting for an hour and he comes up for five minutes? And that was
part of his Leonard-before business., That was the one thing
that was wrong with it, Leonard Rosen. Oh, here's I
..^ l 1 tV; "'C 41
hardly recognized him. He ,ir Nevada. I didn't read
tiS. Did you read this? Nevada Agency was investigated for violating
D--I'll have to get a copy of this. I'm going down to Ft, Myers.
D--Yeah, May 25, 1966..
J--Yes, hers' another part of it.
D-I'm just going to turn this off if that's o.k. I think we are pretty