Free A Bright and Guilty Place: Murder, Corruption, and L.A.'s Scandalous Coming of Age by Richard Rayner

two-gun man.”
    Lewis and Berman kicked the Julian Pete into another gear, intent on fraud from the start. The swindlers stepped in, bought brokerage houses, and invited celebrities and rich investors (shakers and movers like Charlie Crawford) to form privileged “rings,” boosting the stock they then watered. Over four million shares were sold at a par value of $200 million. Punters were gullible, and besides, this was one of those times in American economic life when it was possible to buy into a scam and still make money—so long as you got out in time, or were on the inside.
    Some 40,000 Angelenos—high and low, and almost everybody in between—invested in the Julian Pete. Local reporter Guy Finney wrote: “They knew their city was galloping along at dizzying speed. The easy money carnival spirit gripped them. They sang it from every real estate and stock peddling platform, in every glittering club and café, in banks and at newsstands … The dollar sign was on parade. Why marvel then that like epidemic measles among the young it spread from banker to broker to merchant to clerk to stenographer to scrubwoman to office boy, to the man who carried his dinner pail … The mass craving wanted its honey on the table while the banquet was on. It simply couldn’t await a soberer day.”
    A single word explains this story of a city gone nuts: oil. In the 1920s L.A. was primarily an oil town. Oil derricks rose high in the middle of major boulevards while nodding donkeys dotted the hillsides. Thirteen hundred or so oil wells operated throughout the Los Angeles Basin, in places “as thick as holes in a pepper box,” producing scores of thousands of barrels a day, one-fifth of the world’s oil output at that time. Amazing.
    A 1923 photo of Signal Hill in Long Beach shows hundreds of oil derricks bristling above a few blocks of California bungalows. Water, and the theft of water, allowed L.A. to grow, but oil was the bonanza. Oil promised swift and transforming wealth. Oil created Los Angeles as a plausible business hub and prompted the development of an industrial base that would later manufacture much of the world’s aircraft and automobile tires. Promoters ran bus trips to the oil fields where salesmen bore down bearing “sandwiches, cookies, and huge cups of coffee,” according to the Saturday Evening Post (in the central part of a 1923 series about the L.A. boom titled “Mad from Oil!”). It was the free chicken dinner school of finance. People bought oil stock because they saw derricks and wells and blowouts right there in their backyards. “It was like drilling for oil at Fifth Avenue and Forty-second Street in Manhattan,” said one Texas oil man. Lawns and parks and houses were constantly plowed up so new wells could go down. Homeowners banded together to sell their properties to big developers. When Upton Sinclair wrote his 1927 muckraking novel set in the city, he didn’t call it Movies!; he called it Oil! Nobody wanted to be bothered with memories of struggling, frugal days. “Little people were suddenly seized with the vision of becoming big people and were driven half-crazy with a mixture of greed and fear,” said Sinclair’s wife, May Craig, observing the madness. “We were right in the center of an oil cyclone.”
    The Julian Pete grew and grew until on Friday, May 6, 1927, the inevitable happened. “This hapless May day … expressed by the nature of things in Los Angeles in the serenity of sunlit skies and outward peace … saw the Julian Petroleum stock mirage crumble to earth … saw one of the most spectacular and unreal promotional dreams ever fostered in the great, upclimbing Pacific Coast go into swift eclipse … saw frenzied stock gamblers, conscience-heavy bankers, wide-eyed, anxiety-driven business and professional men running around in fear … saw an explosion blast more than 40,000 stockholders who unwittingly had dumped their savings on the swindling bonfire,” wrote Guy