Just as with any business, there is a history. Where it all started, how it started and how it became who they are today. Long before the first "Welcome to Cooper Music" ever chimed the ears of a piano buyer, the history of the Cooper Family began. For the next few months, I will share with you, every Friday a special blog, containing the history of the Cooper family and creation of Cooper Music. We hope that you enjoy reading as Cooper Music is brought to life with memories.
THE GREAT DEPRESSION IN
NEW KENSINGTON PENNSYLVANIA—
BROTHER CAN YOU SPARE A DIME
October 1929 the stock market crashed, wiping out 40 percent of the paper values of US common stock. The overconfidence and speculation of the twenties became the nightmare of the thirties. As the confidence evaporated, people in the nation, western Pennsylvania and Cooper Music faced the loss of a lifetime of work and savings.
During the big twenties boom in player pianos and phonographs, Cooper Music expanded their business, constructed their beautiful new 810 5th Ave building, and purchased stock in the local Community Savings Bank. Through credit lines at the Bank, Coopers guaranteed large amounts of customer installment accounts for purchases of pianos, phonographs, and musical instruments by assigning the accounts, with recourse, to the Bank. The Depression weakened Community Bank had there own problem, it was acquired by Logan Trust then later by Mellon Bank.
By 1933 the value of stock on the New York Stock Exchange was less than a fifth of what it had been at its peak in 1929. The Coopers’ Bank stock was worth even less. Logan Bank, then in control of the Community Bank, blockaded Cooper offers to sell their stock for any price. Business houses closed their doors, factories shut down and other banks failed. By 1932 approximately one out of every four American workers was unemployed. Local industry in western Pennsylvania was almost at a standstill. If workers at Aluminum Company of America in New Kensington had a job they were cut back to two or three days work a week. Real estate values collapsed. The Cooper Music building, only a few years old, with a modest remaining mortgage balance, became a foreclosure target. The Bank, even in the face of depressed real estate values, foreclosed on the Mortgage because the remaining balance was so low. The Coopers, unable to pay, lost the building and faced unannounced eviction at any time.
Leading bankers believed, “It is in the national interest to liquidate labor, liquidate stocks, liquidate businesses, liquidate real estate…..That will purge the rottenness out of the system," said Andrew Mellon, ( Hoover “Memoirs” 3:9). Hoover rejected the advice and tried to keep wages high and public works going to ease the distress—but it only got worse. Small business people had choices that were small or none. Cooper Music credit lines, collateralized by devalued real estate and devalued customer installment loans, were declared in default and due in full. The building was repossessed.
The hard won equity in the music business was expedient in the bankers’ view. It was an economic battleground. No Cooper asset was left unturned by lenders, intent upon turning any remaining assets into cash for repayment. The Bank shamelessly drew down cash from the Cooper Bank Account to cover delinquent customer payments by way of recourse to the Bank.