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CHAPTER THIRTEEN The Perils of Prosperity Mitchell’s conflicts with white Richmonders during the 1910s came about largely as a result of his efforts to make his bank profitable. Like most black financial institutions, the Mechanics’ Bank was small and undercapitalized, a depressing reality that no amount of cheerful rhetoric about business success or annual visits to ABA conventions could camouflage. As late as 1910 the bank’s assets (paid-in-capital, surplus, and undivided profits) were still under $35,000. Total deposits did not reach $100,000 until 1907, and another decade passed before they reached $200,000. As Mitchell realized, a bank with so little money could not pay employees’ salaries, maintain a bank building, pay interest on deposits, and at the same time issue regular dividends to stockholders . The black community also lacked the commercial and industrial enterprises that form the basis of most banking business. Banks make money on loans, not deposits, and he had to find some way to invest the money that was accumulating in his vault.1 Mitchell concluded early on that the Mechanics’ Bank could not operate profitably until deposits reached half a million dollars, and he set out to build confidence in his institution. He knew it imperative that the bank appear solid, substantial, and secure. The bank at first operated out of Pythian Castle Hall, but he was convinced that a more impressive building would increase deposits. His original plan was to renovate the furniture store on Broad Street that he bought in 1905, but in 1908 he purchased property on the northwest corner of Third and Clay Streets and resolved to tear down the existing building , which was in poor condition, and erect a new banking house. A white architect drew up the plans, and D. J. Farrar, a black contractor, agreed to oversee the construction. The four-story brick building would have offices on the upper floors available for lease to doctors, lawyers, and business leaders, making it a center of black commerce.2 By 1908 he had also settled on an investment strategy. As he later conceded, he knew little about stocks, bonds, and securities and was reluctant to entrust the bank’s assets to New York financiers. Ordinary loans generated little income . He began instead to invest in real estate. Making use of the mapping skills he had acquired as a high school student, he drew diagrams of various neighborhoods and charted the prices of houses and commercial property. Richmond was experiencing a real estate boom, and property changed hands rapidly. Although the race had been systematically shut out of the world of finance , he felt certain he understood the real estate market and that his instincts were sound.3 Mitchell had a good grasp of the real estate market, but his very success got him into trouble. His problems came about in large part because of demographic changes that were taking place in Richmond in the early years of the century. The city’s black population had remained stable during the 1890s but between 1900 and 1910 increased by 45 percent as rural blacks migrated to urban areas in search of jobs. Women found work in tobacco factories, took in laundry, and worked as domestics, while men did much of the city’s hard labor. As the black population of Richmond grew, the neighborhoods of Jackson Ward became increasingly crowded. Single-family homes were subdivided into apartments, families took in boarders, and jerry-built houses appeared on back streets. “There is hardly an alley in what is now old Jackson Ward, which has not been dignified into a so-called street by the erection of houses, and rented at good prices,” complained one resident. By the 1890s white Richmonders had begun their move to the suburbs, but blacks found themselves trapped. Hemmed in to the north by Shockoe ravine and to the east by the whitebusinessdistrict,theybegantopushsouthandwestalongClayandLeigh Streets—only to find themselves in conflict with white property owners.4 To make matters more difficult, the area of Jackson Ward lacked basic municipal services. “If you wish to understand the effect of colored folks retiring from politics,” said Mitchell, “walk around in old Jackson Ward and then walk over [to] . . . the western sections of the city. You will be astounded to see the difference.” Health officials warned of the dangers of disease, while in the Planet, Mitchell described dusty alleys, cesspools of filth, and crowded...

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