Russell Sage was an American financier who played a part in organizing his country’s railroad and telegraph systems. Born on August 4, 1816 in Verona, NY, Sage’s first job was as an errand boy in a brother’s grocery store in Troy, New York. In his spare time he studied bookkeeping and arithmetic, and he began trading on his own. When he was 21, he used his profits to buy out the store of his other brother, Elisha Montague Sage. He sold the grocery store to open a wholesale grocery business in Troy in 1839 and made enough money to start a Hudson River shipping trade in groceries, meat, grain, and horses.
As a delegate to the Whig Convention of 1848, he supported Henry Clay. He served two consecutive terms in Congress (1853–57). Sage had lent some money to the La Crosse Railroad in Wisconsin. To save his loans, he advanced more money and, in 1857, he became vice president with a major share of the stock. When the railroad extended into the Chicago, Milwaukee and St. Paul system, Sage made a profit on his investment.
In 1863 he moved to New York City and gave his attention to stock and finance. He also helped, along with his ally, Jay Gould, to organize the Atlantic & Pacific Telegraph Co. In 1872 Sage originated stock market “puts and calls,” which are options to buy or sell a set amount of stock at a set price and within a given time limit. By manipulating securities, he and Gould gained control of the New York City elevated lines in 1881. Sage lost on the stock market only once, in the panic of 1884. He lost $7 million and never again dealt in puts and calls. Toward the end of his life Sage was also a moneylender with as much as $27 million loaned on call at a time.
In 1891 a man named Henry Norcross threatened to explode dynamite in Sage’s office if he was not paid $1.2 million. Sage refused and survived the explosion, which killed Norcross.
Sage’s fortune at his death was estimated at $70 million. The Russell Sage Foundation was established in 1907 by his widow (his second wife), Margaret Olivia Slocum Sage (1828–1918). She also founded the Russell Sage College and built a new campus for the Emma Willard School, both in Troy, New York.