Life on the Corner: What’s the Vig?

We’ve all seen pictures of Paul Revere’s house and know how it evolved over the years from the patriot’s home to a tenement housing Italian immigrants and finally a museum and one of the main tourist attractions on the Freedom Trail. The postcard I’m sharing today is another picture of that familiar house probably taken soon after it was restored in 1908. There is a group of well-dressed Italian men and children posing in front of the house.

Today, I want to focus your attention away from the Revere house to the building next door, the one with wood cladding and an exterior fire escape. This building was owned by Raffaele DelGaudio who had a watch and jewelry store and is still owned today by his grandson, Ralph DelGaudio.  The DelGaudio family has owned this building and store for over one hundred years. I’m not sure if this is a North End record but it must be one of the oldest local businesses that is still in the same family.

Today, Ralph has a gift shop there but when his grandfather’s day it was a jewelry store and served a very different function in the Italian/American community. To the left of the picture window is a display case with watches and clocks. These were most likely the less expensive items because inside was where he kept his most valuable items, the solid gold pocket watches and other gold jewelry.

1908-1912, shortly after Paul Revere’s House was renovated.

Imagine living in a world where virtually all transactions were conducted in cash, a world without credit or ATM cards and a world where it was almost impossible for an Italian immigrant to obtain a conventional loan. That was the world of my parents and grandparents in the North End.

These early Italian immigrants needed access to money. They had rent to pay, children to feed and businesses to support and an entire shadow industry evolved to address this very important need for cash. One would first try borrowing from a relative or friend but if that didn’t work there were many loan sharks on Hanover Street willing to supply cash for a price. The vigorish (interest or “vig”) could be more than 10% per week and the collateral was your continued good health. I like to think of it as an early form of peer-to-peer lending but with an edge.

Loan sharking was one of the principle sources of revenue for organized crime but many legitimate businessmen also loaned money to friends and associates as a profitable side line. We used to joke that most of the restaurants in the North End were financed through this alternative banking system. Collecting could be problematic but loans could always be sold at a discount to someone with special expertise in collections. It wasn’t a perfect system but it worked, cash was always available for a price and the North End prospered.

Other sources of cash were the jewelry/watch stores like the one illustrated here which functioned as quasi banks or pawn shops. Italians loved gold jewelry. When times were good they bought it and sold it back during lean periods. They also engaged in a simple kind of arbitrage, buying watches and gold chains in Italy and selling them in America for a much higher price. When I was young Ralph’s uncle Frank ran the shop illustrated here. Frank was widely respected in the North End for being both honest and discreet. He was also a very good friend of my father.

When I was about ten years old my father asked me to take a walk with him to Frank’s store because he had some business to attend to. When we arrived Frank ushered us into the back room, a small, wood paneled area with a stove and a coffee machine. I was surprised to see three police officers there drinking coffee, two sergeants and a lieutenant. I thought this was odd because you rarely saw police brass around the North End but Station 1 was just a block away and I figured this was where they got out of the cold. Frank introduced my father to one of the sergeants and they talked quietly for several minutes. On our way out my father gave Frank a sealed envelope and we walked back to his tavern on Lewis Street. I could tell my father was quite pleased with himself and a problem was solved. I never found out exactly what transpired in Frank’s back room but I have a pretty good idea.

Nicholas Dello Russo is a lifelong North Ender and columnist. Often using vintage photographs, Nick tells the stories of growing up in the North End along with its culture and traditions. It was a time when the apartments were so small that residents were always on the streets enjoying “Life on the Corner.” Read more of Nick’s columns.

8 Replies to “Life on the Corner: What’s the Vig?

  1. In addition to residents getting loans from businesses ,residents could get from many stores & shops groceries & products “on the cuff” meaning w/o money out of pocket.

  2. My mother and father lived on fourth floor above DelGaudio jewelry store for 40 years,great landlords and friends. Raised the rent maybe twice, started at $18 a month to $40 at the end.I think I’ll hit up Ralph for a loan.

  3. Great story as usual Nick funny how we live here all our lives and we don’t know the story behind the story i don’t think Ralph has his communion money ?i go by there all the time Ralph is generous with me i think because I knew his mother Virginia as they had a jewelry store in town for a short time. Nice lady anyway Thanks Nick always look forward to your stories for sure!!!

  4. Love your writings. I remember many of the people you write about, great memories. I remember your dad very well. Your dad helped me get out of trouble with one phone call to station one. It was great living in such a close knit community. Keep up the good work.

  5. Great article. My uncle Frank was the man and Rosie was known all over the North End. She was amazing. We are history there and we always will be. Thank you for writing this.

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