By late summer, Gertrude's doctor had changed his diagnosis. He called Cayce aside and spoke the awful truth: Gertrude had tuberculosis and was dying. A TB specialist confirmed that nothing further could be done. Everyone expected her to die by the end of the year except for her husband. Not knowing what else to do, Edgar gave a reading. While in the sleep state, he recommended a combination of prescription drugs as well as filling a charred oak keg with apple brandy.
Gertrude was to inhale the fumes to clear up the congestion. Although the doctors claimed that the combination of drugs would be useless, Dr. Ketchum wrote the prescription anyway. After following this treatment for only two days, Gertrude was feeling better and her fever had fallen. By September she was better still, and by November even her doctors decided that she was going to get well. By the first of January, , Gertrude Cayce was fully recovered.
That same year, a delegate from Harvard University, Dr. Still, Edgar was happiest being a photographer and he decided to dissolve his partnership with Ketchum, his father and Noe and he obtained a job as a photographer in Selma, Alabama. The following year, he bought for himself the studio where he had been employed. In Selma Cayce was able to escape from the readings' notoriety and live out a quiet life.
The quiet normalcy of life did not last long. One day his son, Hugh Lynn, was playing with flash powder in the studio and severely burned his eyes. The local doctors gave no hope that the boy would ever see again. In fact, they recommended removing one of the eyes due to the extent of the damage. Cayce decided to give a reading instead. During the course of the reading he gave assurance that sight was not gone. He recommended an additional compound to be added to the solution that had been prescribed by the doctors and stated that Hugh Lynn should remain in a darkened room for two weeks with his eyes bandaged.
No eye surgery was performed and when the bandages were removed, the boy could see. Local newspapers picked up the story and again, Edgar Cayce's fame grew. In addition to his job and his work as a Sunday school teacher, he began giving readings. On February 9, , Gertrude gave birth to another son, Edgar Evans. As his psychic reputation grew the request for readings continued and Edgar Cayce was faced with a problem. Although people were being helped by the readings, many were having difficulty finding doctors to carry out the treatments that were being recommended.
Doctors seemed hesitant to follow the guidance of a sleeping psychic who, in many instances, had never even seen the people he was diagnosing. This situation led to Cayce's dream of a establishing a hospital, staffed with fully qualified doctors, nurses, and therapists, who would carry out the treatments recommended in the readings. This pursuit of a hospital caused Edgar Cayce to form an ill-fated partnership with others who were seeking oil. He went to Texas to give readings on possible oil sites but was repeatedly disappointed.
The readings made it quite clear that the information was never to be used for financial gain and that some of his partners did not share his dream of a hospital.
Some of his partners wanted money only for themselves. After many failures, Cayce returned to Selma and picked up where he had left off. He had his wife, his two sons, his business, and the church. His Sunday school classes became the most popular in the county because Cayce had the ability to make the Bible come alive. In the fall of , he hired a secretary, Gladys Davis, to take down the information in the readings while Gertrude conducted and asked her sleeping husband the questions. Until most of Cayce's readings were limited to medical and physical conditions. However, that year a printer from Dayton, Ohio, who had obtained successful readings for two of his nieces, asked Cayce for a horoscope reading.
Toward the end of the reading  the sleeping Cayce spoke the curious sentence: "he was once a monk. There was no doubt that the information was helpful and accurate when dealing with health, but the readings matter-of-fact reference to reincarnation seemed foreign to his fundamental Christianity. He prayed about it, did much soul searching, and obtained a few readings.
He was advised to read the Bible once through from cover to cover while keeping the idea of reincarnation in mind. The underlying philosophy that emerged was one that focused upon the oneness and the purposefulness of life. In time, Edgar Cayce found that the concept of reincarnation was not incompatible with any religion and actually merged perfectly with his own beliefs of what it meant to be a Christian.
Soon afterwards, the "Life readings" were developed, dealing with an individual's previous lifetimes, as well as the person's potential and purpose in the present. In time, the topics in the readings were further expanded to include mental and spiritual counsel, philosophy and contemporary spirituality, meditation, dream interpretation, intuition, history and ancient civilizations and even advice for improving personal relationships.
Because the requests for readings continued to grow, Cayce gave up his photography studio and began looking for financial backing for his hospital.
He also began to accept donations for the readings, but he never refused to help those who were unable to pay. Over the years, several backers were found to make Cayce's dream of the hospital a reality. One group wanted to locate the facility in Chicago, another wanted it to be in Dayton.
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However, time and again, the readings advised that the hospital needed to be located in or near Virginia Beach, Virginia. Finally, a New York businessman named Morton Blumenthal agreed to finance the hospital project. Its purpose was to research and experiment the information contained in the readings.
Patients came from all over the country to obtain readings and to be treated by a qualified staff composed of doctors, nurses, and therapists. The sleeping Cayce gave each patient a reading, diagnosed the ailment, and recommended everything from a change of diet to surgery. Cayce's approach was that healing worked best when all the schools of medicine worked together in cooperation, finding what was best for the patient. In spite of the stock market crash in October , a university, "Atlantic University," was also underwritten by the hospital backers and opened in the fall of Until the hospital operated successfully.
In the midst of the Depression, however, financial backing was lost and the hospital had to close its doors in February.
The University survived until Christmas. This organization became interested in such things as holistic health care, the workings of ESP, meditation, spiritual healing, the importance of dreams, and the study of life after death. When individuals asked Edgar Cayce how they could become more psychic themselves he responded by saying that the goal should be to become more spiritual, "for psychic is of the soul.
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Rather than trying to find converts to the readings' philosophy, people were told that if they could incorporate information into their own religious and belief systems, enabling them to become better people, it could be a useful and positive experience; otherwise they were advised to leave the information alone.
As the years passed, Cayce became more and more psychic in the waking state as well. He once fled from a room in sorrow because he knew that three young men would not be returning from the war. He also had developed the ability to see auras, which are fields of light that surround all living things. From these auras Cayce could perceive people's moods as well as their overall physical condition.
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As his fame as a psychic grew, so did the number of skeptics. Many people came to Virginia Beach to expose him as a fraud, but in time all were convinced of the legitimacy of what he was doing. A number stayed in Virginia Beach and received readings for themselves. One staunch Catholic writer, named Thomas Sugrue, came to Virginia Beach to investigate what he thought had to be trickery and ended up writing There is a River, Cayce's biography published in while he was still alive. Coronet magazine, one of the most popular of the era, sent a reporter to investigate.
The article, written by Marguerite Harmon Bro, "Miracle Man of Virginia Beach," drew widespread attention, and Edgar Cayce became more famous than he had ever been before. During the height of World War II, sacks of mail were delivered to Cayce with ever-growing requests for readings. Despite the readings' warning that he should give no more than two a day, Cayce began giving eight in an effort to keep up. Gladys Davis' appointment book had readings scheduled two years in advance! In the spring of , Edgar began to grow weak.
His own readings advised him to rest, but he felt a tremendous obligation to those who were asking for his help. Finally, he collapsed from sheer exhaustion, and just as he gave his first reading for himself, he gave his last reading for himself in September of The reading told him he had to rest. When Gertrude asked "How long? By the end of the year his friends feared the worst. Although Edgar told them he would be healed after the first of the year, they understood what he meant and he died on January 3, At the time, no one really understood how ill Gertrude was, yet within three months, on Easter Sunday, she died as well.
Gladys Davis took it upon herself to preserve the information she had taken such great pains to write down, until Edgar's sons returned from the war.