Savannah morning news. [volume] (Savannah) 1868-1887, 1882-12-21
KEENE ON CORNERS"
THE GREAT OPERATORS oPIN
IONS.

Merchants not Hurt and Farmers Rep.
efited-The Coal Combination-water
ing of StOcks-Futures Neeessarv-I.e-
gitimate Transactions as Distinguish
ed from Gambling.
Neao York Special TO Philadelphia Press 1871
Inc leading witness before the State
senate committee on corners and futures
at the Metropolitan Hotel this afternoon
was James r. Keene. In resnonse tn tbs
| question whether he knew anything about
| corners, he replied: ~ never knew
corner in any commodity that
worked an injury to business
ana property since came
10 New York, except one, because all cor
ners that have been made in breadstuffs
nave existed so short time that no injury
mas been done. Had they been continued
| they might possibly have hurt commerce.
On the contrary, the agricultural interests
nave been benefited and the damage has
fallen upon the promoters of the corner.
As SAID, never saw more than one
corner that did HARM"
''What corner was that, Mr.. KeeheYv
'sThat's the corner which at present
exists IN coal, an arrangement between
the anthracite coal companies to keen uD
the price, which bears heavily on all con-
sumers. 1t originated out of the neces-
slty of the corporations who are burdened
with excessive debts and enormous stocks
and who had to resort to that means to
pay the interest on their debts and diei-
dends on their stocks. 1t has been con
tinued for long time, and, of course, the
public have been compelled to pay a great
deal more than they ought for these arti-
cles."
no are the persons who originated
this cOrnerY' 'erhe heads of the coal
companies" Mr.. Keene answered, sswho
perhaps have done what others would do
to help their companies, though at the
public expense. There have been so much
expansion and watering of stock that 70
keep their heads above water they have
been obliged to combine, as have said.''
"Will you explain what watering stock
meansY
WHAT WATERING STOCK MEANS.
"Watering stock means increasing the
capital without giving any equivalent
therefor. 1t also means the private pur-
chase OF property by persons interested in
a corporation at one valuation and the
selling of that property to the corporation
at large advance, when the capital does
not get an equivalent"
''TO what extent has the system of wa
tering stock been carried on by the heads
of the coal companies%'
81 don't know that l could cite any in
stance so far as coal companies are con-
cerned, except as they were compelled to
increase their stock and bonded indebteda
ness to pay expenses. l don't know of
any increase of capital stock by them ex-
cept under that pressure.''
''EXplain how they made their cOrner.''
''They combined together TO fix the price
of coal. and agreed arbitrarily to maintain
1t; consequently it is practically a corner,
and coal is selling at 81 per ton at tide
water more than the companies should
sell it for, with due regard to the inter-
ests of the public. 1t is selling for almost
twice as much here as it is in England.'
what is your opinion Of the system
of dealing in futuresY'
THE NECESSITY FOR FUTURES.
81 don't think the commerce and busi-
ness of the country could be carried on
without that system.v Mr.. Keene was
asked what he thought of the testimony
of 5. d. c. Bokkelin, keeper of a place
known as the Public Produce Exchange.
where any one could buy and sell futures
in grain and provisions for q small or
large amount, and the effect of such
a business upon the public welfare.v
He replied: Il should think it was
rather demOralizing in its effects. Inas-
much as there is no 'pretense to make
deliveries, it resolves Itselfinto gambling.T
| consider business of that kind pure
gambling. In not defending gambling.
and as there is no element of business in
it, do not consider myself competent to
answer the question. l should think
it was the duty of the lawmakers to abol-
ish that system of doing business
eff man buys future in Chicago
Mr.. keene went ON, ''and contracts topaz
the money ON delivery, he must take it il
he makes it an absolute purchase. If
buy one hundred shares of stock at the
Stock Exchange | must pay tomorrow. L
may sell again, but that is separate
transaction. If l buy 100000 bushels of
grain in Chicago for delivery mex
month, L must take it. may
in the meantime sell it out, but that ia a
separate transaction. ! think the COM
mittee labor under the idea that dealing
in futures is a mere gambling transac-
ton, and that we don't buy an article out
right; but we do. In the transaction as
narrated by the gentleman here there is
no transaction because there is no Obliga-
ton made requiring the delivery or ac-
ceptance of grain. 1t is mere gambling.