New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1893-07-27
FAILURES ON THE EXCHANGE.
H. l. NICHOLAS & co. AND JOHN b. DUMONI
GO UNDER
THE LIABILITIES OF THE FORMER ABOUT
MILLION AND A oUARTER-THE FIRM

TIE LIABILITIES OF THE FORMER ABOUT A
MILLION AND oUARTER-THE FIRM
LIKELY TO PAY EVERYTHING.
When the bears on the Stock Exchange were
working their hardest to depreciate the price Of
stocks and in response to their efforts the market
was going of one two and three points at a
Jump, business was temporarily suspended by the
rappng of the chairmans gavel. The bears
rushed toward the rostrum with shout OF en-
ultation to hear what the chairman had to
say and TO learn the name Of the firm that was IN
trouble Many men turned pale, however, when
they heard the gavers rappings, for they did not
know where the trouble might strike. There was
a dead silence on the floor when the chairman
announced the failure Of H. !. Nicholas & Co.,
well-known and popular firm Of brokers. Inc
firms offices are at No. IL Wall-st. and thither
went score or more of the men anxious to learn
the extent of the failure
No one had TO be told the cause Of the sus-
pension. That foregone conclusion, and II
Justly laid to the inability of the firm to
raise money on It's securities 20 meet pressing
demands, and the failure Of customers who had
been trading on margins TO meet the demands
| made upon them. These were The immediate
causes Of the failure. Later in the day it was
financial straits. Nothing could be found out at
the firms office. All seekers after information
were referred TO William Nelson Cromwell, the
lawyer, at No 4j Wall-st., who is the assignee.
At this office the following statement was obtained
from Alfred Jaretzki. one Of the members of the
law firm
The obligations OF IL. l. Nicholas 4 Co. will amount
to about 81 10000 This firm has been doing a
general brokerage business for some time,
|
sochs. AmoGs these S,oshs ,, we're r. those
chaso s and a cesSo Tr and st. Paul.
Evansville and Tcrre Haute, Manhattan Railroad,
Mobile and ohio and many other OF the best stocks
In The country. think that the collateral Is splendid
paper and II the creditors will not become frightened
and sci. IL out | am that they will receive 100
cent, on very dollar which the firm owes them.
The assets which Nicholas 4 CO. have are worth at least
| l. Ip.r cent than the amount OF the company's
iIaltlitles and as most Of their securities in the
Iii 'i them % "l of ' now, but but will Walt awhile goes
without saying what the cause Of the failure was:
and more margins were wanted. but the firm could
| not rail-" funds TO meet their obligations TO cover
their margins. Their inability 10 cover their margins
mainly 10 the failure OF customers to respond
To the demands for more money to cover the margins
/ which the firm compelled to meet. The c'n-
tracts on the stock Exchange are very few In fact in
/ significant In character. ana nope that We VIII DE
able shortly put the company on Its feet again.
All sorts of rumors were in circulation to
what was really behind this failure. II had been
known that Nicholas < Co., like many other
funds they wauted on their securities, but il
WAS not thought that this firm was anv wors"
of in this respect than many other houses which
are carving stocks for their customers margins
One rruor had il that Nicholas * Co. ha been
too heavily loaded up with Evansville and Tcrre
! IIante stock When some of the firms stock
WAS sol on the Exchange TO cover call loan
for $4,000 this stock was sold down from
1926 to -.
| II was denied however that the stock Of the
Evansville and Trrrc laute which this company
carried had anything II do with the failure
The falling off of fifty points due
principally TO the fact that the Evansville and
rcrrr Ilautc stock is not traded in TO any cX-
tent on the Exchange, and when the stock WAS
put lp for sale there on hand WHO
wanted to buy it, W. Woodward Baldwin, the
attorney for the Evansville and Tcrre IIautr Rlil-
road. sail
The failure of H. T. Nicholas n Co. was in no
way dur 10 their relations with the Evansville aud
Teri, lIaut" Railroad The connection between
them and the railroad is slight. When tn, firms
demand upon this company for a small amoun,
Of money some 100000 was made, it was mot
hy prompt tender of cash. The roai is absO-
ucly solid, and recently declared dividend of
! ! o per cent which j. due on August | ="
Later it was learned that the reason why the
firm was short Of money its connections
with the Mobile and Ohio Railroad Company. Ii
WAS said good authority that Nicholas & Co.
was Of the leading houses in
n syndicate which had been formed to
take the Mobile and Ohio out of the hands of
n receiver and turn il over to the stockholders.
To this end the stock of the Mobile and Ohio
bought at any price at which il could be
secured. William Nelson Cromwell was employed
to make the argument asking the court 10
! take the road from the receiver This argu-
ment was made six weeks ago at Mobile and it
resulted in decision a-ainst the new stOckhold-
| crs. Since that time Mobile and Ohio stock has
been going down in value.
On top OF the loss in capital here came
demand upon the firm yesterday for the payment
ties III the street use to raise this amount,
but no one wanted to advance any, and the rates
| for call money were so high that II was hazard
ous to take it. Four customers who had agreed
TO pay in money to cover their margins failed To
| keep their word, and there was nothing else 10
do but 10 make an assignment On Tuesday night
AN examination of the securities which were held
! showed that they exceeded by 20 per cent the
amount of outstanding loans.
There is littlr doubt that the firm will resume
business as soon as II can realize on us coiaterti
Many Of the securities which II holds are valu-
able hut il will I've some days at the earliest be-
fore the Necessary funds TO meet all the demands
can be cured upon them. The creditors are dis.
| posed To act most literally. and to give all OF
the time necessary for the firm TO get on It's zee.
again. The stocks sold under the rule TO meet meet
the demands of the call loan were: EvansNiile S,iil
and Tcrrc IIautc, 500 shares Mobile and ONO,
500 shares; Tennessee Coal and Iron, 200 shares
im"ntr ssrcs swefy PEORIA sna Dssatr and EvansV
several morts .ge bonds. 81 300 :. .os
The firm OF II. !. Nicholas 4 Co., is composed
of Harry I. Nicholas John 5 Nlcholas