The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1898-07-29
HE PLEDGES
REALTY.
Old Man Letter Helps to Cover
the Heavy Losses
Of His Son = He Puts Up His
NEARLY 80 MILLIONS
Are Now Involved in the Deal
Which May
Yet Win Out For the Father
and Son.

busy and eventfu1 days for L. z. Letter
and his son, Joseph. Slowly, but sure
ly, they are cleaning up the wreck of
the great wheat deal, and trying to put
their financial affairs in satisfactory
shape. The salvage for which they are
working is the enormous sum Of 49,
OOO 600 in gilt edged securities and some
| u, 900, 900 bushels of cash wheat
In all the history of speculation no
similar case can be found in which
father and son have united in playing
for such an immense stake. Within
the last ten days Levi z. Letter has
raised over $4,000, 900 by the sale and
mortgage of high class real estate. All
/ this money has been used in paying off
his wheat deal Indebtedness and 51In1-
lar big transactions are to follow
Mr.. Letter is not raising money sole
ly by disposing of real estate. He is
saving it by a strict personal economy
! which includes the cutting off of sever
al public charities for which ne was the
principal sponsor. One Of these was
the Chicago Waits mission an indus
trial home for street boys, for the sup
port of which he has contributed $1,000
a month for the last four years.
His Charities Cut Off.
The mission has been closed and the
work abandoned. There are public
| records to sUbstantiate all OF the above.
1t is not idle gossip. The books of the
county recorder snow the realty lTdIlS-
actions. A formal and official transfer
has been made of the inmates of the
waits mission to the Illinois AgrlcuI-
turaI and Manual Training School for
Boys a GIenwood, Ill.
When the Letter deal collapsed, on
June 18th, it was estimated that the
| promoters would have to stand net
loss of from $4,000,000 to $4,000, 900. No
1 responsible board of trade man placed
| it at mere than the latter figure, and
! even this was considered wildly excess
sive. The deal up to the beginning of
June had been phenOminally success
full; wheat was selling at a big advance,
and the paper profits of the Letters rep
resented something like 81, SOC, 900. How
all this could be wiped out, and a loss
of S. O00, 600 more be sustained by a
break which still left prices higher
than they were when the deal was
begun, puzzled the Oldest and shrewd-
est of operators.
But, at any rate" they said, "$5, 000,-
600 is a mere bagatelIe to the Letters.
They'll square up and get out of the
market, and that will be the end of it,
Instead of doing this, however, the
Letters hung on, despite a weak and
dropping trade, and this OccaSiOned still
more surprise among the operators who
| thought they knew the whole inside
history of the deal. Why the Letters
did so is just becoming plain. The loss
of 5000, 900 didn't worry them much,
but there was a bigger fortune than
this by nearly fourfOld tied up in the
transaction and in danger of being
swept away.
It was to save $40. 900, 900 that the Lei
tiers were battling and it looks now as
if they would win out, thanks to their
bulldog pluck and the fathers big real
estate holdings. How they came to be
thus involved and the measures taken
to extricate themselves make a chapter
in speculative operations the like of
which was never before written.
L. z. Letter was not known openly in
the wheat deal, but he was the f1nan-
ciaI hacker of his son, Joseph, from
the start. The 1atter's operations be-
gun quietly in April, 1897, when wheat
was selling at 7O1a cents, and by Au-
gust of that year had reached a point
which necessitated the use of a large
sum Of money. Even millionaires run
short of cash at times, and l.. z. Letter
began to be a borrower at the banks.
Bankers Began To Worry.
At first his notes were taken without
question, but as the deal went on and
some 81, 900, 900 obtained in this way
were tied up, bankers grew more care
full and insisted upon having good col
lateral attached to the new notes.
Handling wheat by millions of bushels,
| responding to margin calls, paying car
ryfng charges and meeting cost Of ex-
port is no child's game, and as the deal
| progressed gilt edged securities began
to come out of the Letter strong box
and find their way into the banks as
| collateral for wheat carrying loans.
Early in last June L. z. Letter did
some rapid figuring, and found he had
| tied up in this way about SIG, 900, 900 of
| his best security on which he and his
| son had received loans of $40, 600, 600 The
market conditions were not inviting
| and it was plain that the deal was be-
| ing carried too far; that a bad mistake
| had been made in trying to protect dol
| lar wheat by boosting prices to 81 so
| and $1.S5 and taking all offered at
| these figures.
Mr.. Letter and his son had a confer
! ence at the Auditorium hotel and the
| former said plainly that he would go
J be abandoned at once so far as he was
| concerned. When this decision reached
/ the ears of the bankers they, of course,
/ took steps to protect themselves. The
| $4,000 600 which had been loaned to
/ Letter was furnished mainly by Chica-
/ city that were the most heavily inter
! ested being the Illinois Trust and Saw
! iugs First National, Continental Ma
! tiona1 and Merchants Loan and Trust.
100000 Bushels Tied Up.
Besides the 100000 Of securities ware
house certificates representing Il 900, coo
! bushels of cash wheat, purchased at an
| at various points had been deposited as
! collateral on loans made at the rate of 50
| cents a bushel
| when it is known that the Letters were at
| one time carrying as much as So 900. 900
/ bushels, on a large share of which the
| As the market slid off after the collapse
| the bankers notified the Letters that some
| smash.
/ The security was ample so long as there
| was no wild break and this was prevent
! ca Dy IFuSteeing the immense stocks of
| wheat and turning them over to p. D.
Armour to dispose of on commission.
! If these 1900 00e bushels of wheat could
1 al ffvua