The Saint Paul globe., 1900-05-13

he masters now. But In his familiarity
with the iron and steel trade, and the
rapidly increasing demand for its prod
ucts he found his opportunity.
At that time barbed wire was a new
product on the market. There was an
enormous demand for 1t for fencing,
especially throughout the Western States.
The manufacture Of the wire was con-
fined practically to one firm, the Wash
burn & Moen company, now members Of
the steel wire trust, which Mr.. Gates or
ganized. This firm controlled the busi-
ness through very broad patents which it
held. Prices were high, and the industry
yielded big profits.
Mr.. Gates came to the conclusion that
these patents would not hold If put to
the test of law. Accordingly he quietly
embarked in the manufacture of barbed
wire on his own account, opening small
mill in st. Louis. Immediately he began
to make money more rapidly than he ever
had done before. For a time he was un-
molested, but as his business increased
the larger company heard of his opera
tions and at once started in to drive him
out of business.
Then began a struggle between the
WashbuRn &, Moen company and Gates.
In the matter of capital, influence and
command of the trade, there was no COM
parison between the two, but Gates was
fighting for his business existence, and
he refused to be beaten. On one occasion
it seemed that the battle had gone against
him. His opponents secured an injunction
from a Missouri judge commanding him
to cease the manufacture of wire But
Gates was equal to the emergency. He
packed all his machinery and supplies
upon wagons one night and moved across
the river into the state of Illinois, where
he continued his business until the case
was decided. -
In 1886 the contest ended in victory
for Gates. The United States circuit
court handed down decision declaring
the Washburn & Moen patents invalid
The young manufacturer knew that this
would be the signal for the opening of
number of new mills, and he determined
to secure as large a share of the trade
as possible. He enlarged his establish
ment in st. Louis and secured an interest
IN another one In Pittsburg. AS fast as
his capital permitted he started other
mills.
In 1889 he Systematically began the alb
sorption of all the barbed wire plants in.
the country, and within the next three
years he gathered twenty-five mills
practically all the important ones in the
country except that of his old rival, the
ashburn & Moen company-into the Or
ganization that was known Familiarity as
the Barbed Wire Trust y
III 1913 John w. Gates, who had started
IN IN the steel wire business only ten wears
i' Det3iae' was president of two great com
PdnieS-lhe Consolidated Steel and Wira
company and the Illinois Steel comDanv
Inc latter was the largest concern enter
4ng INTO the, formation of the gigantic
t;etl teueIal Steel company, in the organiza-
6Ion In OF winch Mr. Gates was very active
me o Federal Steel company was formed
IN 1873, and in that year the wire inter
estS Were brought into a single organi-
1n 1Latlon py the absorption Of the Wash
oqrn & Moen company
IN dozen years Mr.. Gates had made
scbs q great fortune and had carried out
ScnemeS of vast proportions recurring
boldness as well as enterprise and sound
Judgment: At fifty years of age he was
Seneral sen times millionaire. and his in
nnt Iedests e1,;e were IN such form that they did
no. require his personal attention.
ne decided to retire from business, and
ceeslghed the presidency of the Illinois
Soe nteel company, y intending to go to Eu-
were Iald with this object in view when
SS ne was one day taking luncheon with
MI. MT. EIWood the suggestion was made
lnat the reorganization of the steel and
wire interests would be a good thing
,We'll do it!' exclaimed Mr. Gates.
Inc TWO men hurried from Chicago to
d,ie.ad diItsDurg, and within a few days had Sc
tpIeu control or enough plants to assure
e. SIie success OF the plan The American
steer and Wire company, with its capital
Et5 tNaeioil o1 @9y'VV0OOO, Was the result. 1t is
trust was organized breaks the record in
s lnIs particular Mr.. Gates trip to Eu-
b rope was abandoned, but it was said that
MS stroke Of organization.
Since oiIice the reorganization of this great
corporation Mr.. Gates name has been
Pr Proliilmeht many times in connection with
qI 1Ile or another great stock operation.
re was concerned in extensive trading in
federal Steel and Chicago Gas, and only
"a IeM weeks ago it was currently report
eu that ne had cleared nearly 81, ,0O0. 600
rom tne rise in Baltimore & Ohio and
Cilon Pac1hc stock. More recently still
@ tne story was published that he had been
one of the players in "a poker game in
Wnlch fortunes were staked in single
pots.
None of these affairs, however, created
th the sensation that has been caused by
lne latest coup of the Chicago financier
VINO mas acquired the reputation of Jug
slins with millions as magician might
Win lnoividual coins. 1t is said that this
o-I oCHelne: ne IKE the formation of the Steel
anu IIIr wire company, originated during a
Iuncheon discussion At any rate the
business world was startled by the an
i',Iin II1,IuiitceIllent that twelve of the trust 9
rIl IrlllIs were 10 shut down, throwing 1000
men out OF employment. "Overproduc-
ti4Il was the reason advanced.
II mas Deen fact of common knowl-
Suse Tor some time that in nearly every
branch of the iron and steel trade mills
1,-1-
nave been overcrowded with orders and
nave nave peen running night and day. There
iole ~ IlIe statement given out by Mr.. Gates
IN explanation of the action, for which
ne ne ADMITS responsibility, came as a de-
GIqed shock to investors and speculat ators
.y Ihey Were startled and surprised. One
,niI1g rn1ng only only was clear. The closing of
InliS meant a depreciation in the stock
of the concern. They made haste to un-
load and the quotations on the company s
pre- pIeIerred stock. which a few months ago
had been quoted around par, dropped to
70, while the common, which had a rec
ord of Y, went below f40.
Some OF the sufferers by the slump
were unkind enough 30 say that Mr..
1 Gates had- "bearedib his own stock and
reaped big profit thereby. A storm of
protest was launched at him both from
without wit ~; and within the ranks of Steel
vet but Mr. GatesGstea0iiy AYERS that
time will prove thebpractical wisdom of
In his tastes Mr.+Gafes is distinctively
American. Besides his fondness for what
mas been called the national game" he is
fond hnFSnc L fo.-. Il