New-York tribune., 1902-07-19
A TALK WITH j. W. GATES.
SITUATION-HOW STEEL TRUST
WAS STARTED

In a long and interesting interview in The
Commercial Advertiser" yesterday. John W.
Gates reviewed his business career. gave his
views on the railway situation. and set forth
facts not previously published regarding recent
notable market movements and concerning the
United States Steel Corporation. Asked about
the contest for control of the Louisville and
Nashville, Mr.. Gates said
On Louisville and Nashville we had the opinions
of the best experts and auditors country that
before we started into it, We knew it had 5o00
OF qllck cash assets in its treasury me Pupbhe h
stock, We started in knowing the actual intrinsc
value of the company and its exact physical condi-
cial condition. When obtained 8O6,6oO shares OF
short interest in the market Of $50 900 shares OF
was stock Mr.. Belmont had sold under resolution
Of the board authorizing its sale; These o0D9
if We, had called the stock and insisted upon the
speclhc performance Of contracts, as we hao every
rsht 70 do, we could have caused panic greater
responsible man financially that if would call and and
Insist m upon delivery Of Louisville he would % ot! sH
for doing it. MI Morgans people sent TO my h0tei d
that meeting az Of B bankps M Ts It had been
mined that we were owners Of Louisville and Nash
to do about it., stating that it meant panic prob
the proposition that had been made to me- but that
under no circumstances would we insist upon spe,
Nashville stock as we we had no wish Whatever 70
STOCKS ey bed or we e oahed M 0 Bmons People
an the stock they wanted without any premium
The people interested with in the purchase of
Louisville To- I % and Nashville we're able to have paid
s the neWsPaperS often allude TO me as doing this
? per cent Interest There are lot Of fellows who
are always willing TO go along with me- however,
them fairly. Many men have been with me for ten
do not say that they have not made losses but the
net result has been that they have made millions
in New-Yort If there was loss "'s Vent to the
end with them. and If there was profit 1 went TO
Mr.. Gates's account Of the genesis of the
United States Steel Corporation is as follows:
January Of 1901 he Informed me- ell that In J. Morgan
situation; The Carnegie Steel Company was
tbnreatening to build large steel tube plant and
Pa9y' IN which Mr.. Morgan was largely Interested
After several hours talk S With Mr. H nfsoE tod him
Ta IN my my , opinion there was but one way to
SIates I and that Vas by an actual consolidation,
qgbt 'haI all bs r ro Morga9 you'd 20 to york az It
United States @ could Re brought into one company:
me me 70 core down to the bank and explain what
MI nae M5aran 5aa9 TO Mr. , M ala so and outlined to
was was atterward named the United States Steel
l told him about the lines and general terms
si snt YOU'D YOU'D have to be adopted TO obtain the
and most aggressive steel works in the World was
steel manuf tcturers I assured him that there
was but one way 10 accomplish the consolidation
was very well sc9uanad M senTa9 ShS 4S WITH 5b%5 whom
m iau taIked about the matter many times to agree
: 20 a pan In advance and submit that plan 10
heS sir SSaFnsgle and get his approval. and then
dLSdu ana consummate the consolidation.
All Mr, Morgan requested me TO see Mr.. Schwab and
having first posted Mr schwab Teesrd,hF S mv SnT Gr.
% %mer talk with Mr.. Morgan the subject We
Hnay ma mapped qu! plan after several hours talk
TO- and that strongly recommended, After many
form the United States Steel CORPORA tion--naueIy
the National Steel Company. the American Steel
pany the Federal Steel compsSy aq the "Ee GsreSe Ge
the bee tss sIs AmGrieon Tin Plate Sompan
can Bridge Company, together with the II. c.
negie concern-thc basis was made and all these
I familiar with all the plants Of the United
states steel Corporation. with al their ore prop
lines. both railroad and lake steamship. and the
YGas ns5 Of ssa ssSh sfl snd have never sold are o
change todaT The bSne @ Of M OK 45iS ss9cS H
Steel Corporation is world wide
regard the formation OF the United States steel
man lhat has as Ter S Be fto5 5b6 0T The IN 2o2T1s
as they employ practically two hundred thousand
men who are paid at least from 90 70 % per ceE;
higher Wsges % heT I foreign aomPft'9;s for The
a FIRST class quality OF steel at reasonable price
the price OF steel rails to-day oeng only SOS a ton
@ %H {e ras PFGe 2 asn H S s
United States, OF from S75 to Sl2 ton delivered.
sl25 less than score Of years agol
Mr. Gates said Of the corner in July corn in
Chicago;
had nothing to do with the corn deal had
no part whatsoever In II. Harris. Gates & co.
they undoubtedly bought and sold large amounts
OF HarP cane: o thoGF5 ihg am
partner therein. l have never the inside or a
oooH OF he & ny y so 0L n En- nave
IN the corn deal. but IT would be unfair for