The Marlboro democrat. [volume] (Bennettsville, S.C.) 1882-1908, 1903-11-13

SSer9and IN lxOnsWefe NCOnCernedtt 6
kIt#dtd nots close the S Shig ii IS finance.
;sh.fIofg gan and Sch sab had to get theiS
Eprpfi tS; 4,
Dresser testiiie that mi hen the:
Inego ottatiCns were on, Mr. Schwab told
him 1t would be ne ecessarY to- market
the $40, 900, 900 block of! stock { owned.
by SchWab and M Morgan before anySo OF,
! the 3 10, 600, 600 remain ling: :StOc k & w;:::s
to be sold D This was to- rein burseI
Schwab and Morgan for their abors.
Twas agreed that the stock should
be! put on the market ut $65. a share,
for the. preferred and .S25 d share for;
the common. II, us 4 Morgan and
Schwab expected, their stock had been
sold at these figures, Morgan would
have received $2,26O, ,0O0, for; his S5,-
600, 900 worth and Sch va b would have;
received SO 75O, 900 for his Sl6, 900, 900
worth. This was to be tile cash bonus
for selling the Bethlehem company to
the shipbuilding company. Then, If
the public appetite was unsatisfied the
holders OF the SIC, 900, 600 remaining
out OF the $50, 900, 900 worth Of stock
might sell theirs.
To clinch this arrangement, an
agreement was signed between the,
stock brokers, Harris 81 Gates, Charles
M. Schwab and Dresser and Nixon
which stipulated expressly that the
$4,000, 900 worth OF stock owned by
Morgan and the $4,000. 600 worth
owned by Schwab was to be sold first
at the price agreed upon-S65 a share
for the preferred and S25 share for
common. Not a share Of the other
stock was to be marketed until
Morgan and Schwab had cleaned
out their holdings to the public.
This was rather rough on the
other insiders, but Dresser and Nixon
signed. The agreement was ready
before they got there. 1t is dated
August il, 1902, which is the day
when the deal was closed and the
stock transferred to Morgan aud
Schwab. Those gentlemen bad their
plans laid and they we're ready to do
business at once. They took no
chances, but demanded that the S1O,-
100000 worth Of stock remaining
should be held in trust until the Nor
gan and Schwab stock was sold The
scheme was beautiful in it's simplicity.
Morgan and Schwab wanted their
money, wanted it first and they left
no loopholes, 1t was an arrangement
within an agreement. There were
two kinds Of insiders, real and theore-
tical. Morgan and Schwab we're the
real ones. The theoretical ones were
obliged to wait until the public had
been MIXED Of the millions demanded
by Morgan and Schwab. Then the
public was to be MIXED again with
the remaining re $4,000, 900 of stock.
Anything left after that the public
could have.
In the witness chair, Mr.. Dresser
did not explain why Morgan 81 Co.,
demanded the enormous bonus Of $5,-
000,00 worth OF stock. Dresser said
| the check which he paid The Morgan
company was given him by Mr..
Schwab. Mr.. Blythe says that the
men who are familiar with Wall street
affairs say that Mr.. Schwab got the
check from Morgan and that, if it is
true, explains much. It also shows
that MIR. Morgan, If the conclusion
Is correct, demanded 2,5OO.OOO for
the time loan Of 81, 246,S71 that
he gave the check and took it back at
once, for Dresser and Nixon indorsed
it to him Immediately after they had
received it, and that Mr.. Morgan's
firm simply bought its own property
with It's own money-put the check
from one pocket to the other-and ex-
pected to get S2,25O, 900 for the ac-
commodation. Mr.. Schwab has never
told where he got the 81, 7,246,87
Mr. Blythe concludes-h interest
, ing comment upon yne Dresser tcsti.
mony in this way. This is the story
OF high finance ald the shipbuilding
trust. Two years or three years ago
1t would have ended happily just here,
for the public would have bought the
stock and Schwab and Morgan would
have made their money. 1t does not
end happily for Morgan and Schwab.
The public refused to pay. The,
would not touch the shipbuildinu
trust stock. Harris & Gates could
not sell it. 1t was Of no value. The
specifications provided that the in.
vesting public should clamor for the
stock. They had clamored for stock
Just as worthless in days gone by
Greatly to the aStonishmen6 Of all
concerned, there was no clamor.
Various expedients we're tried to start
q boom. The boom wouldn't start
Finally, Mr.. Schwab gave J. 2. Nor
gan &c Co., $4,000 for their s5, ,OOO,.
600 worth Of stock, for which the pub
lie was expected and asked to pay
thirty times as much. Mr.. Schwat
may have that stock now, together
with his own S15, 1000 900 worth. The
shipbuilding trust is in a legal tangle
Nothing but high finance has suffered
except the shipbuilding trust stock
which cannot be given away. uigl
hnance has suffered and suffered gre at
ly. The public comprehension has
been illuminated by Dresser's story
of how pool was formed within d
pool, how it Is possible to be buyer anG
seller at the same time, how there arc
agreements back Of agreements, how
there are cellars and Sub. cellars under
the ground floor, and how deliberate
campaigns are made to fleece the un-
wary. There are many denials and
talk OF prosecuting Mr. Dresser
Meantime Dresser's reply has sunk
deep into the public mind and the con
clusion is raridly forming that there
are but two sides to the promotion OF
high finance. The high financiers
take nc chances and the public has NJ
chance"
A STRIKING CONTRAST.