The Montgomery advertiser., 1905-04-30
WRECK AND DISASTERS
MARK HISTORY OF CORNERS IN
 BOTH WHEAT AND CORN.
Many Victims of Deals--Prison Doors Have Closed Behind Some of Them, While Others arc Ruined Ff-
 nanclaIIy.

 ners in commodities. 1t is true. have gone through successfully, but all the | great ones have cost those who engin- eered them dear in the end.
 "Jim" Keene. who had taken some l $15, 100000 to New York from the Pa cific coast in the early 70's and added some millions thereto in Wall street was one of the first of the big operat- ors to learn something from the Chica- go market. In partnership with Jesse Hoyt, in 1879, he attempted to tie ur | the wheat market in America on the prospect of crop shortages in Europe. For year Keene and Hoyt had the market at their mercy. Prices jumped from s1 to s1.50. and when the latter price was reached Keene wanted to close out. But they held on. and in ner broke. There was a loss Of so.- ooo.o0o. which for time sent MT Keene out of the market.
 Operator Goes to Prison. In June of 1887 the memorable Cin- cinnati combination to corner wheat. led by Edward L. Harper. developed. Prices were advanced from so 5-S cents to 94 3-4, but the market collapsed, the price declining 10 65 cents. In the Harper deal margin calls were respond ed to slowly during the closing days. When the crash came margins were at maximum, and the break in prices swept seventeen large and influential firms out of existence and seriously crippled many more.
 | Then, as now, few suspected that the line of wheat owned was as large as It finally developed. Extended short sell ing through one line of commission houses offset the effect In the market of the scattered lines of long wheat held through many others. and there were frequent shifts in the holdings to cover the deal up.
 Claims have since been made that Harper was acting for wealthy prln- cipals, who finally abandoned him, sell ling short through other houses, from whom they collected their profits, and leaving Harper with a footed nationai bank and a penitentiary sentence. "OId Hutch" a Victim.
 R. P. Hutchinson, "Old Hutch" ono of the shrewdest members of the Chi cago Board of Trade, saw badly dam aged crop of wheat ahead in 1888, with little reserve. Before his plan was suspected he had cornered September wheat, forcing the price up to SZ. on the last day of September the nighest price was reached, and the following day 1t broke to s1.02. The next day. however, 1t rallied to $1.20, and "old Hutch" then could havo gotten out at a profit, but he tried to whip saw the market by selling December wheat short. When he tried to cover he found himself practically a financial wreck.
 S.. V. ("Deacon") White. of the New York Stock Exchange, Saw great op- portunity in corn in 1891. He pur- chased $7,000,o00 in options and cash deliveries, but just when 1t appeared the available supply had been cornered and prices were soaring 500,000 unsus- pected bushels of September appeared and broke the corner, with losses Of millions.
 The spectacular Letter corner in wheat in many respects the most cele- brated of all corners, ended in disaster, because Joseph Letter was unable to stop when he had won. Joseph Letter, then twenty-nine years old, backed by the millions of his father. the late Levi z. Letter, started to corner the market in April, 1897. Ho accumulated 14,000.. 900 bushels of cash wheat, stored in the elevators of the Northwest, and had options and futures that brought his holdings up to S5,000,000 bushels. For fifteen months he ruled the market, until his paper profits were estimated at $4,500,000.
 His father who had backed him by putting up $7,00O.000 in securities, told him to get out, but instead the son be- gan a systematic buying of options, which raised the price of wheat to $1,- S5. When Letter, Sr.. learned of the new purposes he withdrew his support, and the crash followed. Every dollar of indebtedness was paid by the fath- CT.
 John W. Gates, the latest to be bit- ten, has been a prominent figure in the speculative market for only six or seV- en years, but in that time he has been A yeritable bogey man to the Eastern stock market contingent Gates and the Chicago crowd" made their first big killing out of American Steel and Wire, after Gates had obtained fame as the originator of that combination. As promoter of the steel and wire com many Gates cleared something like $10,- o0O 900. but that was only a reserve for future operations.
 Out of the sudden rise of steel and wire, in 1899. Gates made few mil- lions. and at a time when the stock was the feature of the market he sprang q coup that netted him few more ana gained him the antipathy of hundreds of followers who had followed hlm as bull.
 Closes Several Mills.
 Gates suddenly discovered there was atapnatfon in the steel and wire indus try. although others could not discover fl and he closed down several mills belonginE to his corporation. throwing tbousands of men out of employment steel and wire preferred stock broke from e5 to 75, and common shores drop- ned from 65 to Al. Gates sold ms own stock short-50,00 shares of common and 10000 shares of preferred-and he cleared $1.620,000.
 From industrials Gates turned ms CT = forts to railroads, and the owners or trunk lines in New York went to pea o, nights in fear and trembling that on the morrow they might have to pay the C,htcago p1unger few million dollars for the privilege of retaining possess ion of their properties. The Louisville 6 Nashville deal was the most notaoie of Gates manipulations of railroa' stocks.
 Gates and his associates maae apouI ap S7 50O 900 in the coup by Whlcn they ,yrested that road from August NBel- wont and the Rothschilds. The Gates svndicate bought up 3o6,000 shares or the stock in the open market In the ear1v part of 1909, but so secretly was if done that their movement was not .usnacted until the climax came.
 On April the directors of the rall- road authorized an additional issue Of 5o O0o shares of stock, and they imme- dJateIv went into the market and sold so o00 shares short. They unwittingly played into the hands of the Gates nooI which bought in these shares,
 About this time Mir Gates, according +o tbe testimony of George w. Perkins,