The Bemidji daily pioneer., 1907-02-26
PRESIDENT OF UNION PACIFIC
EXPLAINS CERTAIN FINAN-
ciAL OPERATIONS.
DENIES SPECULATIVE TRANSACTIONS
ASSERTS ALL DEALS MADE BY
HIM WERE IN INTEREST OF
STOCKHOLDERS.

New York, Feb. 26.-The investiga-
tion Of the financial operations of the
Hartman group through the Union
Pacific railroad, undertaken by the
interstate commerce commission in
behalf of the United States govern
ment, was resumed at the federal
building at 10 a. m.
e. H. Hartman, president of the
Union Pacific, was the first witness
and, under examination by Frank B.
Kellogg, gave an explanation Of the
financial operations of his company.
The inquiry developed the fact that
after the decision of the supreme
court of the United States dissolving
the Northern Securities company the
interest of the Union Pacific company
in that corporation was returned to
them in shares of the Northern Pa
ciic and Great Northern company.
These subsequently were sold, as Mr..
Hartman explained, because the rev.
enues derived from them were linn
in stock of the Illinois Central Rail-
road company, the Atchison, Topeka
and Santa Fe company and the Balti-
more and Ohio company
"1n the first place." said Mr.. Harri-
man, I'VE had as the result of the
Northern Pacific purchase $82,OOO,O0O
of Northern Securities stock at a cost
of about $79,000,O00. Our annual re.
port and our statements all show that.
Then we were forced to take, by the
decision of the supreme court, un-
justly-it may have been legal-Great
Northern, which we did not want, and
a lesser amount of Northern Pacific
than we had deposited with the North
ern Securities and for which we re-
ceived the Northern Securities stock
At the time that stock, the Great
Northern and the Northern Pacific,
was given to us-forced upon us-it
had a market value of about $780,
100000. will go back just minute.
We had subscribed in the meantime to
$2,000,000 of Great Northern stock,
which had been
OlCISO 10 SHc SCOCknOlOSFS,
making the total cost of whatever
Great Northern and Northern Pacific
we had about $S2,OO0.00O. Instead Of
disposing of 1t at that time we held it
until the market price increased in
value to somewhere near 145,000,OO0
to $150,000,000 We sold some of it
gradually as it went up, but at that
value the returns from the Northern
Pacific and Great Northern were less
than 8 per cent on the stock that we
held. Therefore, we concluded that it
was better to sell these stocks and
curities that would give us greater re.
turns
Throughout his examination Mr..
Hartman insisted that none of these
transactions were speculative
II do not wish to give the impress
sion that we have been specializing
he remarked as Mr.. Kellogg pressed
him for replies concerning the pur-
pose of the acquisition of stock of the
Illinois Central, the Baltimore and
Ohio, the Chicago and Alton and other
roads. "They are for income and rep
resent reinvestment Of the proceeds
Of the Great Northern and Northern
Pacific" said the witness.
Are they for permanent invest
ment or do you expect to sell them
again?" asked Mr. kellogg.
Il have no expectation about It,"
said Mr.. Hartman 81 never thought
Of that; it never crossed my mind
It is for the purpose of receiving $6,-
100000 a year instead of $3,500,0OO,"
declared Mr. Hartman.
Hartman was in excellent humor
throughout and engaged with Kellogg
in several good humored sallies. He
said as he left the stand: 81 ought to
be good natured; it's my birthday"