The Barre daily times. (Barre, Vt.) 1897-1959, 1907-02-26
Financier a Witness Before
Commerce Commission
PROFIT in HIS DEALS
Got Overload of Great Northern-Forced
on His Road by Courts Northern
Securities Decision-Nice
Profit Made.

New York, Feb 26.-E. r. Hartman,
before the interstate commerce commits
sion in the Federal building here yester-
day, unfolded the story Of one of the
most gigantic stock speculations Of mod
crn times. Detail BY detail, he explained
how, starting with the ownership Of the
Union Pacific railroad, he had acquired
the control OF the Southern Pacific, the
Northern Pacific and half dozen other
of the great railways OF tire country.
Five members Of the commission were
present. Martin a. Knapp presided.
Commissioners Clements, Lane Prouty
and Harlan were the others present.
r. X, Kellogg and GA. Severance were
the attorneys for the commission. Har.
riman has his personal counsel, Paul ID.
Crayath, with him, as well as John h.
Ailburn and other railway attorneys.
As soon as the session was called TO
order Hartman walked briskly to the
witness chair. He looked high strung
and alert. Helped out By questions from
attorney Kellogg and BY reference to Il
mass Of railway reports, Hartman mn
folded the story o. his mastery Of Amer
lean railways.
II began with the issue by the Union
Pacific railway. in convertible bonds,
which were Inter turned into stock for
the same amount, ON top OF this $780,
100000 the Oregon Short Line, also con
trolled BY Hartman. raised $4,000 600.
Through Kuhn, Loeb and company,
100000 shares Of South Pacific stock
certificates were purchased for Sal 900 \
900 and SCI 900 was used TO purchase
certificates in the Northern Pacific: $751;
100000 more was used to pay for i'm
provements in the Southern Pacific and
stock subsequently taken for this
amount.
This was the first step and gave Har-
riman control Of three transcontinental
I lines.
Mr.. Hartman then told the commits
sion that when the supreme court dis
solved the Great Northern merger he
found that his Great Northern and
Northern Pacific stock together was
worth about 500, 900, 900. The market
value of this subsequently increased.
I The income from the Great Northern and
| Northern Pacific stock together, however.
was small, oniy about S3.000,0GO a year.
| He therefore sold this stock, realizing
l$il6,00o,000. He said he had reinvested
iSs5000,0 600 Of this and still had x.0,-
4 100000. BY selling the old stoel. and
buying new stock the stock iurome OF
the Union Pacific and the Oregon Short
Line together had increased from So
100000 to $4,000
1t was then developed by the testi.
mony that it was this money which had
helped Hartman to further eonquests
lie bought into the Illinois Central, the
Baltimore & Ohio, the Chicago & Alton
the Milwaukee & st. Paul and other rail
roads.
Counsel Kellogg for the commission
electrified his hearers by declaring thar
he expected to prove that the stock OF
tho Chicago & Alton had been initiates
beyond all reason, that he expected to
prove the stock was really not worth
dollar and that S130,000,000 or $780,
100000 had been paid for in this most
remarkable ef all railway stock tran.
lsactiOns. Whether the stocks had been
real purchases with the Union Pacific
surplus or with money raised in other
ways was very pertinent matter for
inquiry by the commission and Mr.. KEEL
logg thought in conclusion that the com
mission had a perfect right to inquire
into the transaction, even to the small.
| est detail