The daily Gate City. [volume] (Keokuk, Iowa) 1855-1916, 1910-07-28

NEW YORK, July 2s.-One of the
boldest ventures in American flnan-
cial history and particularly in the his
tory Of American railroading came to
grief, when there was transferred to
Kuhn, Loeb & Co., Of New York. and
syndicate headed by them, the bulk
of large block of American railroad
securities, acquired in the last nine
months by British and Canadian
son.
The project was a reminder of Harri-
man in conception, however unlike
him in execution. The men behind it,
from the manner in which they car
ried on their operations, contemplated
nothing more nor less than obtaining
a dominant interest in chain of rail-
roads extending from the Atlantic to
the Pacific Coast.
DIR. Pearson, Canadian, who is said
to have been professor of engineer
ing at Tufts college, Is an engineer as
well known to British and Canadian
| financiers from the success of his OPP
eratious in Spanish-Amcrican rail-
roads as is that other Pearson, Sir
Weetman. from the profit derived from
tunnel building in Great Britain and
America
DIR. Pearson. who is not related to
the other engineer of that name or as
sociated with him In business, attract
ed the attention OF British and Cana
dian investors principally by the or
ganization and operation of tramway
companies In South Africa and Mexico,
Investors and bankers derived remark
ably handsome profits from these en-
iterprises, so that, on embarking in
/ business in America, he had powerful
! financial backing.
/ The first big venture OF DR.. Pear
son and his assistants in, this country
4 was made in the latter part of last
4 year. 1t was In the stock and bonds
of the Rock Island company, which
owns the Chicago, Rock Island and Pa
cific Railroad company, one of the best
of the granger lines.
/ DR.. Pearson made physical examin-
alton of the company's properties, and
on his report the Canadian and British
financiers who had long followed him
and profited through him, bought heav.
lily of Rock Island securities. Seem
/ ingly Judge w H. Moore and D. G.
Reid, the men then In absolute con-
troll of the Rock Island, were willing
/ to sell them.
In the early part of this year Dr.
| Pearson and one of his associates,
Percival Farquhar, said to be an Eng.
/ lishman, were elected directors of the
Rock Island company. 1t was given
resented by them had acquired about
4 20 per cent of the company's capital
4 stock. The company has outstanding
/ 100000 900 common and $50,000,00C
preferred. The syndicate bought more
/ heavily of the preferred than of the
common, and also bought heavily oi
/ Chicago, Rock Island and Pacific Rail
road collateral trust bonds. So here
was tidy investment to be in with.
1t was also announced at that time
i that Dr.. Pearson and his associates
were associated in harmony with
Judge Moore and Mr.. Reid, the other
4 dominant persons in the Rock Island
company These old Rock Island men
had long cast their eyes on Lehigt
Valley, and presently directed DR.
Pearson's attention to that property
DR.. Pearson made an examination Of
that property, also recommended i
to his Canadian and British friends
and got their money into it just as i
was put into Rock Island. Lehigt
Valley stock, which sold as low as g.
in the early part of last year, SCARED
up to 121A, as a result, in part, o
these purchases
} Here the paths of the old and nev
Rock Island men seem to have diverg
ed The others were content with tn
expansion they had already made. d.
Pearson and his assistants went fu1
ther, until, as it became known today
) ttey had bought into companies wit
: a stock capitalization Of fully S4S5
Z 100000, par value and controlling Il
377 miles of road extending from tn
) Atlantic to the Pacific.
These other operations were col
!. Quoted secretly. It was known ar
publicly announced that the syndici