The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1910-04-19
Department of Justice
Starts Unprecedented
Investigation.
PATTEN KNOWN
AS REAL LEADER
New York Exchange Aghast a,
News of Attorney Generals
Action, and Excited Break
in Prices Follows-Grand
Jury Will Hear Evi-
dence To-Day.

New York, April 18.-rhcre will be
started in New York Tomorrow
Federal investigation without prece-
dent In this country. The Attorney
General OF the United states has or
dered an inquiry into the gigantic
bull movement in cotton with which
the names OF james a. Patten, Of
Chicago; Frank r.. Hayne. William 2
Brown. Of New Orleans. and Eugene
Scales, OF Texas. have been popularity
connected.
Hayne and Brown both appear as
defendants In the proceedings, but II
could not be learned whether Mr. Pat
ten would be subpoenaed at Chicago TO
come here to testify. He has been
credited generally. however. with be-
ing the financial genius of the pool.
and in recent interviews he has out
lined his bullish position and his de-
termination to fight the supposed bear
clique which has been reshipping cot
ton TO this country from England in
an endeavor to break the market The
bull movement has reached such a
stage, however, that there are rumors
of a possible May corner in the New
York market.
First Action of It's Kind.
Never before has the government
brought similar action against any
pool operating in the market on either
the long or the short side. Subpoenas
We're issued at the direction of Mr..
Wackersham, commanding a dozen or
more prominent New York cotton
brokers to appear before n special
Federal grand jury tomorrow to testi-
fy In the matter of the United States
against Frank b. Hayne and William
p. Brown
The subpoenas demand the submis-
sion TO the special grand jury of all
records, papers, letters, memoranda.
and an agreement daSed February &c
last by Haync and Brown and Others
The agreement, the subpoenas state
was the purchase of 10000 bales OF
cotton for delivery in New York dur
ing the months of May and July. in
elusive. al certain prices and certain
conditions. The fixing of the prices
and conditions. the government,
| charges. was violation of Law.
announcement of the rovernn.n,,s
autioh was followed BY very ey
e!teo break In prices on the New Yor,.
lion ESchange. which at ono ,i,no
otu lar 10 result in almost as ersat
q generalization as that notod Ia.
,' SanuaFS. Early in April. the mar,xa.
nae, ,.ad very severe break under haa,.,.
ttlioation, and al that time. there
mese rufnors circulating that the bulI.
aoandoning their position. bpt a
~ ue.ao oie recovery in prices since
mon suggested that tho selIine hsd
neen largely in the way of outside
liquidation, and during the past wool.
or ten days there have been renewed
u..iors OF an impending squeeze.
me position in the near months. al
any rate, mas led to heavy shipments
OF cotton to New York for delivery
on contract. and the arrivals reported
.o-uaE were in excess of % 900 bales.
including nearly 1900 bales from Liv-
erpool, while the stock of cotton avail
Die Tor delivery on contract has al
| ready increased from about s7OOo
bales to 10000 bales Even so. It
| has been apprehended in local circles
that the amounts OF cotton arriving
nero from the South and abroad We're
not sufficient to completely satisfy the
contracts held by the bull leaders,
| which have been estimated at about
| 100000 bales. and there has probably
been some scattered buying based
upon an expected successful issue OF
the bull campaign.
\ SeIIlnS FOLLOWS 'lnFeRt.
The selling which followed to-day's
threat of possible legal obstacles to
bullish plans probably represented, in
a measure, the liquidation of this So
called trailing interest In addition
There was undoubtedly some selling
| for the account of professional traders
! on the idea that legal action might
force the liquidation of the bull hold.
/ ings.
But usually close students of trading
| around the local ring eNpresseu ttte
/ opinion after the close that tne pu'
| leaders themselves had Increased ram
! er than reduced their contract holu
ings, and the market ruled consider
ably steadier in the late trading ane
closed at loss of only from ten tt
i nineteen points for the day
/ When the news of the government!
i decision at first was circulated tn
market became very weak and unset
i tied, and inside Of an hour May cotton
sold at 1854, or thirty points below
] the high level of the day and abou
| forty five points under the high price,
of last week MAY closed at l4.6o bid
4 Later months sympathized IN the nea
month break, but interest was prett!
much confined to the OLD crop, am
aside from the excitement with refer
/ ence to May and July contracts ther
] was no particular feature
! Wall Street was stirred by the news
/ and 1t was widely discussed also il
1 banking circles, and much interest VII
be taken in the hearing by the tinan
1 cial district and the Stock Exchange
as we'll as by the. entire cotton trade.
probe Will he thorough.
Washington, d. c., April 1S.-.Attor
4 nay- General Wickersham has taken U
the scudgel against the reported poo
4 in raw cotton. which. it is alleged, al
\ ready has resulted In an Increases
price Of that staple and a curtailmen