Evening star., 1911-05-27
Cause of Stock Transfer.

Cause of Stock Transfer.
We'll Mr.. Chairman" replied Mr..
Gates, with a twinkle in his eye. there
are good many underground wires I'm
Wall street. / was told that a certain
bank applied TO the clearing house as
ISOLATION for assistance, and that the
committee which looked over its affairs
found a large block OF I. G. and / stock
held as collateral"
AS a result, to shorten the story, the
meeting In Norgan's house was held.
which resulted in the bank being re-
lieved from the tension placed upon it,
and the transfer of the securities oc-
CURED.
.Had it previously been the purpose
OF the steel company to get hold OF
your company asked Mr.. Stanley.
1t was here that Mr. Gates showed his
loyalty to his financial colleagues. 'Oh.
/ can't say what was in the mind OF
the steel people" He did say, however.
that at one time year previous he had
been offered by Mr.. Morgan. through an
other person. $50 a share for his T.
e. and 1.
II didn't want to SELL" he said. 'I was
like the man who had horse that suited
him, and wanted to keep him."
What effect did this transfer have on
the financial situation?" asked Chairman
Stanley.
TT did not add to nor subtract one dol
with emphasis.
Asked about Mr. Morgan's condition.
Mr.. Gates replied humorous1y, We'll, 1
didn't hear any talk of Mr.. Morgan MAX
ing an assignment"
Forced Sale, Gates Says.
WAS tho T. c. & I. forced sale?"
asked Mr.. Stanley.
II so regarded It," replied Mr.. Gates,
"and It was a bargain to the buyers
did you lose money on your original
investment in your stock? asked Mr..
Young OF the committee.
Yes: on the then value Of the sinking
fund bonds we lost $40 or $15 share.
We thought that our stock was held by
a group Of men who could weather any
panic"
what did force you out. then7'
1.-The discovery OF the big blocks Of
stock held as security by the trust COM
pany mentioned. The trust company is
perfectly solvent. and its stock is held
high
Mr. Gates was questioned in the effort
to ascertain how much Mr.. Morgan per-
sonally had to do with relieving the
banks situation. but declared that his
knowledge on that score was entirely
hearsay.
Loss of Million-Dollar Option.
Mr.. Gates then told how w. H. Moore
and H. c. Frtck lost 81 100000 to Andrew
Carnegie in 1897 through forfeiture of the
option on the Carnegie steel works. and
the early history of the organization Of
the United States Steel Corporation.
When asked by Representative Stanley
how long negotiations were pending be-
forethe organization Of the steel corpora
ton In 1901. Mr.. Gates answered at
length.
'-The price OF finished Steel" he said,
became badly demoralized in 1898 or
1897. Mr.. Fr1ck and Judge w. II. Moore
conceived the idea Of securing an option
from Mr.. Carnegie for his steel plant
They got the option and paid for 1t
81 100000 Soon after that demorallza-
tion Of the business became SO great
that they couldn't put IT through. The
price. I think was 160,000,0O0. They
had to forfeit that option, and they
were not particularly pleased over that
result
Soon after that the Federal Steel
Company was formed. with the con-
solidation of the Lorraine Steel Com
pany, the Minnesota Iron Compan, the
Illinois Steel Company and the Elgin
Joliet and Eastern railroad Prices be-
came more stable in 1898 and 1899. and
in 1901, when the United States steel
Corporation was formed. they were
very good.