The free lance. (Fredericksburg, Va.) 1885-1926, 1911-08-01
THE STEEL PROBE
House Committee lnveSti-
eating Big Deal.
HOW PANIC WAS STOPPED
Former Manager of Tennessee Com
pany Says 1t Was Sold to Save
New York York Bankers
From Failure.

New York, July 29.-In getting from
Leonard C.. Hanna, a brother Of Mark
Hanna, and one of the syndicate man
ayers Of the Tennessee Coal and Iron
company, a narrative OF the way that
company's stock passed to the United
States Steel corporation, the congress
sional committee which is looking into
steel matters here, spent a great deal
of time on possible Washington inhu-
ence at the time of the transfer.
Mr.. Hanna told how he came to New
York from his home in Cleveland in
response to a long distance telephone
call on the Sunday before the deal
was arranged. He cooled his heels
as lie expressed It, In Mr.. Morgans IL
brary until Judge L. IL. Gary arrived
from Washington.
Before this Mr.. Hanna had been IN
consultation with Grant B. Schley, OF
the banking firm Of Moore & Schley,
and who was the other syndicate man
ager. and had been convinced OF the
wisdom Of the deal Saving the firm OF
Moore & Schley, which was in DIM
cultles when banks holding 7. c. AMI
|. stock as collateral. asked for SUD
stitnte securities. appeared to be Ike
holding up the tenpin which In It's fail
might carry down many more.
There was another matter that BOTH
cred the comitteemen. and for which
Mr.. Hanna couldn't give an explana'
ton that satisfied them. He had said
more than once that the sale OF the
r. c. and /. stock appeared to be the
turning point that took the edge on
the panic Of 1907.
Done you know" asked Congress
man Bartlett that President Roose'
Welt congratulated the secretary Of the
treasury, Mr.. Cortelyou, and the sub
s4antlal bankers OF New York on the
say in which they had come to the
help Of the nation, and that this hap
pcned two weeks before the agree.
ment to which you refer was reach
ed?"
My recollection is that the aid that
came from the government was mad
eqaate," said Hanna.
And yet what the government had
not been able to accomplish when IL
scattered s6O,0OO.OO0 in the banks Of
this country. particularly New York. v
said the congressman, and what the
Morgan interests couldn't do when
they put their millions in, too, was ac'
compllshed by a sale OF stock that
only involved few millions. You have
said here that this occurred without
dollar exchanging hands; that 1t was
all done through the passing OF Sc
curities. and yet that it stopped the
panic"
1t did a great deal toward restoring
confidence" said Mr.. Hanna.
Mr.. Stanley asked whether any firms
had been employed to finance the syn
dicate.
While | was connected with II,
said Hanna, "our financing didn't cost
us the price Of a postage stamp
Ihen MI. Hanna eNpldlneu dDout Dc
ing called on the phone and told about
the fact that New York banks wanted
other securities.
"Was this because the banks doubt
ed the value Of the stock or were
these banks forced?" asked Stanley.
81 think It was the nature of the
stock" was the answer. In a Wall
street phrase, ii was pegged stock, be-
cause Of the syndicate. and you know
such stock Is not wanted by banks.
They are shy Of it"
lie said that after the United States
Steel per cent sinking fund bonds
had been substituted for the T. c.
and /. stock the pressure Of the panic
ceased