Las Vegas optic. (East Las Vegas, N.M.) 1908-1921, 1911-05-27
ANSWERS QUESTIONS FULLY
ExpL AIMS AT LENGTH METHODS
eY WHICH TENNESSEE CON-
PANY WAS ABSORBED
1T WAS A FORGED SALE
TRUST COMPANY OF AMERICA
NEEDED $to,ooo,ooo DURING
PANIC AND GOT 1T

Washington, May 27-56hn W.
Gates. who appeared as witness
before the special house committee
investigating the steel trust, today
declared that the accumulation by the
Trust Company of America, OF New
York in 1907, of a great block OF the
collateral of the Tennessee Coal and
Iron company, made possible the ac'
u,d.;+;on of that company by Ae
4rnited states Steel corporation. MT
Gates said he regarded the transac-
ton as a forced SALE
The special committee, OF wnlcn
representative Stanley OF hentucAS'
10 chairman, had determined that an
investigation of the Tennessee Coai
and Iron company deal, which is SAID
n have been approved by Presldent
roosevelt should be the first subject
taken up. Mr. Gates was the hrst VIII
ness to appear before the commlttee'
"Did any member of firm or bank
,,,ol,a a proposition to the Unlteu
states steel corporation to accept tne
Tennessee Coal and Iron company as
a comparatively worthless properly
asled Mr.. Stanley. I'm other woros'
who flew the signal of distressF
"There are a great many under
ground wires in New York." MT
Gates replied. 81 was told that a GER
tain bank in November, 1907, appileo
to the clearing house for assistance
A committe was appointed to exam
inc it's assets. They discovered sew
eral millions of the banks funds OUT
on stock; of the Tennessee Coal and
Iron company. They reported to the
clearing house that too much had been
loaned on Tennessee Coal and iron
collateral. Stock brokers told me
that as a result of this Investigation
a gentleman was invited to Mr.. Nor
gan's house. Mr.. Morgan suggested
To him that to relieve the situation
the United States Steel corporation
might acquire the Tennessee Coal ana
Iron company. That led up to the ne
gotiations afterward concluded"
Mr.. Stanley wanted to know If Mr..
Morgan and others had ever tried to
acquire the Tennessee company be-
fore. with a view to securing a mon
opoly. Mr.. Gates. said he could not
tell what was in the mind OF the
nprchasers. He outlined at length the
sale of stock to the United States
steel corporation. He said that in
1904 or 1905, during his absence IN
Texas. a syndicate was formed, man
aged by Grant B. Schley, and Charles
Guthrie. the president of the Re.
uublic Steel and Iron company, which
nurchased the stock of the Tennessee
Coal and Iron company. He related
how Mr.. Guthrie died soon afterward
and S. c. Hanna, brother of former
Senator MARK Adniid, Hou p0Oh ln"NN
associate manager.
I'm July, 1907" said Mr.. Gates, 81
sailed for Europe. returned in Nov
ember. 1907, and on the shipI bought a
paper and read that the stock of the
Tennessee Coal and Iron company had
been sold to the United States Steel
corporation. The panic was on then
met Mr.. Schley at his office as soon
as I reached New York and found
negotiations going on between Mr.
Schley, Mr.. Hanna and their asso
ciates, and Judge Gary, Mr. Frick and
Mr.. Morgan. The latter were ther
in conference at Mr. Morgan's house
trying to acquire the Tennessee Goa
and Iron stock. The terms proposed
were that for each ten shares of Ten
nessee Coal and Iron stock we were
to get United States Steel second
fves mortgage bonds. said it was
not enough and held out until W.
made a trade on the basis of 119% il
United states Steel sinking fund f1ves
The next day / insisted that the min