The Sentinel=record., 1911-06-03

WdTu panic ana III the pFeSiuenJ Oh
the department of justice should fine
out that such action was being taken
and should enjoin us on the ground
that the acquisition or holding OF the
stock created a monopoly, what we
had done would make the financia
situation much worse than it is now.
"Mr. Morgan said this was a forci-
BILE reasoning
Mr. Gary said Mr., Frick agreed with
him that the stock was not worth
more than 65. The finance committee
of the Steel Corporation was summon
cd to the Morgan library
Mr.. Frick." according to Mr.. Gary.
Offered resolution proposing that
We offer tc loan Mr. Schley y5,0O00O
or sc. 100000 in cash, taking the Ten
nessee Coal and Iron Company secur-
tiles as cllateral. If that offer failed
to supply Mr., Schley's wants, 1t was
proposed to buy the stock on the bas-
is of 80 payable in Steel Corporation
stock. Mr.. Frick and myself conferred
with Schley and tried to get him TO
take the loan. We did not want the
stock. =
Mr.. Gary said Schley told r'rlck ne
must sell the stock to keep his firm
from bankruptcy: that unless he was
mistaken an assignment already had
been drawn up for Moore and Schley
for their creditors.
Il have heard since,v said Mr..
Gary, that Schley said he could have
gotten through all right, but any one
who heard him at that time would
not have thought so Therefore be
gan to talk to Ledward about pur-
chasing the stock at 80 and We finally
agreed to 1t, subject to the objection
that might possibly be made in Wash
! ington.
"We were all clearly OF the opinl
ion," said Mr. Gary to Representative
Iittleton. that the attorney genera
might not have the right to endorse
the transaction.
The Steel Corporation. he said, had
at that time about s75.000.00O on de
posit in banks; and could not have
withdrawn more than s5.OO0,oO0. with
out creating great financial dIstur.
bance.
After the agreement had been
made to take the Tennessee stock al
90,' said Mr.. Gary, 'Ledyard. an et
torney f0r the controlling interest IN
the Tennessee company. said Schlet
had tod him that the price OF W
could not let them out OF their diff
culties. notice that Gates says in his
testimony that when he got home
from Europe he made them raise the
price in the transaction. II he made
that statement II must have been by
Marconi. because the Whole transac-
tion was closed before his arrival
from Europe"
Subsequently. on November 4 the
finance committe of the steel cor.
poration. met again and agreed TO buy
the Tennessee Company's stock al
100 in order to allow Moore and
Schley to pull through and an ar
rangement was made over the tele
phone with President Rooseyeit's pri.
vate secretary for an interview with
the chief executive concerning the
probable legal barriers in the way oi
acquiring the property. Mr.. Gary ana
Mr. Frick went to Washington b
special train and on Monday Noyem.
Der S. interviewed the president.
After hearing our story" contin
ued mir. Gary. z the president said he
would like to consult with the de
partment Of justice, Mr.. ,Bonaparte
was out OF town and the presiden
called Secretary Root into his office.
The president asked me again to state
the case. ! did and the result OF the
interview I Immediately wired to New
York.
did the president ask Secretary
Roots opinion as to the legality OF
the transaction" asked Mr.. Little
ton.
'He did, sair Mr.. Gary. and there
was no disagreement between any OF
us.
| Mr.. Gary then told the committee
that two days later. on November q
he wrote Mr.. Root sketching the con-
versation with Mr.. Roosevelt. who,
Mr.. Gary says. was told that the stee
corporation had an opportunity TO
purchase the Tennessee company's
stock at slightly more than II was
worth but that the purchase would
greatly benefit threatening financial
conditions and avert the failure OF an
important concern.Mr Gary said be
stated In his letter that he understood
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