New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1911-08-03
SCHLEY SAYS DEAL WAS
NOT MADE TO SAVE HIM
Leaves SiCkbed to Tell His Ver-
sion of Absorption of Ten
neSee Coal and Iron.
"MATTER OF BUY AND SELL"
Believes Moore & Schley Would
Have Pulled Through-Hints
Roosevelt Was Misled-
Gary offered 60, Paid Par.

Gary Offered 90, Paid Par.
Grant 3. Schley. Of the brokerage firm
OF Moore & Schley, whose financial diff
fculties during the panic in the fall Of
1907 were repeatedly suggested by wit
nesses from the United States Steel
Corporation as the prime reason for the
absorption of the Tennessee Coal and
Iron Company by the Steel Corporation,
in order to allay the condition OF finan-
cial unrest in Wall Street at the time.
was the only witness examined yester-
day before the House committee investi-
eating the steel situation.
Mr.. Schey literally left a sickbed at
his country place. at Bernardsville.
y. j.. 20 attend the hearing. He vas
pale and weak, and il was apparently
an exertion for him 10 keep his voice
al pitch so that all the committeeman
about the table could hear his testi-
mony. He was on the rack as witness
FIVE hours. Congressman Littleton con-
Quoted the major part of the examina-
ton.
Gary. Henry c. Frick and other wit
nesses that the Tennessee transaction
was carried through primarily TO save
the firm of Moore & Schley from failure
and thereby avert the spread Of further
disaster during the panic. He said he
had not advanced that as an argument
in his negotiations with Judge Gary, Mr..
Frick or representatives of the firm Of
j. P Morgan & CO. II had been merely
e matter of buy and SELL" he said. He
would not admit that his firm was on
the verge Of failure and would have gone
under II the Steel Corporation had not
come TO the rescue.
I'VE Would Have Pulled Through"
Our credit was extc.ded more than
Il should have been at the time he
said The situation was serious; we
couldn't tell what tomorrow would
bring forth. but believe we would have
pulled through"
Did Judge Gary or Mr.. Frick say 10
you at any time that they didn't want
the Tennessee stock, and that the only
reason they would buy it was to save
the firm Of Moore & Schley from fall
ure?" asked Mr.. Littleton.
mo. not to me" replied Mr.. schley.
Did you ever tell MIR. Ledyard TO tell
Mr.. Morgan that it would be necessary
10 sell the Tennessee Coal and Iron stock
10 save Moore 6, Schley?" asked Mr..
Littleton.
NO. I never did" Mr.. schley answered
emphatically.
can you say that the sale Of the
Tennessee Coal and Iron stock did save
Moore G. schley from failure?' pursued
Mr.. Littleton.
NO. l can't say that" replied the wit
ness.
Mr.. Littleton read extracts from ex-
President Roosevelts letter to the At
torney General subsequent to the visit
O: Judge Gary and Mr.. Frick to Wash
inrton. when they obtained the Presi-
dents opinion that the Tennessee trans
action was legal and would not be the
subject Of attack by the government. II
appeared that the failure OF "a certain
brokerage firm meaning Moore &
Schley) and the consequent disaster
which would follow in its wake had been
advanced to the President as a primary
Nreason for the transaction.
" Mr.. Schley intimated that if Mr..
Roosevelt had been led TO think that
was so at the time he had been mised.
Nj 0n-iyeN 7 &. and |.
The witness said he never knew there
had been a general drive" on the Ten
nessee coal and Iron stock at any time
during the 1901 panic. The banks had
not Disseminated against the Ten
nessee stock as collateral any more than
any other stock which was classed as an
Industrial" The Moore & Schey loans
were secured. az rule. by 40 per cent
of railroad stock, or some other stand
ard stock, and 80 per cent Of industrial
stock. ne said. The firm had Outstand-
ing loans Of about S33OO0OOO at the
time If the panic, and the Tennessee
coal and Iron stock figured largely on
he 30 per cent side Of these loans The
latter stock was used to 'sweeten' the
loans. Mr. Schley said.
Mir. Littleton referred 10 the banks
which had loaned money TO Moore e
schley. and asked If there had been a
loan with Morgan & CO.
"Yes. they lent us $1,jO0000,' said the
witness.
How much OF the 80 per cent Of in
dustrials covering that loan was Ten
nessee Coal and Iron stock asked Mr..
Littleton.
Il could not say" was the reply
Mr. Schey added that the Morgan