Evening star. [volume] (Washington, D.C.) 1854-1972, 1912-12-19

the Cleveland. Cincinnati. Chicago and
81. Louis railroads. Mr.. Morgan said
that some issues of the New York Cen
| trail securities had been made in the last
ten years through other bankers than his
| house.
Il can't recall any. but think there
were some.' said he.
| I'm the last five years.?
Il don't remember of any-none that ]
| can recall just now
! His firm would furnish information on
! that point. Mr.. Morgan said the firm
| mad handled several hundred million
dollars worth of New York Central Sc
curities and he thought that in the last
ten years those securities had all been
handled on commission basis.
Mr. Morgan thought the New Haven.
! too. had ISSUED securities not handled by
Morgan & Co in the last ten years.
Terms Given New Haven Road.
Mr. Untermyer read from the papers
furnished by Mr.. Morgan the proposal
from the Morgan house accepted by the
New Haven. Morgan & Co. proposed in
return for being made sole fiscal agents
for the New Haven lines to loan the New
Haven road 30 per cent of the agreed sale
price of its securities, at reasonable
rate of interest. and to give the road the
benefits of counsel and advice"
This proposal was accepted January
-, I'lI. pS ire Name central; december
2S. 1910. by the Eoston and Maine. and
December 10. 1910 by the New York. New
Haven and Hartford. the acceptance in
each case being signed by Charles S.
Melen.
"Can YOU give us from memory a list of
other interstate corporations for which
you are fiscal agents." asked Mr.. Inter
myer.
Mr.. Morgan could remember no others
except the United States Steel Corpora
iyna to hn mn lloY
Mr.. Morgan said his firm had supplied I've
committee with data on that point. MIR.
ntermyer replied that such data in
cluded only those corporations with which
Morgan & Co. had formal agreements.
Mr.. Morgan said his firm acted for the
American Telephone and Telegraph Com
pany, the Northern Pacific and the South
ern railroad, although they had no agree
mentS with them.
Northern Pacific Reorganization.
Mr.. Untermyer took up the Northern
Pacific reorganization.
WAS that property reorganized under
voting trust?''
Mr.. Morgan said it was. and that he
was member of the voting trust.
In that connection" he added, I'D
like to present these reports of the voting
trustees for the Northern Pacific and t..e
Southern railway
MIR. Cntermyer looked at the reports
Mr.. Morgan presented and asked if they
were not arguments by the voting truS-
tees in behalf of their good management"
MIR. Morgan replied they were the reports
of the trustees. and Attorney Lindabury
interpOsed to say they were accounts of
the stewardship of the voting trustees
Open Market for Securities.
Don't YOU think that interstate cor
he fn
their securities in the open market. and
not be tied up to one firm. no matter how
just its methods" asked Mr.. Untermyer.
NO. not necessarily replied MIR. Nor
gan. Taking up the Southern railway
situation. he said he saw no objection to
directors appointed by himself, men,
Der of a voting trust. entering into a fiS
cal agreement with his own firm. Mr.
tntermyer asked if Mr.. Morgan did not
think securities of Interstate corporations
should be sold in open competition, as
were United States bonds
Il do not said Mr. Morgan. He said
there was plenty of competition for rail-
road securities.
MIR. Untermyer asked where there
could be competition between the New
Haven road and Morgan company in the F!
sale of New Haven securities.
They may want great deal more for |
them than we think they are WORTH said |
Mr. Morgan.
DO you think it would be better for the |
railroad TO he able to offer it's securities |
to another banking house?''
Moral Strength of Agents Standing.
NO. 1 do not returned Mr. Morgan !
He added that the position of the bank,
ing house often had much to do with |
the stability and success of corporations.
There's another point about it, he |
added. You must remember that all se-
curitieS sold and issued are not always
good. and when there is responsible
agent there is moral strength behind
them"
road bond proving bad, where Your firm
has had to pay the loss?" asked Mr.. Tn
termyer.
II can't remember any case. but 1
know there have been several" said Mr.
Morgan.
''-All of that comes out of the security
holders?'
NO, out of the property.
But that eventually out of the security
holders suggested the attorney Look
over the whole history of the railroad
business and see if you can find one case
where the banker has had to stand the
loss
well. I've had a good deal OF railroad
ing" interrupted Mr.. Morgan, with a
smile.
Yes. that's why I'm asking you about
II, reJOlneO Mr. nteTmyef-
Mr.. Morgan said he could recall no
specific case.
Selecting Steel Trust Directors.
Mr.. Untermyer turned to the fiscal ar
rangement with the United States Steel
Corporation.
Didn't you name the entire board of
directors of the United States Steel Cor
poration?" asked Mr.. Untermyer.
II think 1 passed on it,
But didn't you hand out a slip con-
tanning the names.
IF passing on the board is naming it,
i am quite willing to assume all the re-
sponsibility." said Mr.. Morgan.
But didn't you say who should go on
and who stay OFF," persisted the lawyer
II possibly did the latter" replied the
financier, and a laugh swept out from the
crowd.
Mr. Morgan said he had not passed on
all who went on the board of the Steel
corporation, but said no members had
ever gone on the board against his pro-
test.
Mr. Cntermyer asked If Mr.. Morgan
had not named Judge +. II. Gary for
chairman of the Steel corporation finance
committee when George w. rerkins re-
signed.
Il think so. It's very probable.
don't remember now.
who fixed the prices at which various