Evening journal., 1913-10-01
NEW NEWS OF YESTERDAY
An Obstacle in the Way Of
Making Securities
BY Holland.

"Henry NJ Whitney, who is an Older
brother of the late William G. Whitney,
and who is regarded by those who know
both the brothers intimately, as the
ADLER man of the two, had an experience
I'M the school of very high financing
some thirty years ago which presume
he viii never forget This statement
was made to me by the late Charles +.
Coz. who for many years was one ot
the high executives of the Vanderbilt
system of railroads and who received
his early training in business and rail
road life while associated with his broth.
or. Jacob d. Cox who WAS at one time
governor of Ohio and who was secretary
of the interior m the first two years OF
President Grants first administration.
"Of course. I cannot vouch for what
! am about 10 tell YOU from any per
souul experience, but got the anec'
dote from man in whom ! have per
feet confidence said Mr. Cox.
Henry NJ Whitney, with a few other
men of capital IN Boston. got control
of six OF the leading street railway
companies in that city about the year
1890 Tho combination by them of these
railroad lines met with tho full appro-
val of the Massachusetts, Railroad Com
mission II was successful. both from
the business point of view and from
that OF the service given 10 the people
of Boston.
"Onc day Mr. Whitney and his as
sociates received communication from
group of capitalists that had been
prominently associated with the at
tempt 20 consolidate some of the New
York street railways, asking for a con-
ference. fhc place designated was "A
I parlor in the Adams House, in Wash
/ inaton street. ma Boston.
"The conference was agreed to, and
Mr. Whitney and his associates met
the New York group of capitalists,
some Of whom we're In business rola-
tions with william c. whitney.
"One Of these capitalists said: II
don't think it is worth while to waste
any time in the way Of preliminaries.
We own a little street railway prop
erty in South Boston, which is inde-
pendent of your system. We know
all about your railway properties
You don't need to offer US any in
formation. So we will come right to
the point. We want to know whether
you will sell your properties to us
and If So what your figures will be-
Before an answer could be given
to this question another one of the
New York capitalists said. We have
been looking into your earning ca
pacity and have discovered that your
earnings justify very much larger
capitalists and large issue OF
bonds. II we can come to an agree
ment about the price we intend &c
issue a new capital stock and cor.
responding amount of bonds And
am certain that we can market then
because the earnings here seem tS
justify them
Then one of the Boston capitalist
said: That is all very we'll and it il
something that you can do in New
York, but It can't be done Lere. Yol
can't do it,
"'Why not?'
Because the laws Of Massachu
setis won't permit it Bonds must rep
resent actual expenditures upon tn
properties
"'Will you let US 60 and consult wit
our lawyer so we may know whethe
YOU are rghty'
"'You couldn't do a better thing
$50 the conference was adjourned ia
two or three hours and AT the appoint
ed time these mon Of business me
again. Tho New York capitalists foun
that tho Boston man was correct an
the proposition was withdrawn. w
don't want 10 enter into business IN an
town or state where we are prohibite
from making securities just as "a
choose 20. We can do that in Ne
York they declared.
II often think" said Mr. Cox. "no
that the street railroad properties ha'
gone into bankruptcy through the owe
rating Of them by men who knew no
TO make securities, "that Mr. Whitns
must have recalled this Boston exper
ence when he heard Of the bankrupt
Of the New York street railway con
pany."
Copyright, 1913, by r. J Edwards
rights reserved.l
Ton,orro,v Mr. Edwards will toll