New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-03-01


Group owe: he money and credit or IN
country controlled b. our largest man
ciai institutions ana that - avai!aD!
Cor financing large security issues 10
the current needs OF our principal n
terstate corporations and % The iAo!
viduals conducting great enterprise
and Tor STOCK exchange loans is AZ leas
as effective as. for instance. is me con
,rol Of tAe United States Steel Coipo
ration oye- the stee! INDUSTRY IS
,,pderstate ment OF the situs ,ion, "a
though tie methods oy winch tHls con
,rol IS effected and held together are
Of course. essentially different ana U
:, more loose and intangible character.
Personnel 81 Money Trust.
The report goes on to say 'hat u
parties 10 this combination OF uhue'
standing or community u interest, .
whatever name ii may he called ma
be conveniently cla ssiiied. for the pur
pose OF differentiation, into four sepa
r;t,a croups. which II gives az FOLLOW
FTRST.-Ihe INST. which for con-
,enience OF statement We vii. call
tho inner group. consists or j. 4.
Morgan a. Co. the recognized Lead
crs. and George r. Baker ana
James Sti.lman in their individual
Capacities and in their )oint admin
istrat ion ana control Of the FRS,
National Eank. The National CITY
Bank. the National Bank OF Com
mercc. the Chase National Bank.
the Guaranty Trust Company and
The Bankers Trust COMPANY, WIth
total known resources, in these cor
porations alone, IN excess OF Sl.aD.-
10000. and Of a number Of smaller
but important financial institutions.
This takes no account OF the per-
sonal fortunes Of these gentlemen.
SECOND-Closeiy allied with this
inner or primary group and. indeed,
related TO them practically as part
ners in many OF their larger ilnan-
cial enterprises. are the powerful
international banking houses ot
Lee. Hgginson & Co. and Kidder.
Peabody e. Co, with three affiliated
banks in Eoston-the National
Sha wmut Bank. the First National
Bank and the Oid Colony Trust
Compa ny-haVinS ABOUT tvo-thirds
OF the total resources OF all the Bos-
ton banks: also With interests and
representation III other important
New England financial institutions.
TEIRD-In New York City the
international banking house OF
Ncssrs. Kuhn. Loeb & Co. with It's
large foreign clientele and connec-
tions, whilst only qu&lifiedly allied
with the inner group, Yet through
it's close relations with the National
City Pank and the National Bank
Of Commerce and other financial in
stitutione. with which il has recent
~ allied itself, has many interests
IN common. conducting large joint
account trsnss ctions with them. es-
pecially in recent years, and having
what virtually amounts 10 al un-
derstand!ng not 20 compete, which
is defended az a principle OF bank
ing ethlcs." Together they have
.i.h feN exceptions -empted
.ao banking business OF the i'm
'urtant railways Of ths country.
FOCRTH-in Chicago this inner
group associates With and makes
issues o. securities in joint &C.
count. or through underwriting par
ticipations primarily With rhe First
National Bank and the Illinois
Trus; and Savings Bank. and has
more 0! less friendly business Teia-
tons with tho Contineata, and
Commercis! National Bank. which
participates in the underwriting OF
security issues b. the inner group.
These are the three larsest :.nan-
ciai ins;itations IN Chicago. with
combined resources Including the
Two aailiated. ard controlled STATE
institutions Of The TWO national
hanks) 81 1861 000. 600.
FIFTH - Hadlstins from these
principal groups and closely anil
ate5 with them are smaller but IN
portan. banking houses such as
Kisse,. Kinnicutt e. CO.. While. Weld
& Co. and Haryey Fisk g. Sons who
receive large and lucrative patron
age from the dominating groups.
and are Used by the latter az ioo-
bers OF distributors OF securities the
issuing OF which they control. but
which for reasons OF their own they
prefer moi 20 have issued or dis
tributed under their own names.
Messrs. Lee, HigE!nson 4 Co.. be.
sides being partners with the inner
group are also frequently utilized
in this service because OF their
facilities as distributors o. securi-
ties.
SMITH Beyond these inner
groups and sub-groups are bank.
and bankers throughout the coun-
Try who cooperate with them in
underw riting or guaranteeing the
sale OF securities offered TO the pub
lie. and who also act as distributors
Of such securities. II was inpos-
sib'c 10 earn the identity OF these
corpora tions owing 20 TIE unwil-
lineness OF the members OF the in
,,.r erro,tn I'm dieclose ria pop7ES ~