Harrisburg telegraph. [volume] (Harrisburg, Pa.) 1879-1948, 1914-03-18

Fear is the greatest enemy security
owners have to cope with. Some one
OF importance says something detri-
mental about stock or a bond, and,
pell-mell, investors, without thinking,
assume there exists a concealed condi-
ton of rottenness and they scurry to
get from under. This sort of flight
out of their investments occurred
among the roads security y-holders as a
result of Commissioner Harlan's criti-
cism Of the St Pauls methods of
bookkeeping. All the security-hol
could see in their panic of fear was
another Frisco or Rock Island affair.
and they fastened to unload so as
not to be caught in the swirl of liq-
uidation. 1t was a slaughter of the
innocents for neither the roads Of
ficers, directors. nor it's bankers were
the sufferers, as they knew that Com
missioner Harlan criticised the meth
DDS of a by-gone period, and in no
way brought into question the COM
pany's solvency or it's prosperity. The
feeling is growing that the Interstate
Commerce Commission should so word
Its criticisms that the effect would not
be to needlessly frighten investors
the Commission was not created for
that purpose.
Considerable amusement was af-
forded Wall Street bankers, who are
familiar with Samuel Untermyer's
never-ceasing activity as counsel for
reorganization committees by the
pointed questions of Senators Hitch
cock and Weeks when Uptermyer as
sumed the role of protector for the
people before the Senatorial Commit
tee hearing expert evidence on the
owen measure to regulate speculation.
Senator Hitchcock asked Mr.. Inter
myer about some of his own expert
ences with the Wall Street game, and
finally extracted from him an admis-
sion that If his transactions were
wrong they were mistakes due to his
inexperience and youth. Untermyer
has grown wealthy from fat legal fees
earned as counsel for corporations in
distress, and cannot be classed as a
novitate. Both Senators Hitchcock
and Weeks seem to thing Untermyer
has personal grievance and is utiliz-
ing the radical element in Congress
to serve his own purpose, rather than
the best interests of the public.
For some people there Is a great
deal more money to be made out of
reorganizing big corporations than in
creating them. If this were not true
fewer corporation lawyers would make
their headquarters in Wall street.
| Within the narrow confines marking
the boundaries of our financial district
there are more lawyers to the square
foot than on any other prescribed spot
In the United States. They all seem
to make good money acting as coun-
selors to the financial doctors" usual
ly self appointed, to attend to the ills
of embarrassed corporations, while the
security holders are the ones who pay
their fat fees. A committee was
formed only a few weeks ago to look
after the interests of bondholders rep
resenting an issue of in excess of $780,
100000. The fee each bondholder will
have to pay is five dollars for each
thousand bond. or one-half Of one per
cent. Yet this apparently small fee
will aggregate $S50,000 for the entire
bond issue; a pretty stiff sum to divide
among six or seven committee mem
bers and attorneys. / cite this instance
as an illustration of many similar in
jstances.
New Haven was helped by the ad-
mission made by Morgan & Co. that
the profits it made from handling the
roads securities over the space of
nearly twenty-five years, was less than
100000 though during that time ii
sold securities amounting in all to
> nearly a third of billion dollars Nor
gan & Co. also categorically disclaimed
that the firm or any of it's eight mem
bers, participated in any deals or rake
offs. Further analysis of the Morgan
statement shows the interesting fact
that if the profits were divided among
the eight members 1t would figure out