The New York herald., 1922-06-03
Cash Balance si25.ooo.ooo.

the corporations surplus, then SAID ne
would guess" a00.ooo.ooo
Cash Balance si2o.OOO.OOO.
Questioned regarding the corporation
cash balances Judge Gary said they
We're in the neighboVhood of about
Sle5, 600 and that about ss,00o,0C0 oi
that amount was kept on deposit will
J. r. Morgan G. Co. at &c per cent
interest.
You don't borrow any money from
Morgan's?" asked Mr.. Untermyer.
I'VE don't borrow any money from
any one''
"Infact, you lend money in the Street
don't you, on call?"
mo" replied Judge Gary.
"Well Morgans lend the money--they
lend your money and get anywhere
from to and s per cent. as the
market permits. don't they?" Mr.
Untermyer asked.
II don't know. I cannot answer"
Q. Don't you think that is a yer,
vicious practice of a great corporation
keeping its money with private bankers
who simply use it for their own pur-
poses and make profits on it and de-
posit in their own banks and get control
and power in their banks through the
use of the moneys of these corpora
tions? A. All the banks in which we
deposit our money do the same thing
I suppose. They make some money ou
of it.
O. You know that that practice wa:
criticized in the money trust investisa
ton, do you not A. remember ina
investigation in a general way.
@. How long have you been getting
interest on these deposits? A. Eve'
since we have had any there-aiways
There have been times--a comparatively
short time--we got only per cent
and there was a good deal of discussion
between Mr. Morgan and myself in re-
gard to that / wanted per cent
and he thought 2H per cent. was liberal
@. And you compromised at two anc
one-half per cent? A. We compromised
at two sixty. yes. that is right.
@. BY the way. Judge Gary, the Nor
gan firm virtually names the directors
OF the steel company. doesn't It! "A
No. they do not. certainly not.
O. Now let us see about it. Do yor
remember Mr.. Morgan was testifyine
before the money trust Investigation
A. No. I do not I would be very mucf
surprised II he testified to that.
O. Well. he did in effect? A. Tha'
is that he did it then or that he die
in at the beginning?
Choosing of Directors.
O. No. he did it then. Who name,
the directors? You know the stockhold.
ers do not name them? A. i think
viii have to admit and perhaps claim
that / do more of that than anybody
else and always have.
O. You do Ii in consultation VIII
whom? A. All the directors.
Q. How many of the Morgan direc'
tors are on your board? A. One.
O. One nowhere were more? A
There were at the start.
O. And for many years. A. Well. yes
O. Which Is the one now? A. J, +
Morgan.
q. And as vacancies occur in The
lbcard you designate the directors. IT
consultation with Mr.. Morgan. do yot
not? A. Not any more than the othel
members of the finance committee.
O. Now. don't you know, Judge Gary
IN point of fact. that these directors are
really named by you and Mr.. Morgan
or by Mr. Morgan after consulting you!
A. do not. That is not fact.
O. Have you ever named director
without the assent Of J. p. Morgan
Company, and. II SO, give us his name
A. do not think ! have--or without
the assent of every other member OF the
finance committee.
The members of the finance commit
tee of the Steel Corporation are: Judge
Gary. ]. p. Morgan, George F. Baker
Pichard v. Lndabury. Percival Roberts
Jr.. ]. A. Farrell and William J. FIJI
bert. Mr. Unterrnycr pursued his in
utriry into the Morgan influence I'm the
corporation.
Q. And you consult these other
gentlemen on the finance committee
A. Yes.
Gary and Morgan Disagreed.
o. But you pick them out. and theu
YOU consult them? A. Now. may / add
something there? ! want to add this
During the last year Mr.. Morgan and
did not agree with respect to filling
vacancies in the directors.
Judge Gary at this point sought 10 ex-
plain that in the early days OF the
steel Corporation he and the late J.
Pierpont Morgan frequently disagreed
on matters OF policy and appointments
and that the elder Morgan frequently
Yielded.
But n you had not been able TO con-
vince him his judgment would have had
TO prevail?" Mr.. Untermyer suggested
81 am not willing to admit that" said
Judge Gary.
Q. You have not had such case,
have you? A. have attempted to
make the statement that Mr.. Morgan
and Mr.. Morgan's firm. from n very
early period OF our history. had never
been. nor attempted to be. the domi-
mating factor in the control and man.
accment Of the corporation.
Gary Offers TO Illustrate.
@. That is very general statement.
md IL depends n good deal upon what
has been dons Judge Gary. A. could
give you a good many Illustrations.
O. Could you give me any illustration
in which anything has ever been finally
done against the judgment and wishes
~ that firm A can nrainat thn