Evening star., 1933-06-02
Hearing Recessed When
Pecora Questions 7. S.
Lamont on Sales Believed
Related to Income Tax.
PARTNER IS GIVEN TIME
TO PREPARE ANSWERS
Whitney Describes How Bankers
Worked Together in Effort to
Halt Fall Of Prices Late in 1929,
but Objects to Use of Word
POOL in Inquiry.

POOL in Inquiry.
BY the Associated Press
The Senate investigation of ].
p. Morgan & Co. was abruptly re-
cessed today until Monday after
John w. Davis, counsel for the
firm, protested against question
directed at Thomas s. Lamont,
junior partner, apparently relat-
ing to his income tax return.
The protest arose shortly after
George Whitney, another Morgan
partner, had given the inside story
of huge market operations to stem
the market fall of late 1929
operations consisting of a Seven
member banking pool with $780,
600, 900 to invest that prof1ted the
Morgan firm more than 81 ,000, 900.
The objection to the questioning
Of Lamont came when the white
haired Davis, former presidential
candidate, leaped to his feet after
Ferdinand Pecora, the committee
counsel, called Lamont to the
stand and asked him about sales
Of stock December 80, 1880.
Davis protn~fs
"This is not fair play" Davis pro-
tested, asserting that Lamont had not
been advised he would be questioned
about the stocks.
while lamont sat quietly at the table
and his senior partner, j. r. Morgan,
listened intently from the background.
Davis and Pecora argued the question.
Chairman Fletcher finally ruled the
question was pertinent
Lamont then said he did not recoI-
lect about the sales and he was directed
TO look them up over the week end.
Davis asked Chairman Fletcher for q
meeting Of the committee Monday be-
fore the resumption Of the inquiry, pre-
SuI0dDly 10 QSC10S WGEbk1EI EEGOIAS
question was pertinent.
The sudden cessation of question and
answer caught everybody by surprise.
Lamont had been on the stand a
very few minutes before the clash oc-
CURED. He was the third Morgan
partner to be examined.
The question which started the dis
pute was an inquiry by Pecora to La
mont whether he remembered he had
sold on December 80. 1880, the follow
ing blocks of stock:
1900 shares of Continental Oil.
200 Durium Products.
500 Hall Electric Heating.
237 P. r. Mallory Co.
1000 Shamrock Oil and Gas.
500 State Street Investment Co
$50 Investment Corporation Of Phil
adelphia.
1000 Simms Petroleum.
PecOra Won't Explain.
After the recess was taken Pecora
refused to reply to questions from news
paper men whether the question had
any connection with the question Of in
come taxes.
Previous testimony before the COM
mittee had disclosed that the 20 Morgan
partners paid total of $4,000 income
tax in 1890.
Although he was excused as witness
today, j. P. Morgan told reporters: Il
think I'd like to see the end of this.
I'm not certain, but I think I'm coming
back"
He hasn't testified since the first two
days of the inquiry.
The partners instructed to return in
cluded Whitney, Thomas w. and
Thomas S. Lamont, Arthur w. Ander-
son, Harold Stanley and William Ewing.
In regard to the market pool Whitney
testified that although loss had been ex-
pected, the 1,146,609 shares purchased
were sold for $1,067,355 more than the
cost, exclusive of interest
Bought 1,146,e0s Shares.
The massive purchases lasted some
three weeks.
"It ended, as I recall, on November
H." said Whitney quietly, while ears
were strained throughout the large,
crowded room to hear.
Leading up to his story IN answers
to Pecora, the witness related how his
brother Richard, then vice president
and now president of the New York
Stock Exchange, had come to see us
first" about doing something to halt
price slides on the exchange.
How much did you buy?" Senator
Couzens. Republican. Of Michigan
asked.
I'VE bought 1,14e,sos shares" Whit
ney replied, "at cost of $137, ,752. .705."
We sold out in 1880 for $13S,820.-
060."
How was the profit divided?"
Couzens wanted to know.
Among us according to participa-
ton" Whitney said. I'VE entered this
operation without thought OF profit.
We expected to take a loss and at one
time our book loss was $40, 900 ,0o0p
Why did you take such large loss
on Anaconda Mining Corporation?''
Couzeps asked.
"As said" Whitney replied, I'VE
sold without reference to profit
The witness objected to Pecora's use
of the word pool to describe the
transaction.
I'VE are rather gunshy Of the word,
as used colloquially," he smiled.
But the newspapers called it the
bankers pool, Pecora commented
yes, Whitney agreed, I'VE tried to
set them right, but they paid no attene
ton"
Spectators laugher, and o smile
spread momentarily over the hitherto
impasSive face Of J. p. Morgan.
Whitney testified that he directed
Morgan q Cos participation iIl the
Continued on Pase I. Column -
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