Fergus County Democrat. [volume], October 29, 1907, Page 3, Image 3

About Fergus County Democrat. [volume] (Lewistown, Mont.) 1904-1919

Image provided by: Montana Historical Society; Helena, MT

                
THE REAL REASON
OF HEINZE FAILURE
OTTO HEINZE BLAMED FOR
THE TROUBLE IN UNITED
COPPER DEAL.
It was a peculiar and almost dra
matic feature that the cause of the
collapse of the copper company's
shares should have been directly due
to the mistakes of the Heinze firm,
says the Chicago Record-Herald. All
Mr. Heinze's friends insisted that the
blow to his prestige and the collapse
of his capital came from within his
own circle of acquaintances. The
blame was laid at the door of his
brother, Otto Heinze. It was stated
with great regret by the Heinze ad
mirers that the man who fought the
Standard Oil company to a finish and
fought off repeated disaster in the
money market, in the courts, in pol
itics and in the copper fields of Mon
tana, was now facing defeat as the
result of a mistake made in the great
game of finance in Wall street.
The story of the error committed
by Otto Heinze & Co. reads like a
chapter in romance from one of
Thomas W. Lawson's fictions. Told
briefly, the Heinze brokerage firm
attempted to teach those who had
sold United Copper "short" a bitter
lesson and at the same time profit by
the necessities of those who had sold
that which did not belong to them.
Accordingly the plan was put in op
eration.
On Saturday last there war r. wide
Ot-tn break in United Copper stock;
it declined from 46 to 37 1-4. The
Heinze brokerage firm believed pool
stock was being unloaded on them.
The stock was fairly widely scatter
ed in a score or more brokerage
houses which had obtamed loans
fr..m their banks with Um.ed Copper
as a portion of the collateral.
Or Monday the Heinze firm
sprang its plan. Notices were sent
out to the score or more brokerage
firms who held United Copper as a
part of the pool plan to deliver the
stock to Otto Heinze & Co., who
would take it up and carry it. By
this plan it was thought the Heinze
men would discover the persons who
sold the stock short end at the same
time thev would compel the outsider
to buy back the stock.
This scheme failed in execution. On
Monday the stock was bid up and
sold at $60 a share. On Tuesday the
brokers received the notification to
deliver the stock before the usual de
livery hour to Heinze & Co., and
scores of them did so much to the
amazement of Heinze & Co. The
brokers gathered in from those nooks
and crannies where it is never sup
posed there is any stock.
Despite the arbitrary action of the
Heinze firm to prevent the delivery
of certain stock, amounting to 17,
330 shares, on the plea that the trans
fer agent would not receive it, the
stock came pouring in. In addition
the Heinze firm attempted to hold
the market and effect the corner in
the stock that they had hoped to
create. In these efforts they bid for
stock at high prices. Their brokers
whom they designated to buy the
stock to carry out their purposes,
were loaded up with United Copper
at prices ranging from $50 to $60.
It is understood that Gross &
Kleeberg accumulated 6,000 shares
at the direction of Otto Heinze &
Co. to whom the former firm looked
for payment today. When it was
forthcoming it was immediately de
cided to adopt the rules of the New
York exchange and announce their
inability to meet their contracts. This
was done soon after the delivery
hour passed on the exchange. This
failure mav involve $1,000,000.
Where Heinze & Co. committed
the most serious error was in not
arranging the proper banking fa
cilities to pay for the incoming stock.
As suggested, Otto Heinze did not
expect that much stock could be de
livered to him on Tuesday and that
he would force a settlement of the
shorts and make United Copper more
secure than ever.
A cog slipped in the plans, how
ever, and he was overwhelmed with
United Copper, which he had to pay
for. In other words, he pulled down
the structure F. A. Heinze and Arthur
P. Heinze had so carefully reared and
defended in the long years of strug
gle wtih financial and political ene
mies here and in the west.
During the morning, when it was
seen that a crisis was impending in
the affairs of his brother, F. A. Heinze
visited Charles W. Morse. Many
bankers were there, as were trust
company and banking presidents.
Charles D. Barney of the Knicker
bocker Trust company, and Miles
O'Brien, vice-president of the Mer
cantile National bank were among the
conferees. It was then stated that
the Morse-Heinze group had not
quarreled, and in all probability a
syndicate would be formed to tide
the Heinze firm over for a year by a
loan. If this was done it would save
Gross & Kleeberg and Otto Heinze
& Co.
Other firms which had been caught
in the effort to effect a corner in
United Copper and had sustained
severe losses in consequence were
able to weather the storm, it was
said, by obtaining assistance from
other quarters. In this connection
the names of three stock exchange
houses were mentioned as having had
succor extended to them.
According to the statements made
after the conference the liabilities of
Otto Heinze & Co. to members of
the stock exchange amounted to $4,
700,000, all of which was involved in
United Copper transactions. It was
further stated that $750,000 when
raised by the members of the syn
dicate would prevent any trouble for
the Heinze brokerage firm.
These bankers were very explicit in
stating that F. A. Heinze, the presi
dent of the Mercantile National bank,
had nothing to do with the opera
tions of his brother's firm and that
he appeared now wholly in the role
of rescuer of his brother in the hour
of misfortune.
The news that the Heinze brok
erage associates, Gross & Kleeberg,
had failed, threw a cold chill over
Wall street, and led to the belief
that the efforts toward aiding the
Heinze firm might also fail.
Mr. Gross said that his firm's
failure had been caused by the "lay
ing down" of the Heinzes; that cop
per stock had been purchased today
for Otto C. Heinze & Co. and that
at the last minute the Heinzes had
refused to take it.
Defeated Plunger Will Attempt to
Recuperate Fortune.
New York, Oct. 21.—"Back to the
mines for me," said Frederick Au
gustus Heinze today when asked for
a statement of his future intentions.
Friends state that his plan is to go
back to his mines out west to re
habilitate himself, and wage a war
against his enemies of Wall street
who have been responsible for his
present embarrassment and resigna
tion from the presidency of the Mer
cantile National bank.
It is reported that the sale of his
present holdings of Wall street will
yield enough for him to carry on his
western enterprises and again make
him a very rich man.
One of his friends here today stat
ed that Heinze knows that he can
produce copper at six cents a pound,
and that in this manner he can drive
his enemies in the copper world out
of business.
Heinze is after revenge. He is go
ing to operate his mines personally
until he has created another fortune,
and will then re-enter the field in a
fight for extermination.
The eastern press seems to believe
that F. Augustus Heinze is "down
and out," and many of them, in their
cartoons, carrv out this impression.
The Chicago Tribune of last Friday
has a cartoon on its first page il
lustrating the conditions then pre
vailing in Wall street, pictures Mor
gan taking a quiet nap, Rogers whit
tling, Harriman prepared to go fish
ing, and Heinze, in the back ground,
his head bandaged, limping on a
crutch, and holding a tin cup in one
hand, soliciting alms from passers
by.
The Denver News of the same
date pictures Rogers doing the
soliloquy from Hamlet, heading the
picture. "Another Victim of the
'System.' " Rogers is holding in his
hand a skull marked "Heinze," and
says:
"Alas! poor Heinze!
I knew him well—he was a gracious
dub,
He helped me many times to gold
and bonds;
And when his usefulness to me was
past,
Why, I helped him—to this."
Hard Times in Kansas.
The old days of grasshoppers and
drouth are almost forgotten in the
prosperous Kansas of to-day; al
though a titizen of Codell, Earl
Shamburg, has not yet forgotten a
hard time he encountered. He says:
"I was worn out and discouraged by
coughing night and day, and could
find no relief till I tried Dr. King's
New Discovery. It took less than
one bottle to completely cure me."
The safest and most reliable cough
and cold remedy and lung and throat
by C. H. Williams. 50c and $1.00.
healer ever discovered. Guaranteed
Trial bottle free. C. H. Williams. B
CHINESE NOT WANTED
Must Pass Examination in English
to Practice Medicine.
Helena, Oct. 24.—Attorney General
Albert J. Galen has rendered an opin
ion, in response to a query from W.
C. Riddell, secretary of the state
board of medical examiners, relative
to the requiring of answers in English
by persons taking the examinations.
The opinion states that it is not an
unreasonable regulation of the board
to require answers to be made in the
English language. There is no ex
press statute to the effect that such
examinations must be conducted in
the English language, nor is there
any law to the effect that they may
be conducted in any other language.
"However, we have no privision
authorizing the board to employ an
interpreter competent to translate an
swers written in some language other
than the English, nor do we know of
any law which would require the
board to pass upon the sufficiency of
answers written in some language
which the board could not understand
or translate. It is certaihly not an
unreasonable requirement of the ap
plicant for a license to practice med
icine, in a state where the English
is the only language taught and used
in legal and public matters, to hold
that he must sufficiently understand
such language to enable him to an
swer his questions therein."
The gold output of India for
August is reported at 47,640 ounces,
the largest in nine months. For the
eight months this year the produc
tion totaled 361,118 ounces, which
compared with 387,020 ounces for the
corresponding period in 1906, shows
a decrease of 25,902 ounces or 6.6 per
cent.
BIG BANK SUSPENDS.
Unexpected Withdrawals By Cus
tomers Is the Cause Given.
New \ ork, Oct. 22.—The Knicker
bocker Trust Co., the second largest
trust company in New York city,
with deposits amounting to abqut $60,
000,000, closed its doors at 12:30 this
afternoon, following a steady run of
persons who called to withdraw their
deposits. The company officials de
clared that the suspension of pay
ment was only temporary.
The closing of the doors of the in
stitution was attended with sensa
tional scenes at its main banking
rooms, and at the Harlem branch.
Our Business
Is Banking!
and your business requires banking fa
cilities, Our mutual interest urges us to
get together. We freely offer our service
and promise courteous treatment with
prompt and painstaking attention to your
affairs. Call or write at your earliest
convenience.
The
First "National Bank
of LetfistoWn
Capital $200,000.00 - Surplus $50,000.00
UNITED STATES DEPOSITARY
SMALL
Checking accounts receive the same personal consider
ation and attention as larger ones. Our splendid facili
ties are at the command of all who need them.
BANK of FERGUS COUNTY
LEWISTOWN, MONTANA.
Capital and Surplus, - - $250,000.00
THE PIONEER BANK OF FERGUS COUNTY.
H. B. GAUGLER
Straw, Montana
EVERYTHING YOU NEED IN!
General Merchandise
- DR. LONG -
Has returned from the east, where he
has been taking a practicioner's course
in dentistry* The Doctor will^be
pleased to see all old and new patients
Depositors, who crowded the rooms
ejamoring for their money, were in
sistent that they be permitted to
withdraw even a few dollars, and
when this request was refused, many
refused to leave the building. Police
assistance was necessary to preserve
order.
At the main office, Fifth avenue and
Thirty-fourth street, after the doors
were closd, the crowd surged its way
inword. The police forced them back
to the street again and again, and
from that time a guard was kept in
front of the entrance.
COAL PLENTIFUL.
Northern Pacific Will Supply the De
mand in Every Instance.
Butte, Oct. 26.—"Butte, or no oth
er Montana city, or, in fact, any city in
the northwest, will have a coal
famine."
This is the promise of the Northern
Pacific railway, made through Ira
Richards, acting general superintend
ent, before the Montana railway com
mission in this citv today.
"Though we may place temporary
embargoes on coal shipments at
various times, we do this with a view
to expediency. When the word goes
out that a locality is in danger of a
coal famine, that community shall be
our first consideration, and coal will
go in there in preference to even
perishable freight."
The commission is investigating the
hill switching charges in Butte, which
the Northern Pacific wants to raise
very materially.
Do you know that Pinesalve Car
bolized acts like a poultice in draw
ing out inflammation and poison? It
is antiseptic. For cuts, burns, ecze
ma, cracked hands it is immediate re
lief. 25c. Sold bv Phillips' Drug
Co. p. MirniP*
GALLONS sf INK
We have it in our Supply Department in any size bottle
from one ounce to one quart. The name of the maker attests
the quality, the prices speak for themselves. Telephone if you
haven't time to call; messenger will deliver.
Sanford's Writing Fluid, onc-half
pints ......................... 35c
Pints ........................... 60c
Quarts ......................... 90c
Four ounce bottles ............ 20c
Two ounce bottles .............. 10c
Sanford's Premium Black, 2 ounce
bottles ....................... 10c
Sanford's red, 2 ounce bottles ...10c
Sterling blue black, 2 ounce ...,10c
Carter's violet, 2 ounce ........ 10c
Hanford's white, 2 ounce ....... 15c
Sanford's fountain pen .......... 15c
Sanford's rubber stamp ink .... 15c
Rubber stamp ink, 2 sizes, all
colors .............. 15c and 20c
Cook's indel ible ink ............ 25c
i'ayson's indelible ink .......... 25c
Drawing inks, assorted ........ 30c
Shading pen ink ............... 15c
Arnold's writing fluid, pints ...,60c
I
N
K
Brand Netf Stock Notf on Display
DEMOCRAT SUPPLY DEPARTMENT
PflLfl
Palacelite Oil
does not char
The Best Pec
GELITE OIL
is Free From Impurities* It
the wick, smoke nor smell*
>ple Use it and Endorse it*
Our Lubricati
Oils Are the B
There Is ...
Try Our 70 or
GASOLINE
ng
est / WHY \
f PATRONIZE THE
76 \ TRUST
FERGUS COI
Leu
UNTY HARDWARE CO
ristown, Montana