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THK HKK: OMAHA, FRIDAY, DFiCKMHlOR 20. 1912,
5 DENVER GATEWAY SEALED ! Union Pacific Ties Up the Outlet to Colorado Roads. HILL MEN SAY OPPRESSION Ilnrrlmnu Men Sn It U Onl? n Hnslne Proposition for the snr.Protrctlon of Ihr Union Pacific. According to tho other Omaha-Denver railroads the Union Pacific has not only Wwed the Ogden gateway, but has nailed barbed wire over and across It. The Union Pacific people admit that tho gateway has been .barred and nailed and that the koy has been thrown away. The trouble is nil brought about by reason uf the fact that tho IIIll Interests bought the Colorado' Sc. Southern nroperty tliat the Harrfman people wanted and wanted badly. As soon as the Hills got hold of the Colorado & Southern they Issued the ultimatum that In the near future they would have An oeean-to-gulf line and commenced bulldlnp. the ,gap through Wyoming, discontinuing only when the break occurred between the Xorthwogtcrn and Burlington, wherfclJy tho latter ex beclcd to luc the track of the former aetween Towder River nnd Orln Junction, Shortly nfter the Hills got hold of the Coloiado & Southern tho Union Pacific clo.od the Denver gateway reasonably tight, but nothing like what It Is at this time. In a general way the closing Is against all competing roads Into Colorado, but It hits the Burlington tho hardest. Under the new order or things. If freight ftom Omaha goes to points In Colorado over the Burlington to Denver and from there It Is routed over the Union Pacific to destination, It does not Kb unless the full local is paid. There is no such a thing as a through rate. The result Is that the through rate over the llurllngton to Uemcr and the local fium tliero to destination makes the aggregate i ate practically prohibitory. llurltiigton people look upon the move as oppression, but on the other hand, I'nlon Pacific officials say It Is simply biiilness for !elf protection MORGAN SAYS THERE CAN BE NO MONOPOLY IN MONEY AND CREDIT. (Continued from Pago One.) house often had much to do with tho tablllty and success of corporations. There's another point about It," ho added, "You must remember that all se em Ittes sold and Issued are not always good and Avhen there Is a responsible fiscal agent there Is moral strength be hind them." "Will yo name any Instance of n rail road bond proving bad, wheie your firm has had to pay the loss?" asked Mr. Un tcrmcyer. "I can't remember any case, but I know there have been several," said Mr. Mor gan. "AH that comes out of the security holder?" "Xo out of the property." "But that eventually comes out of of the security holdor," suggested the at torney. "Look over the whole history uf .tho railroad business and see If you can find one caso where the banker has nad o stand the loss." Mr, Morgan said he could recall no spcclflo case. Appoint Steel nonrd. Mr. Untermycr turned to the fiscal ar rangement with tho United States Steel corporation. "Didn't you name tho entire board of directors of tho United States Steel cor poration?'.' ui-ked Mr. Untermycr. , "I think 1 passed on it." "Hut didn't you hand out a, slip con taining the names?" "If passing on tho board is naming, 1 did uulto willing to assume all tho re-, sponslblllty," said Mr. Morgan. "But dld'nt you say who should go on nnd who should stay off?" persisted tlTc lawyer. "I possibly did the latter,'" replied tho financier, amid .a laugh. Mr. Morgan said he had not 'passed on all who went on the board of the 'Steel corporation, but said no members had ever gone on the joard against his pro test. "Who fixed tho prices at which the various subsidiary . companies should go Into the organization?" asked Mr. Un termycr. "I approved the price," said Mr. Mor gan. "But It was left to you to determine the jirlca at which they should come. In?" "Yes, but I wasn't always able to get them at tho price we wanted." Which committee of tho Steel corpora tion selects the banks where Its fund' shall be deposited?" "The finance committee." Mr. I'ntermyer asked If men had not monopolized railroads and Industries and ubuscd their power. "I am not discussing the question of railroads or merchandise; I'm talking about money and credit," said Mr. Mor gan. He suld a man might get control of tho former! but could not get the latter. Mr. Untcrmyer asked whether Mr. Mor gan thought competition among bunks or concentration would be better. "I'd rather have competition," replied Mr. Morgan when pressed for an answer. Competition Auiuiib Pnrtnrrs. He said he thought several men could bo directors In different banks and com petition still be maintained between the banks. Ho added that ho did not believe jne man should run a great enterprise. Don't you run your firm?" "No, I do not." He said he did not favor one man con trol of great enterprises of any kind, even railroads. You believe In concentrated power?" asked Mr. Untermyer. "Well, that Is a question of personal power, of personality." replied Mr. Mor gun. Mr. Untermyer asked about the possi bilities of competition between the Guar anty Trust company, the Bankers' Trust company and the Bank of Commerce. Mr. Morgan said that he knew nothing of the details of the management of thoso concerns. He said that the Bankers' and Guaranty companies had taken. In seven other companies and really represented nine old truit companies. "Thst Is an example of combination and concentration." said Mr. Untermyer. "How far do you think they ought to W allowed to go?" "I thluk they have got enough," said Mr. Morgan. "You don't think they ought to alorb wiy more?" 'No. They may be forced to take In tome more companies.' ' Forced, for the good of the companies absorbed?" asked Mr. Untermyer. "Yes. forecd to absorb them to protect them." At this point the committee ordered a brief recess. Ctiiimlntti c titliiB All Htulit. After a short recess Mr. Morgan re sumed the stand, while Mr. Untermycr read Into the record laws covering the voting powers of stockholders In foreign banks. Mr. Untermyer referred to cumu lative voting. "You know that there Is cumulative voting In the Pennsylvania railroad. Under that plan one-seventh of tho stock holders can get together and elect a di rector. Two-sevenths can elect two di rectors. Thus they can secure a minority representation. Now most directorates are controlled by bare majorities," he Said. "Yes." agreed Mr. Morgan. "Don't ou think that the minority should be represented In a directorate?" "I tjilng that's n very good plan." He added he would favor cumulative voting If It would secure that result. ' . Mr. Morgan observed that' the figures showing slock voting methods in foreign banks as Introduced by Mr. Untermyer scmed to Indlcnte control by "what re srmbled "voting trusts." "They could simply put their stock un der different names and evade that law. ( 1 don't want to suggest that, but It could i 1. . 1. ! .t I nunc. Iiu null,, "But they don't allow that-" sort Jf hocus poens over there," remarked Sir. Untermyer. "I think tho lecords will show differ ently." he returned. "There Is no placo where mergers nnd consolidations have taken, place to the extent they have In Gieat Britain." Mr. Morgan added. No Ciiinliliint Ion of Hunker. Mr. Untermyer declared under the Eng lish system there wole many groups of bankers entirely Independent) of each other and pet sons desiring to finance a proposition could go to any one of them. Mr. Morgan said he did not believe there was any great combination among bankers In the United States. "Do you know of any railroad financed Independently In recent years?" asked Mr. Untermeycr. Mr. Morgan said he did not know of any, but did not think, however, that either the domination of railroads by bankers, or the unity of Interest of bank ers had anything to do with It. "Don't you and other bankers' control the Beading road?" asked Mr. Unter- meyer. "No, sir: If we do I don't know It," said Mr. Morgan. "You don't think you have any power In any line of Industry In this country?" "No, I do not." "Your power In any direction Is en tirely unconscious of you?" . "Yes. sir." IlllldAvlu Locomotive Deal. "Well. Let's see about this concentra tion situation," said Mr. Untermeyer. "You took over the Baldwin Locomotive works?" "Yes," we handle their securities." "Prior to that time the American Lo comotive company had been formed?" "Yes." "Now, assuming that you and ,Mr. nnkpp rmnirnl the ereat railroad systems of this country and between you, jou are Interested In the American Lcomo flv ivimnniiv. what chance do you think a new locomotive company would have to succeed?" "I think .If would have a. good chance. We could -not buy all our locomotives from one company," "Do' you think It Is a healthy condition for tho interests In the supply companies to be Identical with the Interests of the railroads that buy supplies?" Mr, Morgan said he did. Mr. Untermeycr asked Mr. Morgan If he knew anything about the organization of the Now York. Wyoming & West ern railroad to open up new Independent coal roads. Tills railroad figured in the recent "hard coal" cases before the su preme court, wheio It was held that tho Temple Coal and Iron company had strangled tho now road. 1r. llntermever asked if Mr. Morgan knew Hobert Bacon, a former member of his firm, had gone Into the coal rieio and bought up tho collerles, so that tho new road was not built. Mr. Morgan said ho knew nothing about It. The consolidation of the Lake Shore r,.i Mint,lf?nn c'entral railroads Into the New York Central lines was brought up by Mr. Untermeyer. "You believed In buying up the com pctlng liner' "Wbv. sure." Mr Tlntermver asked about the con solidation of tho Northern Pacific and Great Northern In tho Northern Securi ties merger. "What was your Idea as to the reason for destroying competition there?" asked tho lawyer. "i don't know." said Mr. Morgan. Mr. Untermyer then began a series of questions about the elimination or com-IK-tltlon In the organizations of tho United Stntes Steel corporation, but In terrupted himself. I will not en Into that." he said. "That Is now in litigation and I will not question you aDout h. Kiliittntilp Life Pnrrhae. Mr. Morgan testified that he bought control of the "Equitable Ltfe Asauranc society ftom Mr. Ryan and Mr. Harrl man." He secured, he said, about J51.0G0 worth of stock, for which he paid 13,000,000. "The company pays 7 per cent divi dends?" i "Yes." "About one-eighth or one-ninth of one per cent on the Investment?" "Yes." Mr. Untermyer wanted to know If James Stlllman and George F. Baker were Interested in the purchase of the Equitable. Mr. Morgan conferred with his counsel about answering -that ques tion and finally said Mr. Baker and Mr. Stlllman had agreed to take one-half of the Investment off his hands If at any time he wanted them. I ,(. I it til iiididvcu Mil niiunmb why Mr. Morgan had thought It good J business to buy the Equitable stock at a j price that paid only one-ninth of one per cent Interest. Mr. Morgan said he thought It was j "good for the situation." ' Mr. Untermyer nsked why It was not just as "good for the situation" In the hands of Mr. Ityan and Mr. Harrlman. "I don't know," said Mr, Morgan. "But you thought It was better for you to have It'."' "That's the way it' struck me." said Mr. Morgan. He added; "That Is all I ' hava to say about It." I "The assets of the Equitable company (are something over loOO.oOO.OOOT" "I think about that " I Mr, Morgan said he asked Mr. Ityan to sell his Equitable stock to him. urn he tay he wanted to sell it?" "No, but he sold it" Mr. Morgan said that he had but iw Idea about the disposition of the Kuuit-1 able company. "I think It should be turned over, that Is the stock, to the policyholders." he said. "That has always been my Idea " "You mean sell It to the- policyholders for 3.0D0,C00T" "For just tho price 1 paid for It." "Then I don't understand why you bought the stock." "Only because I thought It was tho thing to do." "Then there wns no reason?" asked Mr. Untermyer. "Well, that's the way you look at It," answered Mr. Morgan. "1 thought It as the thing to do. Some day you'll agree with me " 1 "Maybe some day you'll agreu with me." returned Mr. Untermyer. "Well, if 1 do. It will be for a good reason," said Mr. Morgan with a laugh, Mr. Morgan explained In more detail that he had thought there wns a possi bility of the Equitable stock being divided that Mr. Ryan had already sold some of his. "That was nol the reason, ' he said, "that's only ono of tho things that went through my mind." "Thr Thine to Iln." "But what would have been the harm If It had been divided?" Mr. Morgan Insisted that the onlv answer he could make ns to his purchase of the stock wns that he "thought It was the thing to do." "1 am ready to stand before the com munity on that," he declared. Data bearing on the proposed mutual- Izatlon of the Equitable company was presented by Mi. Morgan's attorneys and put Into the record. Mr. Untermyer then offered a patoment of securities held by the Equitable, Mutual, Now York nnd Metropolitan Ltfo companies. Issued through Morgan & Co. and now held by the Insurance companies as part of their assets. As to the reason for the formation of the First Securities, company, an adjunct of the First National bank and tho Na tional City company of tho Natlonnl City bank, Mr. Morgan said bethought they wore organised to deal In securities tho banks, themselves could not handle. In the National City company, ho said lie hud a small holding, which ho later said was worth at present value about $6,000,009. "Do you call that a small Interest?" "It's not a controlling Interest," sold Mr. Morgan, "It" Is hot an Investment that requires constant watching." Mr. Morgan and the lawyer then went Into a long discussion nhout clearing houses and tho posslblo benefits of gov ernment supervision. Mr. Morgan Inclined to the belief that the banks In a clearing house were en titled to judge 1h admissibility of others seeking membership. Concentration of Money. Mr. Uritermyer again took up "concen tration of money." "The control of credits involves tho control of money, doesn't It?" he asked. "No, I think not. What I call mono' Is the basis of all banking gold," replied Mr. Morgan. He sold credit was tho "evidence of banking," but not tho basis of It. Credit was a great part of banking overywliere. "A man or group of men who havo the control of credit havo tho control, of monoymoncy. Isn't that so?" asked 'the lawyer. "Not always." "If you had control of all that repre sents tho assets of all the banks In New York you'd have control of the money, wouldn't you?" "No, I don't think so." Mr. Morgan said that every commodity except money could be controlled, but that money absolutely .could not be con trolled. On that point the witness wns emphatic. Mr. Untermyer asked If a control of credit would not carry with It a control of money. Mr. Morgan said no. "But suppose a man had control of all the credit?" "If ho had the credit and I bod tho money, his customers would be badly off," said Mr. Morgan, adding that credit had no relation to tho control of money. Ho said that he knew many men with great credit who had no money. Credit Without Money. "1 know men who will come Into my office and I'll give them checks for $l,0u0,000 when they have nothing back of them." Mr. Morgan said that ho lent monoy on the basis of a borrower's character. "Is that tho way you lend money on tho Stock exchange?" asked Mr. UhteT' myer. "Yes." "Do you know to whom you lend money when you send It to the loan stand on the Stock exchange?" "I know very soon afterwards. If a loan comes in for "Mr. Bmltn,' and I don't trust liim, I say, 'I'll call off tha loan' even it It wan made on government bonds." Mr. Morgan asked permission to move up nearer the commltteo table. Ho took ono of the commltteo chairs next to Representative Hayes of California, As he took his seat, bo remarked: "I'm getting a little deaf as I got older." Continuing his testimony he said he knew very' little of operations on tho New York Stock exchange. "Don't you think tho quotations on tho exchange should represent real transac tions?" nsked Mr. Untermyer. "I think they do. But I know nothing uh to the facts." "Do you think manipulation Is genuine." "No." "That's Illegitimate?" suggested the lawyer. "Yea, I think so." He added that ho thought a majority of the governors of the stock exchange con sidered manipulation a dangerous thing. Short Sclllnir la Necessary. Mr. Morgan said ho knew the sales of the New York Stock exchange were thirty or forty times the amount of the out standing securities dealt In. He said It nould be difficult to prevent this. If he bought stock, he said, he would probably sell it again If it got high enough. "Do you approve of abort selling?" "I don't like 1U I never did any that I know of. But I think you can't get along without It." "Why can't you get along without It? That's like a man selling something he has not got." "That teems to be a principle of life," said Mr. Morgan with a chuckle. Mr. Untermycr asked If there would not bo less speculation If the money from the country banks did not go to New York. "Then they'd get the gold from Europe," said Mr. Morgan with a wave of his hand. 'Then you think you can't stop the 'speculation that way?" "No, I think not." He added that he thought that a high rate of Interest would not prohibit it, nor a usury law. "Suppose you wanted to find out tho I commitments of a Wall slxixl.JJitI&tti. COME EARLY FRIDAY Into how ninny banks uml trust companies could you dclvn through your own part ners?" "None." Mr. JloiKJin sulil that directors could not (fo Into the affairs of a bank that way. aceonllnir to IiIh unilerstnniHnir of tho duties of a director. Ho wis certain of his position. "Well, then 1 rucks that will bo till. Mr. MorBan," uald Mr. Untermyer, and tho financier left tho stand. Ho hook hands with Mr. Untermyer and tho mem bers of tho committee, held a whispered conference with hli attorneys nnd left the building. The committee adjourned" until Janu ary 6. Farnam 1300 Block Keeps Open House All Day Today Tho Farnam street 13W block will play Santa Clans to the peoplo of umana today. All merchants have linked themselves together for the day when they will keep open houso nnd play hosts to nit who will visit that part of the retail dis trict. Hundreds of dollars' worth of mer chandise will be given away and In addi tion to this many lines of goods will bo sold far below cost, Just as an Induce ment to linve tho Omaha public accept their hospitality. While this 1300 block was once tho real retail cqnter of Omaha the center chanced for a time, but with tho con struction of the AVoodman of tho World building tho 1S0O block has "como bnck" and Its llvo merchants are ncnin bidding for their share of the business of a sreat and rwl"g- city. Four Libel Suits Filed Against Two Omaha Daily Papers Libel damage suits against tho World Herald and tho Daily Nows for JSO.noo each, wcro started by Ira Planniigan and Kd Gardlpee, county prisoner feeding contractors, In district court yesterday. The suits are based on news storjes published In the papers to the effect that prisoners in the county Jail mutinied be caused the food served them won unfit to eat. The articles upon whloh the suits are based, also refer to former complaints of prisoners regarding Uie quatlty of the food, Flannogan and Oardlpee declare the Btorles false. Deputies In the Jail also as sert the food gave no cause for com plaint. Flannagan and Gardlpee each sued the World-Herald and the News for $10,000, four suits altogether. Public Hearings on the Workmen's Bill The workmen's compensation and em ployers' liability commission, before sub mitting Its draft of a law to the governor, will hold public, hearings In the council chamber of the city hall, IJncoln, Mon day and Tuesday, December 2J and 24, and In the council chamber of the city hall, Omaha, Thursday, Krlday and Saturday, December 26, 77 and SS. Morning sessions from 10 to 12 o'clock; afternoon, 1:30 to 5 o'clock; evening, 7:10 to 10 o'clock The full commission will sit the entire five days to hear all persons Interested In the subject, whether for or against the provisions of the proposed law. The bill Is now being printed and copies will be furnished on application to tho commissioner. Tho draft of tho bill In cludes the majority and minority report of the commission. After these hearings the bill will be revised, if the arguments presented Jus. tlfy any changes and will then bo rn ported to the governor 8TEHDJNO TOILET 8KTS FltENJSER, MAN ROBBED IN DAYLIGHT ON FARNAM STREET Mart Butler of Geneva was relieved of I'M In cash and his Masonic pin at 9 o'clock yesterday morning while walking down Farnam street en route to the Bur lington depot. A youth walked beside Butler and struck up a conversation, and after they parted company Sutler discov ered his loss. Mrs. I. Kemp, who has a rooming hous at 610 North Thlrty-slxth street, re ported to the police that a thief had en tered the room of R. 13. Stewart, who boards with her, and taken a valuable diamond ring and $30 In cash. STERLING NnV.ELTIKayjinNZKR. Minim ii-aCTagm Wonderful Sale Silk Petticoats A USEFUL HOLIDAY GIFT 100 Doz. New Silk Petticoats Secured at a Great Sacrifice to Manufacturer Choicest Petticoats of tho aoasen correct styles mnd up in good grade taffeta, mossaline and brocade satins soma Jarsey tops, "Klosfit make" novelty flounces, with silk and cotton dust ruffles. Evening shades and street colors. Divided into two groat lots for Friday's sale. All $3.50 & $4 SILK PETTICOATS on sale FRIDAY . . . . THOUSANDS OF BEAUTIFUL WAISTS For Christmas Gifts Selections were never better. Every wanted stylo, every desired shade. Choose from thousands at from $1.50 to $25 S J V S I UNION LABOR CLAUSE IS YOID Large Number of South Omaha rav ing Contracts Blocked. CITY MUST ADVERTISE AGAIN Strrrt lmprormrnli In Mnuli' City llnve II rc Held Up I'nidlna n tlPi-Ulon In the Cnxe Mn ,ippnl. Perpetual Injunction restraining the city of South Omaha from executing paving contracts aggregating $300,000 was Issued by Judgo Howard Kennedy In tho equity division of tho district court yesterday. Judgo Kontiedy held void tho union la bor clause, rhlch was observed In the letting of" tho contracts. Unloss tho decision Is nppoaled to tho supreme court the 8011'th Omaha city council will have to roadvertlso for bids for tho paving contracts affected and nwnrd new con tracts. John 1'. Urecn, attorney for In terested contractors, said an appeal prob ably will be taken. Contracts affected are thoso of tho Na tlonnl Construction , company, Ororgo Parks &. Co., Oan Hnnnon and Cougilon & Co. Tho I'arks-Iefler Construction company holds snmo small uontrnctH voided by tho decision, hut their Inter ests aro email compared with those of other contractors. Alonr.o A. Wright, a taxpayer, Is tho nominal plaintiff In the paving cases, His attorney Is W. It. Patrick. Wright con sistently has denied that any Interests have stood behind him In IiIh prosecution of tho suit. Ho has Mr. Patrick. Streot Improvements In .South Omaha have been suspended ever since the Hiilt to void tho contracts nwardod with ob- Beat the yolks of six eggs and a half-pound of sugar together until it is a froth. Pour in half a pint of Good Old Guckenhcimer Pure Rye Whiskey; add the whites of the eggs beaten to a stiff froth ;"fhen add three pints of whipped cream. The charm of this Egg-nog comes from the distinctive flavor of rich, ripe, delightful . - OTJ1LED ihLBLOJSip $1.95 All $4.50 & $5 SILK PETTICOATS on sale FRIDAY . . . Our Greater Corset Section Offers for your choosing 12 Lines of The World's Most Renowned Corsets A stylo to fit evory figure; a price to fit every purse. SECOND FLOOR scrvnnco of tho union labor clause wan begun about a ycur ago. Work on ono Job had been begun by George Parks & Co. Tho court will protect this concern from liny lois mi work already done when Whlght'B suit was started, Bulk Sales Law is Upheld by Supreme Court of Nebraska U. a. McClllton of Omaha received word this morning that tho constitutionality of the "bulk sales law" hud been upheld by the atatn supremo ooilrt at Lincoln. At torney McGllton argued tho matter bo forn tho court representing tho Omaha Credit Mon's association. Tho bulk nalcs law was passed In Ne braska In HOT when but u few states had bucIi n law. it provided that a portion engaged in a mercautllo business might not bo pot milled to sell out the utock of goods In n lump without first notifying all his creditors of this Intention. It wns designed to protect creditors ngalnst bulk sales consummated between dnrk anil daylight, ilh hud nomotlmes been con summated, with tho icduU that tho mer chant wow not to be found by hl.i cred itors tho next day. The test onso arose out of the Appel Mercantile company ngalnst linker In the district court of Lancaster county. An appeal was taken to tho supremo court and the constitutionality ot the law wan attacked, Omaha Jobbers have watched tho caso with consldcrabln Intorest, as they wero nil hiixIoilh to see the court uphold tho law. WJIen It wns passed In Nebraska In 1D07 only twenty (dates of the union had such n law. Since that time, only five years ngo, It Is said practically tbod aid FOR FRIDAY ONLY every state In tho union has pns?ed n, similar Juw, City Commission Amends Proposed Billposting Law No bills or paci', except newspapers and addressed envelopes will bo thrown Into front of hark yard or on tho porcn or put In the mall boxes In residential districts. Tho city rotnnilHulou pnssed this nmriidement to tho ordinance pro hibiting uiiHlghtly placards In publla places. . City Attorney Hlne drew the amend ment. It was suggested by George Kloff- nor, superintendent of mall carriers hero nnd Is modeled on a similar or dinance which has been declared logal by snverol courts. H. Bencher Howell, water commis sioner, notified tho commission that the Water board did not feel Inclined to pay certain Inspection charges which tho old council did for the old witter company freo of charge. The council referred tho communication to tho department of pub lic Improvement. K. W. Kltt was allowed" tM for services ns boiler luspcatnr during the absences of Inspector Wolfo. Jlrk Wolfe wns re quested to also iay Fltt $00. Tho name of Unucioft streot from Thirty-eighth to Fortieth was changed to Gold street. PERSONAL PARAGRAPHS , J, 11, Haynes cutortnlned his four brothers at luncheon at the University club Thurwlny, Sheriff. K. H. Andrews of Buffalo county Is In the city, arriving yestordw morning for a brief visit. )TTLED!N 1 1. ii Take a bottle horns today for your Xmt Egg-no.