The Knickerbocker
Trust Company had already failed, and runs had begun on, or were
threatened as regards, two other big trust companies. These companies
were now on the fighting line, and it was to the interest of everybody
to strengthen them, in order that the situation might be saved. It was
a matter of general knowledge and belief that they, or the individuals
prominent in them, held the securities of the Tennessee Coal and Iron
Company, which securities had no market value, and were useless as a
source of strength in the emergency. The Steel Corporation securities,
on the contrary, were immediately marketable, their great value being
known and admitted all over the world--as the event showed. The proposal
of Messrs. Frick and Gary was that the Steel Corporation should at once
acquire the Tennessee Coal and Iron Company, and thereby substitute,
among the assets of the threatened institutions (which, by the way,
they did not name to me), securities of great and immediate value for
securities which at the moment were of no value. It was necessary for
me to decide on the instant, before the Stock Exchange opened, for the
situation in New York was such that any hour might be vital, and failure
to act for even an hour might make all subsequent effort to act utterly
useless.
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