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2) New lists of Morgan "friends" who were cut into stock deals below the market included the names of New Jersey's Senator Kean, Massachusetts' Lieutenant Governor Gaspar Bacon, Edgar Rickard, business associate of Herbert Hoover, Arkansas' Harvey Couch, now on R. F. C., Connecticut's G. O. P. Boss John Henry Roraback. The only "friend" revealed as having turned down a Morgan offer on ethical grounds was Board Chairman Edward Grant Buckland of New York, New Haven & Hartford R. R. Partner Whitney made a spirited defense of his firm's practice on the ground that its beneficiaries were willing and financially able to risk possible losses, did not have to borrow to buy, were not likely to dump their holdings for a quick profit and thus unsettle the market.
3) United Corp., the huge Morgan-Bonbright utility holding company, gave the House of Morgan large influence in the power field but by no means control. Partner Whitney: "It has not always been J. P. Morgan & Co.'s policies that have been adopted by a long shot. I don't mean that there was a knock-down and drag-out fight but we often defer to the operating heads in matters of policy."
4) The partnership papers of the House of Morgan, so arcane that even Lawyer Davis had never seen them, disclosed that Partner Morgan was the firm's supreme arbiter, that one partner could veto any proposal, that half of each partner's profits were plowed back into the company, that the name of Morgan must vanish 15 years after the last Morgan leaves the firm. Though the committee withheld the partners' shares in profits, it was generally understood that Partner Morgan got 25 %.
5) Chairman Fletcher would be unable to open a $100,000 deposit account with Morgan & Co. unless properly introduced.
6) On Oct. 24, 1929 the House of Morgan headed a bankers' pool (Partner Whitney, who said he was "gun shy" of the word "pool." preferred to call it a "suspense account") to cushion the crashing stockmarket. It had resources of $250,000,000 of which it spent $137,752,705 in making a market for 37 key stocks. By 1930 the pool had turned a paper loss of $40,000,000 into a cash profit of $1,067,355. Morgan & Co. charged no commission for its services.
7) When Counsel Pecora called Junior Partner Thomas Stillwell Lament to the stand and began to quiz him on personal year-end stock sales, presumably for tax deduction purposes, Lawyer Davis came to his feet in protest, forced the question of personal stock transactions into executive session.
8) Senator Glass and Counsel Pecora shook hands for photographers as they made up their quarrel as to committee procedure. Senator Glass won his point of demanding advance information on what Inquisitor Pecora was trying to extract from witnesses, and why.
9) The Brothers Van Sweringen, clients of the House of Morgan, began building up their railroad empire in 1916 on a loan, borrowing from a Cleveland bank $2,000,000 to make a cash payment to the New York Central for the Nickel Plate. According to Inquisitor Pecora, they got control "without putting up a 5¢ piece."
Issues. Throughout the land last week Banker Morgan and his partners were being judged less on the facts than on the headlines distilled by Inquisitor Pecora. What were the real issues?