Blair-Rockefeller

Cutten-Sinclair (See front cover)

On a wall in the offices of Blair & Co., bankers, at No. 24 Broad St., Manhattan, hangs a portrait of J. Insley Blair, founder. Revered is the memory of Mr. Blair, but stocks and bonds no longer interest him. The inheritor of his power, though not of his title, is Elisha Walker, senior partner of Blair & Co.* There is little about Partner Walker to distinguish him, outwardly, from other Blair & Co. partners such as Polo Player J. Cheever Cowdin. He has dark hair. He is of medium size. He is decidedly middle aged. He likes to play poker. He is impatient of obstructionism. It is on Mr. Walker, however, that the destinies of Blair & Co. most vitally depend. In an association, theoretically, of equals, Mr. Walker stands unquestionably a superior. He it is who decides where the potential energy of Blair & Co. millions shall be cynamically applied.

And recently his decisions have concerned the oil industry--an industry which, suffering from overproduction and savage competition now shows signs of straightening out its difficulties. Carefully surveying the oil industry, Mr. Walker discreetly arrived at a conclusion. The result of that conclusion was last week's transfer of some thirty million dollars of Rockefeller holdings in the Prairie

Oil & Gas and the Prairie Pipe Line Co.* to Blair & Co. Inc. These holdings totalled some 10% of Prairie Oil and some 14% of Prairie Pipe Line.

By that speculative law through which the act of purchase increases the value of the thing purchased, Blair & Co.'s acquisition of Prairie stock shot Prairie quotations upward. Indeed, the deal had hardly been concluded when the rise in Prairie prices made the $30,000,000 holding worth $47,000,000. Even before the purchase, however, the two Prairie flowers had been blossoming with unprecedented brilliance. Prairie Pipe Line had a Low for the year of 51. Last week's High was 277. Even Wright Aero, even Radio Corp. have not equalled this record climbing--the most sensational advance in a year of sensational advances. And Prairie Oil & Gas has moved from a Low of 26 to a High of 67.

Yet the bull market in oils is not caused only by Partner Walker, not only the work of Blair & Co. Other and even more powerful interests have influenced the rise in oils. Chief among these other influences is Arthur W. Cutten who has gone into Sinclair Consolidated as Blair & Co. have gone into Prairie oil. Always a bull, never a bear, Arthur W. Cutten has done more than any other individual to make the overload stock ticker lag far behind the market and Prairie Pipe. He has been in Radio Corp., in Montgomery Ward, in many another of the soaring stocks that have done most to create the present buying market. In a bull market, among many bulls, Bull Cutten ranks king of the herd.

But since No. 209 Lake Shore Drive, Chicago, is still Arthur W. Cutten's home, it has been necessary for him to have a Wall St. representative actually on the trading floor. Such a representative he has found in his nephew, Ruloff Cutten./- If Uncle Cutten is the brain of the combination, Nephew Cutten is certainly its vigorous tongue, its potent legs. There is no more active bustler on the floor of the exchange than Nephew Cutten.

It was in October that the Cuttens began operations in Sinclair Consolidated. They bid for it by the ten thousand, by the twenty thousand, by the forty thousand-share blocks. Once indeed Nephew Cutten bid for 100,000 shares of Sinclair at 42--a transaction involving $4,200,000. Finally, on Oct. 26, it was announced that Arthur W. Cutten was to become a director of Sinclair Consolidated--one of the very few directorates on which Mr. Cutten has ever consented to serve. According to the general estimate, he has purchased 1,300,000 shares of Sinclair. He controls probably 20% of the entire Sinclair issue.

With Blair & Co. in Prairie, with Cutten in Sinclair, drawers of inferences soon began to predict a Prairie-Sinclair merger. Point One: Elisha Walker is a Sinclair director--a potent and obvious point. Point Two: Prairie Oil & Gas, with assets of $186,323,925, is the largest U. S. producer of crude oil. Harry F. Sinclair needs constantly more oil for the Sinclair Refining Co. Obviously happy would be an arrangement whereby Sinclair refineries could call upon Prairie Oil, whereby Prairie Oil would have an affiliated customer in Sinclair Refining. Why should not Sinclair Directors Walker and Cutten confer together, arrange a merger of Sinclair, Prairie, and, the government permitting, various smaller companies? So the rumors ran; so the oil stock boomed. Yet no authoritative announcement, no merger was forecast for the near future.

In 1886 a hardware store on Lake Street, Chicago, had for a messenger boy 15-year-old Arthur Cutten. Soon Arthur Cutten, still a messenger boy, was working for a commission house. From messenger boy he became a clerk for A. S. White, onetime president of the Chicago Board of Trade. Later he was one of A. S. White's pit traders. Then he entered the grain market for himself, and during the World War is said to have made more money than any other individual operator. He once accumulated four million bushels of corn, bought at 80-c- a bushel or less; held them until they sold at from $1.11 to $1.14 1/2; realized a profit of a million dollars. It was in railroad stocks, however, that he made his first market profits. Back in 1904 he bought some 1,500 shares of Soo Line stock at from 54 to 60, sold at 160, made what he would now consider the trifling profit of $150,000. Since beginning his eastern operations, U. S. Steel, International Harvester,.Radio Corp., Sears Roebuck and Montgomery Ward have been among his favorite stocks. He is believed to have bought 100,000 shares of Montgomery Ward when it was selling at 75. Last week the Montgomery Ward quotation reached 438 1/2, which would give Mr. Cutten a paper profit of about $36,000,000.

Such leisure as he possesses he spends in California, Florida or on his 800-acre farm near Chicago. On this farm he raises, appropriately, bulls.

Whether Mr. Cutten bought Sinclair stock with a Sinclair-Prairie consolidation in mind, or whether his purchase represents only a characteristic bullish point of view on oils, is a question upon which one man's opinion is as good as any other man's--except Mr. Cutten's. The situation is somewhat complicated by the fact that Mr. Cutten has arrived at the position in which any stock that he buys is automatically skyrocketed by his buying it.

Realizing this circumstance, desiring to keep himself free from small-fry operations, Mr. Cutten has recently adopted a rule concerning his participation in any stock operation. He has set a minimum limit on any Cutten purchases which represents the smallest block of stock with which he cares to concern himself. And that block is said to be 100,000 shares.

* Blair & Co. is a partnership. There is also Blair & Co., Inc., a corporation. Banker Walker, chief of the partnership, is also president of the corporation. * The properties of the two Prairie companies were originally owned or controlled by the Standard Oil Co. of New Jersey. Since the dissolution of Standard Oil, the properties have been independently operated by Prairie Oil and (as to the pipe properties since 191 by Prairie Pipe.

/- Ruloff Cutten is associated with E. F. Hutton &: Co., Manhattan brokers. The Hutton business has greatly increased since the Cutten connection.