Southern Beauties

The Shenandoah and the Blue Ridge are two of the greatest beauties of the South. A third is Mona Strader Schlesinger Bush Williams. Last week Harrison Williams, multi-millionaire utility tycoon, gave up active management of his two investment trusts named for the valley and the mountains. Thus does a New Deal succeed a New Era.

New Era. Harrison Williams, Ohio-born, now turned 60, was ten years ago a great utility man, master of Central States Electric Corp. and North American Co. The degree of his mastery is evident from the fact that in 1931 he controlled of North American. Naturally he was rich. As an interesting gesture he with Vincent Astor, Marshall Field and the late Henry Devereaux Whiton financed William Beebe's expeditions to the Sargasso Sea and the Galapagos Islands--with the result that there is today a Harrison Williams Volcano in the islands. He also bought the Krupp-built Vanados, then largest yacht afloat, with a cruising radius of 12,000 mi., renamed her Warrior and refitted her for his own oceanographic and pleasure purposes. In 1926, having been a widower for eleven years, he suddenly married Mona Bush, beauteous divorced wife of James Irving Bush of Winthrop, Mitchell & Co.

It was a socially celebrated love match. They departed on a round-the-world cruise in the Warrior. They returned and bought Elbert H. Gary's mansion at 94th Street & Fifth Avenue, Manhattan. He bought her more expensive clothes and jewels (including one of the world's finest emerald necklaces) than are worn by any other woman in Manhattan. He provided her with a house at Palm Beach, built her a magnificent house on Long Island.

But there was one more thing he was to do for her. The old commercial paper house of Goldman, Sachs had grown wealthy and mighty during 30 years, floating the securities of companies that became great--Sears, Roebuck, General Cigar, Studebaker, Cluett Peabody, Woolworth, Endicott Johnson, Postum, Continental Can, May Department Stores, Pillsbury Flour, National Dairy Products, Goodrich Rubber, Lambert Pharmacal, Gimbel Brothers, Warner Brothers. Goldman Sachs had a bright partner named Waddill Catchings, Tennessee-born Harvard graduate who had been by successive and increasing turns lawyer, steelman and J. P. Morgan assistant in purchasing supplies for the Allies during the War. In December 1928 Mr. Catchings made history by launching for his firm, Goldman Sachs Trading Corp.

In the summer of 1929 Mr. Williams and Mr. Catchings joined forces and raised a shower of fireworks over Wall Street. Goldman Sachs Trading Corp. had (besides ventures in Chicago's Foreman Bank and the Detroit banking situation) acquired a stake in Pacific Coast utilities. Turning eastward Mr. Catchings cast his eye on the great North American Co.

Mr. Catchings was classed in 1929 as an Economist, and he expounded many arresting theories, among them the theory of the New Era: that profits and prices were going on & on and up & up. He was joint author of several books showing how depressions could be ended forever by just buying and buying. President Hoover read his book, The Road to Plenty.

But before that took place, Mr. Catchings and Mr. Williams joined forces, and during the summer (while, as it happened, Walter Sachs was in Europe taking what proved to be an expensive vacation) they launched a mighty investment trust. It was launched with $102,500,000 of assets of which $67,500,000 was supplied by the public who bought a million shares of preferred stock at $50 and a million shares of common at $17.50. The rest was supplied by Goldman Sachs Trading Corp. and Mr. Williams' Central States Electric Corp., each of which acquired 2,000,000 shares of common. No prosaic name had this huge trust. Mr. Williams in his wife's honor named it after her beloved Shenandoah Valley. Magnificent was Shenandoah's reception in July of 1929; in a few days the stock issued for $17,500,000 was valued at $42,000,000.

A month later Messrs Catchings & Williams were ready for a new flotation. This one was named after Mrs. Williams' beloved Blue Ridge mountains. Goldman Sachs Trading and Central States Electric put up $62,500,000 capital (through Shenandoah) to purchase 6,250,000 shares of Blue Ridge at $10 a share, and the public was offered a million shares of preferred at $51.50, a million shares of common at $20. The public was not expected necessarily to buy with cash. It was invited to trade its blue chip stocks for Blue Ridge shares. The offer was: to take shares of Allied Chemical (last week selling around $85) for $324, of American Telephone (last week $91) at $293, of Atchison (last week $42) for $275 and of General Electric (last week $15) at $395; of U. S. Steel (last week $33) at $238; of I. T. & T. (last week $6) at $119; etc., etc. But the public did not respond to Blue Ridge as it had to Shenandoah. Blue Ridge began to sell off--and then, while it was still being traded on a when-as-and-if-issued basis, came the slump.

In May 1930 when Mr. Catchings resigned from Goldman, Sachs and marched over to a desk in Mr. Williams' office, the New Era came definitely to an end.

The New Deal, 1933, found Shenandoah with its $102,500,000 of assets shrunken to $32,455,000; Blue Ridge with its $127,500,000 of assets shrunken to $40,405,000; one selling at $1.85 a share, the other at $2.25. Harrison Williams still presided over them, and if his personal fortunes had waned he showed it far less than many another multi-millionaire of 1929, though his Long Island estate was reported for sale. Shenandoah's largest assets included over $1,500,000 of North American Co. and slightly less of Central States Electric. Blue Ridge's largest assets included about $6,500,000 of North American Co. and $3,000,000 or $4,000,000 of Central States Electric.

Meantime Floyd Bostwick Odium, master of Atlas Corporation, had been going around picking up second-hand investment trusts. Atlas' holdings of Blue Ridge were listed on Dec. 31 as only 92,215 shares, of Shenandoah only 19,471, but Mr. Odium must have picked up more off the record, for last week he turned up with control.

So two beauties of the South passed from Mr. Williams to Mr. Odium, becoming incidentally the 20th and 21st investment trusts that Atlas has picked up. The list began with 1) Widlaw, Inc., February 1930; 2) All America General Corp., June 1930; 3) Allied Atlas Corp. (formerly Exide Securities Corp.), August 1930; 4) Power & Light Securities Trust, March 1931', 5) Selected Stocks, Inc., March 1931; 6) Ungerleider Financial Corp., April 1931; 7) Iroquois Share Corp., May 1931; 8) General Empire Corp., June 1931; 9) Jackson & Curtis Investment Associates. July 1931; 10) Sterling Securities Corp., July 1931; 11) Securities-Allied Corp. (formerly Chatham Phenix Allied Corp.), August 1931; 12) Southwestern Investors, August 1931; 13) Chain Store Stocks, Inc., September 1931; 14) National Securities Investment Co., September 1931; 15) Aviation Securities Corp., December 1931; 16) American, British & Continental Corp., January 1932; 17) Atlantic Securities Corp., May 1932; 18) Federated Capital Corp., August 1932; 19) was Goldman Sachs Trading Corp. of which Atlas took command two weeks ago (TIME, April 17).

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