Year-End Shifts

Wall Street wags last week insisted that the only reason the House of Morgan took in no new partners on Jan. 1 was that the firm could find no one who would join. The Senate Banking & Currency investigation, they said, had stripped all glamour from a Morgan partnership. But admittance of a new Morgan partner is by no means an annual event. Last one to sign the articles of copartnership was Charles Denston Dickey two years ago.

Aside from the split-up of Roosevelt & Son, the turn of the year brought few important shifts in Wall Street's personnel. Ralph Wolf and Leon H. Kronthal retired from the old house of Speyer & Co. and three new partners were admitted--Henry Herrman and Charles G. Stachelberg, both long associated with the firm, and George Nelson Lindsay, onetime vice president of Bancamerica-Blair Corp. And John Daniel Hertz was taken into the banking house of Lehman Brothers.*

John Hertz started to retire after he sold his Yellow Cab Manufacturing Co. in 1925 to General Motors. He gave more time to his race horses, turned down a $1,000,000 offer for Reigh Count, his Kentucky Derby winner, remarking: "I think any fellow who would pay a million for a horse ought to have his head examined, and the fellow who turned it down must be absolutely unbalanced." But his thick, sinewy figure continued to be a familiar sight wherever Chicago deals were done. In 1931 Kuhn, Loeb & Co. called him in to help with their ailing Paramount Publix Corp. As chairman of the finance committee, he ruthlessly lopped $39,000,000 (including $6,000,000 of salaries) from Paramount's budget. Last year when he resigned that job John Hertz swore he was going back for good to his big estate in Gary, Ill., about 40 mi. northwest of Chicago. Now his entry into Lehman Brothers marks the death of John Hertz, Chicago taxi tycoon, the birth of John Hertz, Manhattan banker.

For the first four decades of his life John Hertz never thought of retiring. Austrian-born Jew, he was brought to the U. S. as a child, ran away from home after a spanking. He became a copy-boy in a newspaper office (Chicago Daily News), learned to spell well enough to do police reporting and finally rose to be assistant sports editor. When his newspaper was merged, he started to sell automobiles. He sold them so fast that the trade-ins piled up into a nightmare. Then he hit on the idea of painting his used cars and sending them out as taxicabs. After somebody told him that orange-yellow was retained in the human mind longer than any other color, Yellow Cabs were born. And before John Hertz was through there were Yellow Cabs in almost every city in the land.

At 54 John Daniel Hertz is keen, amiable, modest but, in a business tussle, a ferocious fighter. It bothers him not a whit that on a polo field in his heavy tortoise-shell spectacles, with his helmet snugly strapped under his big chin, and seated in a curious grey, woolly saddle, he cuts a strange figure. When he misses a shot, which is often, he always shouts: "Oh Boy!"

*New York's Governor Herbert Henry Lehman was a partner in this family firm before he went into politics.

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