The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1849-12-31

Several railroad companies In New England have /
this year passed their usual dividend because they
have not earned and there appears to be among the
determination to thoroughly investigate
the affairs Of the different companies and place before
the public full fair and correct reports Of their
xtion and operations Stockholders In railroad
panes have perfect horror Of construction accounts
and the act Of the investigating committees should
be to stop leaksges in that direction. Construction
accounts enormous reservoirs. and swallow up
items Of expenditure that legtimately belong to
operating accounts. IT is therefore impossible to
obtain a true and faithful report Of the annual
running expenses Of any railroad until the construc
ton account is Theoretically sealed up. Some Of the
New England companies, of the Importance Of
so doing have acted accordingly. The recent nves-
tigaon Eno the affairs of the Boston aud Maine Rail-
road Company led to that result and the stockholders
will reap the benefit Of It, In this latitude rail
road managers have system differing slightly from
that practised the East Most of our railroad com
panies continue to pay dividends, whether they
them not, and frequently, the less they the
larger the dividend declared. Our railroad managers
could not get along at all, If their construction
seuntn closed and in most Of them this account
is up rapidly by the payment of dividends, as
by outlays the line of road 1t is the most difcnlt
thing in the world to get insight into the affairs Of
any Of railroad companies and it only when the
stockholders fail in getting their regular dividend,
Of obtaining information which should have been pre-
vously given them by the management. Directors Of
railroad companies understand perfectly well the effect
OF passing dividend and they therefore avoid such
crisis as long possible In consequence Of this,
railroad companies go year after year. bankrupt,
getting deeper and deeper into difficulties and when
the fact be disguised longer an expose is
made, and general collapse takes place. So long as
dividends regularly paid, the stockholders accept
The reports without reading them, pocket
three four, Ave per cent ask questions reelect
the board Of directors and thing apparently
goes like clock work The payment Of dividends Is
known by every railroad director in the country to be
Apowerfu sedative and fails to quiet the
OF the suspicious and dstrusfu stockholder and
they therefore sacrifice everything for dividends II
forinstance, the Erie Railroad Company should sus-
pend the payment the regular semi annual payment
of interest the stock the consequence would be
most searching investigation into the financial affairs
and operations Of that company and the result Of
the most astounding expeditions of railroad mis-
management made of any railroad corpo-
ration in the country. The management are
perfectly of the effect; and long the credit
Of the company will enable it to borrsw sufficient
to make up the deficiency the interest the stock is
to be promptly paid. Unfortunately for the
cess Of the plans formed by the management the
sources Of the company rapidly depreciating and
the time not far dstanu when Developments SINH
lar to those forced from the managers of the Norfolk
County and the Old Colony companies, will be ade
to the stockholders Of tao Erie Railroad Company.
The Reading Railroad Is evidence of what gross
msmsn agement will effect In the most favorably
located and judiciously contemplated road In the
country; and Il lie firm convi,on that few years
will suffice TO place the Erie Railroad in similar posi-
ton. The Reading road has q unimied amount Of
business and its annual income Is enormous The
Erie road has comparatively limited resources
regards business and its income, thus fa has been
Q mere bagatele. The traffic the forme Is more
profitable than on the latter, as 1t is onhned
to less extent Of road and is not affected m,ch by
composition For the purpose of placing the reStive
position Of certain railroads In a proper light wean-
mex table, showing the cost income, expenses, Sc,
Of three companies up from most recent and
reliable suthorities:-
COsr, TRAFFIe, &C., OF THREE RmLRoADs-1sto
p.,. Railroad s SS rsS Scso csc ''i'
Bait. Ohio 4 r. $4,000 10000 10000 81 a IS
We have put the items down In round numbers, that
It may be understood approximating the actual
tate Of things, imperfect reports and
irregular dates will permit. The net earnings of the
Nssding road amount to 100000 than the gross
some OF the Erie, notwithstanding which, the Read
e company have not and cannot make any dividend
N It's stock The Baltimore and Ohio road earns City
'ent more than the Erie and has fifty per cent
capital, and still the Baltimore company pays no
pdends on it's stock In cash The Erie company,
a. trihing amount Of net income, pays six and
per cent, in cash. capital and debt Of fifteen
~ fliions Of dollars.
will be seen by the above comparative statement
st the market price Of each stocks regua-
ed, almost entirely BY the payment prospect o;
sivdends. Very little regard appears to be paid to
Sources from which the derived pay these
dividends, whether they earned or not but entirely
40 tEa han In rhio oh IT..
and Ohio Company earns every dividend paid, and
could pay them in cash but from policy pays them in
scrip. The Erie Company does not its dividends
but, from policy, pays them in cash The Reading Com
papy does notearn dividends and does This
lie the position Of each Of these companies, The poll
cy of the Baltimore and Ohio Company is the best /;
that Of the RediDg geod and that Of the Erie dec.
dedly bad enough The first pays no more than IL
earns the secod earns almost nothing and PAYS me-
thing while the third pays more than the arst and
earns less than he second. The inconsistency visible
In the market value Of our railroad securities IL
very great and enc Of the unfortunate termi
nation Of many " the speculative movements Until
we can get reports such as are entitled to public
confidence, stockholders in railroad companies will
never know anything about the Of their shares
ana all purchasesvil be made blindy. Operations In
g stock Of IN, old Colony Company illustrate the
ruth Of that depreciation OF ten per cent took
'laee In the market value, the moment the recent
ftWas published Last January, upon the publica-
on OF the annual report Of the Reading Company the
stock fell to twenty per cent and the bonds to forty
'our per cent and there would be pretty rapid depre
citation realized In every railroad stock In the country
upon the publication Of simple plain, clear state
ment Of their condition and operations.
The rhonix Bank has declared a semi annual dvi-
dend Of three and half per cent
The Commercial Bank Of Albany has declared semi
nnua dividend Of Eve per cent the capital stock
The New Orleans Gas Light Company have dec Jared
dividend Of four dollars per share payable at the sr
hants' Bank in this city.
The Court Of Appeals have reversed the decision Of
the Supreme Court In the suit Of the receiver Of the