The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1855-09-29

The truth fairness Of these statements We have M
to doubt The officers Of the several companies
ofhe highest character, both for honor in
teigence. They could not for moment be supposed to
be guilty of the foy-to say nothing of the impropriey
OF making estimates which the end Of the year might
prove to be exaggerated. Assuming then the 6guress
be substantially correct must say, they some
very curious facts 1t win be that while the stock
of these companies is selling in the market at difference
Of less than twenty per cent there is range in the
tua net profits of some $50 per cent Taking Michigan
Southern as the basis and calling it worth $50 per cent,
the stocks should stand as follows--
Chicago csS soI and Facs island per CENT
Michigan Southern and Northern Indiana. $50
1aiena and Chicago.
Or take Central at par the relative position the
stocks, according to their net profits, is as iolows-
C ce~ aol IA Central per cent.
Snicago ana Rock Island ................200
Michigan southern and Northern Indiana. $50
oaeha una chicago .....................5O 500
Why the New York Central with its bare eight per
cent, commands in market price very nearly equal to-
stocks earning double and quadruple the
money net we confess we at loss to understand.
We should suppose that any person capable Of telling the
difference between, eight sixteen twenty and thirty.sx
dollars would not find il very difficult to decide where to
invest his hundred. True, the Western companies
do not diride quite this amount; but they earn
it-and that is the great point for capital
lists to look to. They do not divide all their earn
ings, for the reason presume, that they have re-
mote suspicion that in process of time portion of
their property may by friction rust other natural
accidental causes out and require renewing. In
this notion they peculiar. They differ
from the apparent opinions of nearly all other railroad
managers They wiinsis upon increasing their reserved
fund from year to year. in ratio evengreaer than their
increase Of receipts The stockholders cannot however,
be greatly damaged by this. If time shall prove that
these gentlemen are mistaken, that railroad IRON and
ties, and bridges, and engines and cars &C., not
like other stuff of the kind subject decay the money
viii be in hand and be handed over in the shape Of
extra dividend.
One would suppose, in view Of the above table that
the Central to maintain itself in the market nearly on
par with the other roads while its net earnings were
comparatively very far below them, must have some
peculiar and extraordinary advantages therein men,
toned. That newer fresher cleaner-less worn
and decayed that its stock had been waered
under better management that had larger surplus
on hand; cost less per mile, was without competing
railways and water communcaton-in short, that il
could, for the future, give better guaranty for the
payment of its dividends than the other roads. Pre-
cisey the Of all this is the fact Central is
passe 1t not only has the govt and the ricketts, but IT,
compelled to carry weight for age" The monster has
Over-WaLefeu,
another drop would break its huge back. There has
been piled up his road up,udrd Of $40 600 600 Of
stock and Io,ds, not dollar Of ,chich epr spent
on the property Its track and equipment, notwth-
standing large portion of the proceeds Of the last years
3OO0 600 issue of bonds spent upon them, is old
worm-eaten, rusty, and rapidly decaying. No
ion whatever is made from earnings to meet the i'm
depreciation of this portion of the property By
the skin Of their teeth they pay their eight per cent dv
dend leaving the idea Of depreciation renewal fund
totally out Of the question The inevitable result Of
such must be another So 900 issue in very
short time.
Thousands Of people hold TO the Central they do
old horse that has done them good service There
have been times when to hold it a fortune. Men
who invested small sum found themselves few years
rich from fat dividends in cash. and four i've times as
much stock they started with. Central has friends,
and well it may have. Twenty million Of dollars
hardly be squandered three hundred mile road with
out attaching somebody to it, from gratudeif not from
the hore of more But Central has had its day. It's
fine pickings its doubling Of stock its rich dividends,
at end Its dividends have dwndled to the poor
patry allowance of eight per centa two per cent
below the ordinary of real estate investments. This
is squeezed out with the utmost difficulty and must
dwnde to seven six and probably five per cent When
il reaches that figure shall expect the old foges
wake up and begin to look round for better invest
ment.
The Boston Journal in speaking Of the depreciation in
railroad stocks in that market, says
II cannot be denied that people have had good
for distrusting railway securities in the unfortunate
perience Of the last two years. cement failure
and frauds have had their effect and ID not surprising
that owners Of this description Of stock have become
thoroughly Disguised and dsheartened. Scarcely rail-
way in New England but which in way has disap-
pointed the expectations Of its friends and after
other has diminished its dividends been forced tempo
rary to suspend them entirely The result Of oil this
trouble will eventually benefit railways placing them
a substantial and reliable basis and bringing
them under better management but meanwhile the
dicne s operating the system, and although the
patient is in fair way to become stronger and healthier
than before, the present weakness and prosraton is
natural and unavoidable return to regular and better
dividends will gradually restore the great bulk Of railway
securities to public confidence And until this period
rives il is useless contend against the Of popu
lar will OF what avail Is it say that such roads the
Ftchburg Providence for example, every day
progressing to better position, by the liquidation Of
their debts and the improved condition Of their tracts
and equipmentsY The answer is "No dividends and
the argument is alpowerfu in producing depression.
Stock Exchange.
NEW YORK Sent .9 1855