The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1856-12-18
Ratlrnad Speculation.


begun in the years 1850 and 1851. which re-
ceived temporary check in 1854 through the
fraud of Schuyler and accidental embarrassments
arising from other causes, is now progressing
under full SAIL and rapidly approaching its goal.
Never, at any former period, was there 50 much
fictitious wealth in the country. OF ba.k loans
there are at the present time near eight bundled
millions of dollars; OF railroad stock and bonds,
twelve hundred total independent Of other
minor expansions. two thousand millions OF paper
wealth. OF this enormous aggregate. the abso-
lutte value OF the former item-the bank loans
depends upon the general prosperity Of the na-
tional trade So long as trade continues pros
porous, these securities may be fully represented
ny real wealth when reverse comes they may
tall in value to any extent As to the second
item, twelve hundred millions Of railroad paper,
this never was fully represented; for 10 many
instances, more stock was created at the outset
than there was money expended, as for instance,
when the directors Of the Central added at 4
blow ten millions to the capital without adding a
dollar to their intrinsic wealth and again,
many roads finding that they could not earn or
legitimately pay cash dividends, have resorted
TO the paltry scheme Of paying dividends IL
stock. which was tantamennt to saying that be-
cause their enterprise could not pay seven per
cent, therefore it should be made 70 pay ten.
From these reasons, under the most favorable
circumstances, the actual amount OF railroad
stock and bonds afoat never had or could have
any real adequate representation in material
wealth.
But further than this. toe roads OF the United
States are not now worth half what they cost. In
the first place, they We're never properly bails.
They cost one-sixlh Of the cot Of English roads;
one third OF that OF the French and most OF the
Continental lines. They were hastily put toge-
ther. with slight rails, slight bridges. himsy
structures, cheap equipment. niggar!ly accom-
mediation OF every Kind. This IS known TO eve-y
railroad man; aud, Of course, the deterioration
must be in proportion 10 the cneapness Of the
prime outlay. Further, the system Of b7ildiDg
competing lines has now rendered Il q matter OF
certainty that no road can be expected 10 pay in
this country any longer than II win take % bud
n rival to it. The emily roads in the United
States which are really earning ssveu per cent
"a their cost are some OF the Western lines
which run through table country enjoy mo-
nopoly Of traffic, and charge Of four cents per
mile Tor passengers. and eigh. and ten ccass pc
mile per ton for freight
II may therefore be assumed that, O. the 81
2o0,oeoooo Of paper flsa,ing through this coun-
try in the shape Of railroad stock aud boads
very large proportion has no real material req
rescntative whatever. II i % much waste plpar;
Of no more real yaluc than The notes OF wild Cat
banks or shares in AN exploded lottery.
Those who feel disposed to question this as.er-
ton--if any such there Devil find material for
wholesome instruction and profit ia the recently
published reports Of the New York Central and
Eric railroads. These arc the Tritons OF the
railroad world. They coss more money, do more
business, enjoy greater fame employ more talent,
aud we may add. practice more lcgerdemlin tasn
any other roads in the country. What We fnl b.
be their practice. we pay assume 70 be that OF
the other three hundred and ninety OF four hun.
dred roads scattered throughout the oouairy. OF
the two, the Erie appears the better enterprise
for il has cost two millions Ices than the Ccn-
trail taps the stream Of Western traffic further
west and more conveniently than IL rival,
and carries produce direct 10 the seaboarJ,
while tic Central doc not convey il within 40
miles o: shipping port. This Erie road, tgo
years since, was on he point Of bankruptcy. Hav-
ing Tor length Of time paid dividends which II
had not canned. il was crushed ut last under
the weight ~ the floating dob. Il had thus il.
CURED, and was reluctantly compelled "a dis
close some a. its secrets. Rescued from ruin
by the efforts of some foreign specuiators X
has pDrsued for the past two years the coursc
~ tho reformed ond peniscnt spendlhrift r.
has cit doWn IL expenses; Il hls dl.-
posed of It's useless stock; Il has reduced
liz telegraph stations: IL has moved heaven
and cara to do a quiet, honest and steady
business. Nor bas fortune been adverse.
II has happened no accidents, no food
have carried away iis bridges though tiny invite
such calamity; no iines have destroyed its CON-
hustible buildings; no portion Of the road has
yet given way. For two years It has pursued
this steady, sensible course paying no money 70
liz Shareholder and practising the most rigid
economy in every branch q its business and
now at La, II comes before the public and de-
clarcs-a dividend? No, u declares that the
stockholders must nov lend il couple OF millions
more dollars. Can anything b. palmer than
this Yet in the teeth Of this report, the dircc-
tors OF the Central company, the unequal con-
peti,or of the Erie, and road 50 circumstance
that The directors are a. the mercy Of their own
employees and dare not discharge them for The
grossest Offences, dare 10 come before the pubic
ard say that TREY have earned ten per cent o.
SIS 600 600 Of stock.
The history Of tbe Central and ths Erie i that
Of nearly all the railroads IN The country. They
are a gigantic aid to commerce, agriculture and
civilization, and much as they csst, the country