The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1856-12-17

Amount TO credit pTont and loss Jan. J. 1887 1851 500
This Is n semiofhciA statement; and as A. G. Flagg,
the Comptroller Of the city OF New York Treasurer OF
this company, we have no doubt 70 omanated from him.
Il viii be tina. arriving al the above result, the
operating expenses OF the road pu. down s about
thirty i've per cent This is known 10 be full fifteen per
cent below the actual cost 10 estimating the operating
expenfe tine low rate OF thirty per cent Ia figured
out that the surplus IN hand the LIST OF January 1857
would amount TO 1851 ,5as The capital Of this company
s ST. 900 600 consequently the surplus would be, the
time named, more than twenty per cent on the stock.
II has been determined 70 pay out Of this nominal oaih
surplus stock dividend Of l2 per cent before the 10th
OF January, 1857 80 as TO prevent any nee stock thai
may thai day be ssued for bonds converted fron
participating In this division OF the spos rs question
in mind the Chicago and Rock lsla nd Railroad Com
pany have In reality apy surplus. It easily be
shown from their own figures thai the above sum Of
sslSbeb Is far beyond moss exsravassn, calculation
correct arrangement OF fgorcs you'd be m fol
ows least $3.50 900 should be added 70 The operating
expenses for the months ending December 81 1865,
and 500 600 deducted from the estimated surplus Tor
crued dividend stock. This would make the sum OF
s2sc goo to be deducted from the 1851 600 which would
leave but 5000, ooo Is per cen; the capital, In
stead Of 20 per can't the company estimates II errors
70 this amount be shown In the calculations for only
six month";. follows ths, some gross mistakes mus,
nave been made 10 the estimates showing tho Surplus on
the lst 81 July. 1850 TO have been sse7 2To II 10 the
easier, thing IN the vord FOR railroad company 70 make
estimates OF earnings and expenditures, but have
known OF the many put forth 10 be correct
independent Of the motive governing the ostsaors ani
perpetrators Of this fraud the way In which has tn a.
far been carried on about on q par with railroad
nnAnciering generally. Before making pubic the
plan proposed, The directors made up q combination
ar 40 nj inssdS rd havi Had
themselves with three leading bull spectators 10
Wall street, boughSup on time, principally buyers op-
ton, all the stock or the market Az soon thoy had
completed their arangemenu had secured all the con
tracts they DESIRED and had the trap 10 catch the shorts
properly SET they with their programme pro
pcry conoooted account current Ia presented, showing
great earnings and large surplus. IL shosn that
extra dividend Of large amount Is In hand, and the
usual preliminsries merely for Appearances gone
through with. Although the matter at the beginning
an cut and dried the directors held meetings. and acr
dolbera,on formally declare the ers dividend payable
stock. We have knowledge Of wha, IA TO be made
or the money which the surplus 10 supposed 70 be
posed o. Ills not shown that the extension or improve
ment Of the road requires such outlay The public
10 take Cor granted that the $751; 900 In money
msins In the treasury while the capital stock increased
20 represent H. With this reputed surplus In hand the
Chicago and Rock Island Railroad Company viii not reduce
he Indebtedness cent Upon reported cash surplus
have stock dividend, without any apparent necessity
for the expenditure OF the money the road II
thing less than stock JOB Ding scheme from be-
ginning 10 end. II originated among clique Of rock
spectators Wall street. and has thus far been
70 the full satisfaction o. the conspraors Tne stock
holders, body had knowledge OF the affair until
the board OF management and their Wall street asso
ciass had prepared their cornerns combination and he'd
arranged an their contracts In such scheme the bears
Stood chance. They sold the stock simply on 10
mssiss NOT dreaming Tor moment that the directors
would be desperate enough 70 resort to such desperate
measure as 10 declare a large dividend on . pom
nal surplus. Sock spectators do not stop al trinss;
and we have known greater outragss than this
prsctced By railroad directors. With the bulls The
game . Toe shorts were caught
and there alternative. with them Il wa,
Ike playing with an opponent who held al the
cards. Tha is nir illustration OF the danger
o. con,endIns 10 the stock market with those Who
control the books and hold the purse Of railroad com
psny The shorts have 70 contend with the combined
capital and credit q each company against Ill sorts