New-York tribune., 1874-11-09
STOCK SPECULATION VS.. GENERAL BUSINESS
PROSPERITY.

To the Editor Of The Tribune.
SIR Shall all the legitimate and producing
interest OF the country be placed IN jeopardy that
q few Wallst. spectators may be enabled to realize
profit on their reckless venturesi That an expansion
| Of values at the Stock Exchange nOw-an expansion
which should prove to be warranted by no improvement
in the real values OF the securieswoud be serious
detrment to every branch OF commercial and indus
trial interest, must be apparent to every think
ing mind That strenuous efforts are now be-
ing made to create just such an ex-
pinsion and that for the accomplishment
of this purpose there exist regularly organized system
for the manufacturing and circulating OF favorable but
false reports concerning this or hatcompanyS finances
and busness-a system whose wheels are oiled by the
now almost universal refusal OF railroads to furnish the
public with any official infornaton-is fact which VIII
be clearly when the time arrives tnht the COM
panies compelled by law 10 make their returns Ole
by one the different railroad companies, as their earn
ins began to show too large decline. have followed
the example of the Commodore" and resolved
themselves Che Presidents and Executive Com
mtees) into close corporations. Lake Shore ana
Michigan Southern continued its weekly report OF earn
ings until into March, 1874; Chicago and NorthWestefn
until June. and Milwaukee and 81. Paul, whch showed
Increase up to August only ceased In September
when il had reached week which showed loss OF Al
per cent; aud so been with all, until now there
remains but company Toedo Wabash aud Westerly
of what are called the active stocks that continues 10
report or the other and lines which are report
Ing it may be remarked that nearly all are reporting on
an increased mileage
The following incident which actual occurrence
will serve 10 Illustrate the moies OF deception
now practiced About the cOh OF last september we'll
known active spectator having heard the ruOr tNat
certain railroads earnings Tor the prrylou. wceH
with usual promptness gave an order to sell
600 shores OF its stock; but being also Prudent man
nc at The same instant, sent 10 bgh O1l;lal ot e
company TO have the rumor confirmed; the
reply returned 20 tne effect that the earnings hia
decreased $4,000, where9p0n the specla.ol Ptooav%y %
disgustcd rarnas lac had supposed he haiIthlt he
loss as so smailabout S5 percenO-lmmedia'eyD Dognt
stouIy asserted that he knew the decrease Wai ony
e2CCO It's perhaps unnecessary 80 adi tat Tue hfX @
official figures OF decrease OF sll2,42o but, .ihe
this same hign Official now gives tnc n-,7s 10 i
personal" friends they good until the next ahhud
large norton OF the Press o. this city, represented
in its financial columns appears 10 nave become i-
pressed with the idea. ilat III some Mysterious ", m
imitation Wa-st aids ant g.v,s encourikedlent 10 "a
rene we'd general prosperity II mas Dscone qM1 M ne
"proper" tnlsg TO say aud write, t@nat nay Is "d', n T.,
meaning stock specuatiOu) was the h.St itst i ~ ~
strike the note OF warning g. So must 3e .e nt 70
sound the note OF restor itlou ioao on'nnnsitor
probably never employed tle tlile VI % i,,S,,,o
The stock Exchange experienced qui'e satP leFls"
OF confidence last January aG .o m retnrninS nros
told II tae sure hIron~er U. ~ ,e nor
perity and splendid Spring trade Alas! IL c.e @ ot
and Cong ess Tor ITS delay on tnG I'M Win an"tber spur5
made the scapegoaL Again III July WIN WIN "a aao'u % ~,
of speculation were promised an ine Euoa 'OoiS
az the the coming FANS DriliIlh iile IL i
unnecessary 10 here relate now hear curect MT
ipancill economists have been ln their prcctlon; p.
II Is well to that they are thc SINE who axe axe
nny he m discover in each fractional advance OF me
nrce of fancy stocks the sure sign vi
health and vgOr the entire coineFcII ana
t. Tne nrDposon Is in itself only less ridiculous
than the charge now made ny the siho Wiuas lis fr Ea
" j. dnc the present low price of wheat. and con
seguently all troubles AZ apoloSS - rue @ Lot
baxinc occupied 50 much OF your space WIN theH NaH
aries. o4.orood ,bo, rho greater any
Il.
hef yyI not be found To work well The panic OF sep
teiber 1873 commenced dhd wa uoSt SeNer' Win t
ratjro,d interest for the very PLAIN ana slhpe reason
tuat IN il was found the weakest spot II Delng th9
most extended. the most oaded dowh MIN ddne m1re
~ffansive sOwing 10 the wind" business than any
Of course had 10 be the first to yield to
adverse pressure IN the recovery this interest nav
INC the greatest errors OF the past 10 correct anu u
d nor the first It viii be indeed strange. two
or three years hence-whcn the country WIZ he gene,
rally doing good and paying business out smaller and
an a more economical plan than OF ate-if the stocks Oh
some OF oar railroads which have been paying dldehds
ont OF capital account during he hds times OF Tue past
do not sell az prices whcn would now be considered 100
low even for iirst-ciass panic such was Tue
nanaremeut for the period from 1869 TO 1873 IS
buG an enlarged copy OF that from lSo2 10 1870
holders. ei1 as y wa,ered capital muped both dvi
deuds and under OF construction accounts pay
ca sh dividends. until 1t had outgrown the ahly OF the
country support and the inevitable result was seen
in stock like Of Michigan Southern, whlch IN 300
maid stock dividend besides Its 10 per cent cash dvl-
dend aud was considered low at l3G afer many ater
nate DeriOds OF strength hDu WcdhncsS uiIis
after the panic OF 1851 nay selling at its lowest polnt
IS per share in 1889, two years AFTER tue genera p
ness OF the country had touched hard-pn otoSh'
gambling affects the real business OF the country as ~
tie AS does Faro" except when running 9a nss ~
endaugers Legitimate business by having 700 hee uss
of bank deposits The NewYerk Central Kafoau "outa
be lust IA beneficial au institution hu " e @ ion Ion
Tetrn only on its real instead OF three times tnat
amonnt and It's usefulness TO the country woulu not De
i, :, rho mice Wast put upon its stock was par.
inpsad az about 25 present real price Inc wealth
~ anntrv is neither Increased nor decreased by the
M 9i s,o Sf WaIEst that only from mother
a.
t, m moor as past Is years as IL consumes more
hn s.,' - - earns word TO the wise is sufficient.
Neg- York Nov. 6, 1874