New-York tribune., 1876-10-07
CENTRAL AND II. r. r. r.
A PARTIAL RESUME OF FACTS.
F0urfh Article

Fourth Artteis
We have now reached point in the investigation
of the New-York Central and Hudson River Rail
road Company where the mass of figures that have
been spread before the readers of The TRIBUNE
require some comment
First: It is necessary to call attention TO the fact
that this company makes no report TO its stock
holders That excepting its chief managers, every
one has remained in utter ignorance Of its financial
operations That il has been and still is the closest
OF all close corporations That the same inyiolabie
secrecy that sprnEg the famous 50 per cent
scrip dividend upon its Board Of Directors
late one Saturday night in the Autumn of
1865 has been serupulously maintained
down To the present time-and by way OF
parenthess it here may be said that at that time
Encouragement did not deemit necessary topublsh
letters of advice assurance to the public: That by
common report even its Board of Directors are quite
ignorant of the companys AFFAIRS and simply Ill ac-
cordance with previously y-receiyed instructions
record their votes. Hence it should be borne IN
mind that Che reports made to the State Engpeer in
accordance with the laws of the State, and which
we have been considering, are the only source of
information on the subject accessible TO either the
stockholders or the public. If these reports ne
cessitate conclusions and nferenceS unfavorable to
the company OF to its management, The TRIBUNE IS
in no sense responsible for it, We have simply re-
ported the company to the public it reports itself
to the officials of the State.
Second: That since 1865 the stock Of the company
has been increased, simply by the injection OF
"waterp the sum of Sf7, ,92S,0O0; that since then
construction account has been increased so that the
excess Of capitalization over the alleged cost on
Sept 80 1875, was 933 09G,225; capital per mile
of road in excess Of alleged cost, $4,000, and per
mile of single track S1G,73O. These remarkable
.f, Iei,r md Of f9P IN
important bearing aud application than is usually
supposed. 1t is not simply a question of water
in familiar street parlance nor q clever trick OF
fnancering by which shrewd managers be-
come rich by stroke of the pen. But the
creation of such a vast volume OF fictitious
capital strikes a deadly blow at the funda-
mental principles of political economy, which
sooner or later never fail TO reassert them
selves 1t is IN fact a proceeding just as lndeien-
sible as for a manufacturing company to collect
money upon raised invoices. railroad may ENJOY
fictitious prosperity when every interest, enter
prise and industr, of a country is under like lie
titious stimulus and is upon false and inflated
basis but when things return to their true normal
conditions capital invested in railroads is subject 10
the same law of interest and reward that invested
In anything else. An application of these recognized
principles of political economy raises serious ques-
ton with respect to the enormous fictitious capital
of the Central and Hudson River Railroad Company
With bubbles bursting all around ms, with the
country fast abandOningis fictitious and false lights
aud rapidly planting itself upon the terra frma OF
real prosperity, with the question of railroad trans
portation subject to the inf1lliole law OF
free competition, with capital begging for
chances to invest at 500 per cent
and with people groaning under the
heavy burdens of oppressive taxation, can he other
than question Of time as to how long the Central
and Hudson Company can maintain or the public
afford to submit to transportation charges sufficient
TO pay the large interest of per cent on the enor
nous amount of $4702S,O0O of,fottious capital
The foregoing remarks not to be construed as an
admission on our part that the Central and Hudson
has heretofore earned the dividends which it has
paid.
Third: The figures which have been presented
show that the additional charges for construction OF
foad and tracks since Sept. 30, 1870, have been
lOliOWs: