Morning journal and courier., 1881-09-07

sournaI arlo Gourier.
Wednesday Morning, Sep. 2, 1881.
ALARMIsTs ANSWERED.

|
 Much has been made by prophets of evil
 of some interesting figures recently pub hshed by the FinanctdE Chronicle These 1 figures showed that up to September 1 the 1 securities issued or subscribed for the construction of new railroads were: Mort gage bonds, $221, 1s3, 900; income bonds, 1 $25, 759, POO; stock, $143, 37O, ,O0O. For i'm l provements, purchase of other roads, or on
 consolidation: Mortgage bonds, $75, 169, 900;
 income bonds, $21 ,5o0, GOO; stock, $147,- 1 015, 200 Without valuable consideration ::
 Income bonds, $4, 225, GOO; stock, $s2, 7os,- 700 The aggregate of all these sums is l $671, ,OO0, 900, and it was estimated that the 1 cash payments made or to be made, on ac 1 count of all of them was $389, ST, ,22O. There
 are two ways in which the alarmists look at these figures. They declaim against the is- l sue of securities for which no consideration is given, and they are alarmed at the rapid absorption of capital in building roads which they say are not needed.
 The Boston Aduertiser calls attention to the fact that there is an answer to be given to both these complaints of the alarmists Con- corning the issue of securities for which no consideration is given it says, with truth, that in 8 majority of cases where stock of railroads is given as bonus to the subscrib- CTS to bonds, the risks assu med in building a road are great. Capital needs a little coaxing under such circumstances About thirteen millions of water, in the shape of income bonds and stock, contained in the above statement, is given to investors in the two leading Mexican railway enterprises. Most of tue other large issues are for roads in the South or in the far Vest Whatever obiec- tions may be made to the system it is fact that some of the most important western lines were built upon it, would not have been built if it had not been adopted, and are now prosperous lines, paying interest on the bonds and dividends upon the stock. It might almost be said with truth that there is hardly mile of railroad in the States of Ne braska and Kansas upon which the stock was not given to the takers of the bonds. The policy is adopted not for the purpose of swindling somebody, but because it is the only one that is effectual in procuring the means to construct railroads in the West'
 
 of 390 millions cash for single year, the Ad0e7tiser admits that at first sight it has a look of justice, but it points out in the first place, that large part of the sum is only subscribed, to be drawn as needed, and that careful analysis would show that little if any more than one-half of the immense sum named IS to be spent this year. Some items, like the thirty millions of the Oregon Transcontinental, represent pur- chase by a syndicate of property already in existence and therefore only change of in- vestors. And even were the whole sum to be set down as fresh investment. it does not amounts to an addition of ten per cent to the amount already invested in railroads, and the length of railroad provided for is nearly or quite 5000 miles. Then, too, nearly twenty millions consists of subscriptions, which may never be called up, to telegraph companies, some other millions are for the Isthmns ship railway scheme, and the list abeunds in items of bonds sold or offered in Europe On the whole, therefore, the Ad- gertiser thinks that it does not yet appear that the country is over-investing.