The farmer and mechanic. [volume] (Raleigh, N.C.) 1877-1885, 1883-04-18
I'll From Wall Street! A SIN
full Syndicate!

- in raiiroadIng. recently maze q tour
mecrioa over the RE mo d IL Dan
- srstem. They did no, find one d.!
~ of il payiug fixed charges
n main stem from Richmond TO
Nr1le-was earning enough to have
49, ;n,arest aud something over on the
kSnr ions which originally rested on it;
-, chen the company issued in addi-
sf@ ! / 100000 OF 0 per cent. debenture
"a. AZ IS cents on the dollar, thai
s ION of the system was at once bur
- beyond it, earning ability as much
smshe rest of the system.
i the estimate of the engineers who
- upanied the party referred 10 that
g. ut the lines In good condition for
hins an expenditure of 81, 900, 900 Is
o+i !Iniy necessary
Steel rails are a myth. In some OF
fhe .ompany's branch lines, the old strap
Yn1I and Ties laid lengthwise was dlscov-
ered to be IN use. The younger men in
he party then Jaw this contrlvance OF
the infancy Of railroading for the first
tin E.
TIE West Point Terminal property is
the short line between Richmond and
West Point. The old Dominion Steam
ship Company has its W line, and car
ries freight for the same rate from Rich
mont as from West Point. The Rich
m0nd Il Danville company, therefore,
has to do the san e; and gets no revenue
for hauling freight from Richmond to
West Point.
Hinder its charter The Richmond <
Danville company cannot extend its lines
bexond the limits Of Virginia. The
Wcst Point Terminal Company was or
Ranized as a subsidiary corporation,
Through which leases of other lines could
b made; aud through it the Richmond
d Danville line proper extends TO AT
lauta, ga. 1t also branches oil at Char
lotte, to Augusta, TO take the southeast
business.
The system is made mp in three divi-
mons, and not one of them Il paying fix
ed charges. Investigation by the in
specting party disclosed the fact that the
Richmond s DanviiIe section has a
floating debt of about 81 600. 600, bear
ing 10 per cent interest; the Charlotte,
Columbia Il Augusta s%ection, not earning
the interest on its bonds. has a fl bating
debt of about $3.50, OG0; while the At
hnta 4 Charlotte Air Line is leased It
$463, 900 per annum aud there i. an an
nuil loss to the leasing company on this,
Of about $3.50, 0O0.
ghe Virginia Midland Railroad is also
pai of the Richmond & Danville system.
1t uns from Alexandra to Danville. 1t
at one time belonged to the Baltimore &
OH; but Mr.. Garrett, having no use
for it in his system, sold it to the Rich.
mcnd & DanvIlle managers, who imme-
diately put upon 1t an enormous pie of
water securities, far beyond its ability to
carr interest on.
The New York people found that the
r. & ID. system was well worked, under
Superintendent TaIcott, The wretched
condition of the finances was due entirely
to the mingled dishonesty and in incom-
petence of those above him.
The Georgia Pacific Railroad Com
pany Is one of the allied corporations.
It is being built by a construction com-
pan, whose stock has been sold Oh the
etree at a high premium.
This road Is the e1tcution of the X.
d u. line westward from Atlanta across
Aia5ama. the objective point at present
being Birmingham, about 40 miles
from Atlanta, Ca.
The investigating party found this
r0ad, 50 far as built, running through a
poor country, sandy and barren, nearly
destitute of inhabitants, almost without
Stations for the reason that there was no
necessity for any; and with local traffic
insufficient to pay the cost OF running
the trains.
Everybody knows that when Genl. T.
M. Logan and the men with him, put
Richmond It Danville stock on the mar
ket, 1t was put on as an eight per cent
dividend payer. 1t was represented that
the syndicate had bought the various
lines composing the system at a merely
nominal price IN the times of Southern
depression, and the increased prosperity
of the country since had made them i'm
mensely valuable. These stories were
wild exaggeratIons. \ We know
it was not long before the company had
no money to pay even one per cent divi-
deud. But the stock was worked up to
$3.50 per share, and broke in one hour
SO per cent. 1t Is now quoted nominalEy
at "a.
INote-It has since raised to GI.-ED.
f. x VI
The West Point Terminal scheme was
ever more outrageous. This was rep
resented TO be of fabulous value. The
stock was run up above 2G0, aud when at
that figure Gen. Logan was flying about
from office to office In the street. saying
that he was going to put it TO 800 the
mex week.
After this stock had been sold to the
Street, the managers of the company
made a sort of assessment upon II. That
is, they called for 50 per cent cash on it.
for the purpose of buying steel rails,
niore equipment, etc, and for every 100
shares original stock and the so per cent
cash. gave 800 new shares. The stock
holders have never received a cent on
their investment, and the stock is now
nominalIy quoted at 30.
We cite an instance of loss on this
stock within our knowledge, and think
we are safe in saying It it has no parallel
IL Wall street. An investor bought LOG
Shares at .262. thinking it would prove a
bonanza. lie paid the so per cent as
sesrment and got the 200 new shares,
making his holdings 300 in all; and these
he holds yet.
Now look at the loss: cost of original
lou SnareS, f-b.SUU, cost OF the ZUI
shares issued by company afterwards,
g. 900; total, S3I, 200 for the 300 shares.
Selling price of these to day, s25 pei
Share, or =, 500 for the block. Direct
loss on the investment In 100 shares oil
West Point terminal stock. S23. 700.
This leaves out the additional loss of in
tcreSt.
The Georgia Pacific construction stock
IS an ther beautiful investment. Gen.
#l4ogan repIesc nted that this was 20 pei
cent paid up. and that at the most, only
one more call 70 complete stations, etc.
would be made. In fact. there was only
20 yer cent paid up; and 4 more calls
ave been mad,. The company is now
- n.Li.inr fnr sale 6 ST m%nrtgape bond.