The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1883-08-17
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Fr0yisions.
Quotations and Values.

The delights and agonies of Wall street are illus
trated by the shrinkages which have occurred dur
ing the past two years. These shrinkages may be
estimated roughly at two thousand million dol
lars. Such statement, however looks far more Sc
rous shan it is, the truth being that during the per
iod here referred to- the wealth of the country has
vastly increased, notably by the magnificent har-
vests of 1882. What has happened in Wall street
is simply this. The nominal value of the shares has
been cut down, and this has been done far less on
the ground of diminished values than by nanipula-
ton and freight. An illustration of this is found
in the report of the Chicago and Northwestern
road, Just published. The price of this stock has
apparently, dropped about 80 per cent during the
last twelve months. Yet the property of the road
has increased its gross earnings have increased and
its net income has not suffered might be inferred
from the nominal value of the stock. During its fs-
cal year recently ended, the road has operated
about 800 miles in addition to the 1000 miles oper
ated during the proceeding year, all obligations
have been met dividends have been honest and gen.
erous and yet the value Of the road has gone down.
if the gentlemen in Wall street are accepted as the
proper judges. 1t is proper to infer them that the
quotations Wall street cannot be accepted as the
final criterion of values.
The same fact may be established by condition
al case. For some reasons our government bonds
command very high premium. Yet if these bonds
one half of then were suddenly offered for sale
in Wall street, railroad shares are the price of
the bonds would 60 down very fast, while their real
value would remain substantially unchanged.
From this fact practical rule of conduct may be
derived. The owners of shares usually estimate
their value at the current quotations. When they
try realize the quotation value of the shares the
experiment usually fails, because the mere offer of
share on sale sends its price down. And, indeed
the whole mode of measuring values as is done in
Wall street is questionable, although Wall street al
ways operates on the assumption that money is
fixed measure, possessing fixed value. How futile
this is may appear from computation lke'the fol-
lowing
In 1882 the country produced about sos million
bushels of wheat worth in Chicago year ago. about
81 Is per bushe while che 400 million bushels Of
oats were worth about so cents bushel and the
1920 million bushels Of corn about 50 cents BUSH
ell. The Chicago quotations are those of year ago.
and seem to represent the following amounts
Wheat, worth. $3.50, 750, 900
oats, worth .....,.... ........... 145 ,O0O,OUO
Corn, worth 7ouO,uoo
Total. .........,......... ....s2, 2o2, 10000
These figures are not what the farmers received
the consumers paid; they simply represent the nom
inal value of the three kinds of grain year ago in
chicago The department estimates the value of the
same commodities at about 1412 million dollars
But comparing the Chicago quotations of year ago
with those of to-day, aid the amounts likely to be
harvested this year. the result will be as folows;
Wheat, 400 mill bu., at 81 90. 80. $3.50 900
Oats, 500 {" 35e...... 175.000,000
Corn, 100 g 62h... 1,062, 100000
Total. ,"...,..............n....$l ,717, 900
Apparently, then, the crop, as far as mentioned
is worth very much less than was that of last year
and the difference approaches five hundred million
dollars. But, in reality, we have nearly as good
crop as we had year ago, and both crops yield a
gigantic surplus which swells the savings the CAPT
tai and the wealth of the country. We have more
producers and more wealth than we had year ago.
Yet if quotations were the final judge we should be
vastly poorer than we we're twelve months ago. In
any event, the quotations in the speculative mar
kets are not fnality, but an incident Boston Adj
vertiser.