The Portland daily press., 1884-01-08
Business-Old and New.
The Gloom sf Investors s--The Willard
Properfies-The New York 81 New Eng
land The Truc Foundation of Wealth.
Special Correspondence of the Press)i

DOslON, CdH' W AoSNs
The feeling among the merchants and inyes-
tors in Boston is one of doubt. 1t is found
that the transactions of the pasiIyear have been
equal or slightly superior to those of 1882; but
business profits have been moderate, and COR
poration dividends have been more so. There
is general opinion also that property mas de
preeiateo, and that the outlook is more or less
gloomy. This belief is supported by many
strong arguments. The surplus capital OF the
Boston people Is invested mainly IN railroads,
and during the past year most oil them nave
received q black eye in Wall street, wnere
people look if hey wish to ind out OF what
price they can sell their stocks aud bonds.
Union Pacific stock, for instance, has deciin-
ed IN 1888 from above par to fully thirty ponte
below par; Chicago, Burlington q Qolney has
declined fourteen points; New YORK q New
England over thirty points; Northern Pacific
still more; Oregon q Trauscontinental over
fifty points. few stocks, however, show an
advance, and on the whole is is an open qaes-
ton whether prices are too low now, or wheth-
er they have been too high the past. Most
people who buy railroad stocks do so with the
expectation that prices will advance, and that
the buyer will realize this rise. Bot tnis move
mept has its natural limitations. and most
people who buy stocks on speculation play
against wholly unknown chances. For the
men who control great railroad properties are
frequently engaged in similar speculatlons,
and Can proceed on fuller information than can
mere outsiders
This is illustrated By the untoward fate OF
the Northern Pacific and - New England
Both these corporations ought to have done
well, or fairly we'll, had they been managed
on ordinary business principles. As a matter
of fact they were managed like esspec ulative
enterprises, and the Northern Pacific confes
sedly 50. Mr.. Henry Willard president of
the latter road, organized what he himself
called "the blind pool aud thousands of
sober people placed their money 10 his hands
with that uHd erst anding. When MI. Willard
was unable to accomplish what he aud
his clients had expected, they charged him
with untruthfulpess. But the fact is that Mr..
Willard took an imaginative view OF his proper
ties, and that he tried to accomplish by finan-
cial strategems what ought TO be achieved SOLE
ly by carrying freight and passengers, and by
developing the country. 1t is true that Mr..
Willard promised too much, aud that his
friends took his word as one merchant takes
that of another in bona Jide trade But 1t is
doing Mr.. Willard an injustice to coDstrae his
promises about blind pools and such things as
one takes the word of banker who sells ex-
change. Poor Willard has surrendered his
private property he has largely reimbursed MS
misguided friends, and he appears 10 n nave
saved his honor, though he has lost all else.
Mr. Endicott, his successor in the presidency
of the oregon and Transcontinental, is some
what in similar position. His honor is un-
questioned, and his ability is supposed to be
buy into the Willard properties, and when these
declined, Mr.. Endicott was the first to step
into the breach. He is said to have promised
that he would reimburse some people who
bought on his recommendation, and it is very
hard to condemn him for error of judgment
which rested on the imaginative expectations
of Mr.. Willard. Whatever may be the moral
ity of the case, in law the rule is caveat
eDaptor-buyers act on their own peril.
Had Mr. Willard been successful, the owners
OF the Northern Pacific or Transcontinental
stock would have congratulated themselves on
their wisdom and foresight, and they would
have found many arguments showing
that the road which connects Lake Superior
and Puget Sound could not fail to be good
property. In a like manner, the stockhol ders
OF the New England road might have reasoned
plauslbly that line which connects Boston
md Providence with the Hudson river, the
Pennsylvsnia coal fields and the great Trunk
lines of the Middle States, that is to say the
New York Central, the old Erie, and the Penn
sylvania road, must necessarily become pay
ing corporation. Yet that property is now
drifting into the hands of receiver, and ex-
President j. FL. Wilson, who captured Jeffer-
son Davis, is blamed almost as much as is
Henry Willard, the son-in-law of William
Lloyd Garrison. The truth about General
Wilson seems to be that he appre ciated the
natural advantages OF the New England road,
while the people at large-iust as in Mr.. Viii
lard's care-hxed their eyes on the disadvan-
tages of the case. Willard and Wilson would
De popular men. had they succeeded in coDcil-
latlng public opinion, in pleasing Wall street,
and in making little money go a greater way
than they did. Both took charge OF property
which had bad name, neither is really
great fnaDcier. both had to struggle against
falling market, and both are Imaginative men,
who probably wonder why the ir honest en-
deavors have been received so coolly in finan-
cial and other circles. They fare as do new
governments, which ride into power when
crops are bad and misfortunes many. All
such governments perish, while most govern
meDts are popular in times of prosperity and
good luck.
The sharp remedies which have been suggest
ed in these cases will probably be expensive. In
asny event, the Northern Pacific and Transconti
nentsf Corporations will do we'll to consult Mr..
Willard, acknowledgements the properties better
than do other people, anu sss the highest in-
terest in making the stocks earn dI>i-snds. If
the New England road is placed in theAS.snds
of receiver, the latter will be dictator, aud
his certificate will take precedence of the first
mortgage bonds. The receiver is not amena-
Bile to the stockholders, and unless he is man
of exceptional ability, technical and financial,
the property is likely to diff. The New Eng
land stockholders, therefore, seem to be in
much doubt about what is best. What both
the Willard and the New E. gland roads oueht
TO do is to create confidence with the great
public which some how is determined not to be
persuaded into anything save criticism and
rash doubt. The outlook in these cases, then
is wholly uncertain. In other cases, recent ex-
perience has been only less gloomy,
Manufacturers are not happy, bank dividends
have not been large, and nearly every day
some unpleasant rumors are started. Because
one property is temporarily unproductive, men
conclude that all business may become unproh-
table. 1t may, but will it? The occasional
downfall of man, once thought honest, al
ways causes q shock such IS the people in Prov
ideDce felt when Mr. Samuel Biodgett turned
ont to be petty thief, though he had been
trusted, and had carried himself in church and
society as if he we're little above the average
of decent people. Let it be true that some
men are hypocrites, and that some properties
are rotten and feeble. The conclusion 40 ino
Gd 0ntneS, from one case as to all cases, is bad
! ioge, aud specially vicious IN business.
1t is true that we have had many failures,
but we have had worse year for failures,
| namely, 1878. 1t is true that for 1883 COM
mercial agency reports 9,1s4 failures; but what
is that to the remainder of the 1868 1893 traders
who have not failed? The debts which will not be
paid in full are 173 millions; but what is that
| to the thousands of millions which have been
| contracted and duly paid? 1t is true that, on
| the whole, prices have gone down. Bat de-
clining prices do not extiDguish or destroy
property, and clearly dollar is worth more to-
| day Than lt used TO c9 as lar as Duy1ng-pOWer
| is concerned. 1t is true that the investment
| market has been unfortunate; but what the
| rich have lost. the poor have gained. Is it a
| misfortune that the rich grow poorer, and the
Door grow richer? Most people have an idea
| that capital breeds It's own offspring after
method which psychologists call parthenogeu-
| esis. But reason and experience show that
| profits go in the long run to labor,-not manual
| labor alone, but to all labor. There are very
| few investments which take care of themselves
| and pay regular dividends.
| Very clearly, the country contains more
money, more property and more wealth than it
| did year ago. 1t is idle, therefore, to com.
| plain of these hard times. The true thing to
| do is to work, to save and to manage well. No
| power on earth will prevent men and women
| from speculating, but those who speculate
| should not deceive themselves on the risks
| which they run. If one speculation has re-
| suited well the law of probabilities teaches
| that the next speculation will turn out badly.
| The mere fact that one man has done well in
| one way, implies that tho next man cannot
| do as well, save in1nothsr way. Beside this,
| it is generally easier to create new wealth than
| to obtain the wealth of other people. The
hopes of 1884 do not lie so much in the proper
ties we have, great though they be, as in the