St. Paul daily globe., 1888-05-01
The Stock Market Closed Yesterday at
the Top Notch for the Month.
THE OUTLOOK FOR MAY.
A Much Greater Appreciation in Val
ues Of Stocks Can Hardly Be
Looked For.

Marcn. Inc temper or speculation Is
entirely changed, and bulls, not bears,
for the moment seem in control. The
reason of this entire change of temper
and Improvement i'll values is found in
the removalO of many of the complications
which closed the month of March under
very dark cloud. The strike which
| then not only crippled the Burlington
system, but threatened to tie up all
other roads, has ended. The flow of
gold to the treasury is offset by free pur-
chases of bonds daily by the secretary
of the treasury. and increasing deposits
in designated depositary banks. A re-
serve in the national banks tending
lower each week, has once more COM
menced to increase, and the new month
finds the New York banks not only with
an increase for the month, but far ahead
of the same period last year. These
factors have formed the basis for the
heavy appreciation i'll stock valueS-an
appreciation representing large
amount for the list. The fifteen stocks
quoted represent an increase in market
value of over S50,000,000. While this
marked Improvement in prices is en-
couraging to holders of seeuri-
ties, conservative men cannot help
but question the stability of
such an advance, Cheap money
and an increase of capital in the great
money centers, where it makes it easy
for the borrower, at the same time often
indicates lack of demand for money in
the various channels of business
throughout the country. Decreasing
loans, which the New York bank state
ments have recently been showing,
would seem to indicate lack of demand
and the absence of new enterprises.
We are nearly 900, 900 tons under last
year in the production OF rails, and in
other branches of manufacture depend
ent on railroad construction the same
apathy is reported.
MONEY Is CHEAP
and in large supply, but the clearances
of the banks throughout the country
show heavy decrease from the same
time last year, as but 3 per cent of the
transactions in business are made in
actual money and 81 per cent in checks.
This fact points to decrease in
the interchange of raw and manufact-
ured products, the play and counter
play of business that is worthy of note,
and has a decided bearing on the future
course of trade. While the market
value of stocks has been steadily in
creaSing, the earning power of the roads
they represent has seemed to be on the
up between the granger roads in the
Northwest and West, but this seems
likely to end with the month just COM
mencing. With but a light local traffic
the Chicago, Burlington & Northern
must look to the through traffic for rev.
enue to meet fixed charges. Coming
into field already well SUPPLIED with
facilities for transportation, only by
making concession in rates can 1t hope
to secure business. To this end it has
cut rates, and is now carrying
-four at ~ cents per 100 against
the 1219-cent rate of the other roads be-
tween Minneapolis and Chicago. This
rate leaves only the transit flour for the
old roads; all that freight coming in
over the Northern Pacific and Manitoba
roads and therefrom, not subject to the
transit rates, going to the Burlington.
In addition to this the road also insists
on making rate from the East
which will compete with lake and
rail to st. Paul and Mime
apolis, introducing new factor
into the matter. Its present position,
favoring as it does st. Paul and Mime
apolis over Chicago, naturally enlists
the active sympathy and cooperation
of these cities, and must bring it traffic
naturally belonging to the old roads.
1t is scarcely likely that the old roads
will sit still and let all their business go.
A participation by them reopens the old
fight with increased bitterness.
IAN impression is gaining ground
daily that no permanent restoration of
rates is possible until some of the old
roads purchase the Chicago, Burlington
" Northern. The decision of the su-
preme court of Minnesota as to the
power of the railroad commissioners to
regulate rates, the passage of new and
severe laws in Iowa touching this sub
ject, and the action of the Nebraska
railroad commission, have placed roads
doing business in these states in a very
unpleasant position, and seriously
threaten their revenue. The March
statements of nearly all the roads
show heavy decrease in earnings and
while in some cases gross earnings
show up well, operating expenses have
been SO largely Increased that net earn
ingS are in some cases represented by
minus mark.
''PreSidential years are usually
TIMES OF DECLINING VALUES.
especially when some vital issue is be-
fore the people. 1t is a strong cOinci-
dence that just as the tariff debate is
opened in congress reports from all
sections show heavy decrease in buSi-
Three of the largest manufacturing
concerns in the Northwest report a
great drop during the last half of the
month, and roads which found it i'm
possible TO furnish caIS to shippers now
have great numbers of cars standing
idle.
conservative men in railroad circles
are inclined to take in sail and prepare
for period of light earnings. New
roads are little talked of, and the
unwisdom of some already con-
structed is now appreciated. Boston, that
great treasury from which the country
has drawn so heavily to bind the West
with iron bands, seems inclined to call
halt, and is turning money into other
channels. Real estate is gaining in
favor, the recent heavy investment here
in st. Paul being, it is thought, but the
first of a series of such purchases. Bos-
ton capital went heavily into Union Pa
cific, under the lead of Adams,
only to find declining value.
1t touched Atchison, Topeka &
Santa Fe, but to see the same
decline in value. 1t followed Elijah
Smith into the Oregon securities, only
to find that they refused to follow the
Bible simile, and, like the ravens.
FEED ELIJAH AND HIS FRIENDS.
lit is but natural, therefore, to find a
Discrimination ON the part of this capital
to enter into new OF support old rail
road enterprises. The Northern Pacific
earnings have shown steady increase,
but the increase comes entirely from
passenger traffic, the freight earnings
in nearly every instance showing a de
crease. Their passenger traffic is
largely to Oregon and Washington Ter
ritory. and while producing at presents
revenue to the road, goes to build UP a
country tributary To the Pacific coast
and the product of this new settlement
will seek an outlet there, be carried ip
English bottoms abroad and thus escape
paying toll to our tranSeontinental
roads.