The St. Johns herald., 1890-03-13
The Migration of Capital.

year or two we have been hearing
 of English syndicates buying Amer
 ican manufacturing plants and pay
 ing almost incredible prices for
 them. Solid cash is paid for some
 of them, and 1t is one of the pug
 zles of the day to know where the
 money received has been reinvest-
 ed. Other English capital is going
 into Australia, South Africa and the
 Argentine Republic, although not, as far as we are aware, to anything like the extent that it is coming to America. In the United States there arealso seen vast movements of capital from one section of the coun- try to the other. For forty years
 there has been a steady investment of Eastern capital in the mines of the far West, accompanied by an Eastern movement of the gold, sil- yer, copper, lead, etc., from some of these mines-alas for the inves- tors-not from all of them. So there has been a movement of capital both from England and our Eastern States into the West for the purpose of covering the country with rail- roads, and, to the extent that these have paid dividends, some of the money has come back again. More recently there has been the great business of Western farm mortgages and investments in town lots in real or hypothetical cities. Another great movement is that of New Eng land capital into new cotton mills in the South, together with that of Pennsylvania capital into Virginia, Tennessee and Alabama iron works. The crude iron industry of New England seems destined to extinc- tion, since it cannot possibly com pete with the cheap fuel of western Pennsylvania and with the cheap ores of the South, and New England | capital must either seek other forms of investment within its own bor- ders or go elsewhere. We cannot share the opinions of many writers that the influx of English capital into this country is an evil, and that i there will be a constant drain of profits out of this country as the result. Dividends will undoubtedly l be sent out of the country, but much of the money so sent will come back for reinvestment, and will bring other money with it. The money invested here in new manu- featuring plants, when a market can be found for their product, gives employment to labor, and the more labor there is employment for the greater will be the home market for the farmer, who now produces much more than the country consumes. The transfer of capital from New England and Pennsylvania to the South is certainly good thing for the South, and, indirectly, at least, a good thing for the whole country. New Englan's pig-iron industry may be destroyed, but New England cap italists will get better return for the money invested in Virginia and Alabama than for that invested in pig-iron making in New England. If the South IS made rich by manu- featuring raw iron and coarse cot tons, she is more able to buy the finer products of New England, in which New England will, for anoth- CT century at least, stand supreme. There may be such thing as too much transference of capital from New England to other places. The Manufacturers Gazette sounds wall of distress as follows:
 "New England people have mill ions of dollars in Western railroads that have shrunk in value $1OO,OOO.- 900 in three years. They have s1OO,- 100000 worth of Western farm mortgages not worth 90 cents on the dollar. They have millions of dol lars sunk in Minnesota, Colorado, rizopa and Naw Mexino tha bora