The Helena independent. [volume] (Helena, Mont.) 1875-1943, 1891-10-08
Two Causes Of tho Present Uncer-
tainty in tho Speculative
Situation.
The Solid Facts Are More In Favor
or Improvement Than
Ever.
Excellent Prices for tho Largest Crops Ever
Grown, Make the Outlook Favor
able for Business.

circular issued Oy tue panAluR nOus0 OF
Henry Clews q Co., II, ID and IL Broad
street, and IS Wall street, says: The specu-
lativs situation shows more uncertainty
than two weeks ago. Two causes are re-
~sponsible for this; first, the rest and reac-
tion which were necessary after the rise Of
5000 points within q few short weeks; and,
next, the development concerning Missouri
Pacific and Union Pacific which have
brought down a storm Of indignation upon
the heads Of the directors. All this abuse
was no doubt greatly intensified by the
fact that public sentiment was largely in
favor Of 4 further rise in values; and the
check impaired by the break in the Mis-
souri, Pacific caused more irritation than
would have been the case had the same
event happened in ordinary times. Much
Of this criticism was misplaced, because
Mr.. Gould has certainly taken a much less
active part in speculative operations than
the street. has supposed. His con-
dition OF health, as ' shown by re-
cent apparent authentic reports, absolutely
precludes that sort Of vigorous activity.
Personalities aside, however, passing Mis-
souri, Pacific dividend at a time when
nearly all other railroads are steadily max
ing larger profits. only emphasizes the utter
folly Of paying dividends that are unearned.
This road had failed to earn its full divi-
dend for over a year, but paid them out Of
borrowed funds; presumably OF course for
the purpose of improving the market for
the stock among those least informed, but
which eventually frightened out such hold
ers by suddenly exposing the secret when
least expected. The method Of paying div
idends not earned. if not illegitimate before
the law, 10 certainly most r~eprehensible
from a moral point of view; besides simply
creating a deep distrust of properties under
such control, which eventually acts most
iniuriously upon the management. Never
thelcss, these tactics are not an unmixed evil.
They not only have brought out in strong
contrast the differences in such corporate
management, as reflected in the COMPARE
tive fluctuations of other stocks, but they
have also given the market the test it
needed in checking the unhealthy symp-
toms Of a bull fever, which were only too
plainly developing. The pace had become
too rapid, and only promised exhaustion
and collapse before the race was run. AS
a result Of the present reaction, %inexperi-
enoed operators. intoxicated with success,
havo had time to sober up. The less ven
turesomo buyers. always the large majority,
will secure an opportunity to participate in
the rise to Gomez; while the leaders Of specu-
lat,on will secure time to concentrate
creased following which a moderate decline
will attract. Recognition of these facts
has already temporarily divided the bull
o1ces; go that, Intentionally or otherwise.
recent events will in the end strengthen the
bull movement.
movement than ever. The harvest has now
passed from the range of possibilities into
q certainty. Plenty and profit are already
in the grasp of the farmer. Debts will be
paid, mortgages wiped out, and new enter
prises started on a scale hitherto unknown;
all of which means expansion of business
and increased traffic for railroads. Nor
will the effect be restricted to the United
States. In a measure the impetus started
here will counterfeit the blight of short
crops in Europe. The brunt OF mat calam.
ity must. of course, be borne there; and yet
the rise in American securities has alrendy
revived dropping spirits on the foreign
bourses and helped restore the confidence
destroyed by Argentine and other specula-
tions. Moreover, American prosperity
manufactures, in spite of our higher tariff,
fear Of which has been adding to the de-
preston abroad. The war cloud which has
80 long threatened still remains, and seems
darker than ever. AT the same time nOsGlll-
ties are not likely to begin in the winter;
Russia will not have completed her new ar
mament for two years to come. and the re-
lations between the various powers remain
too indefinite to calculate upon with GER
tainty. Ultimately. war appears inevitable.
At first it may injure American securities,
because they will be the best on which to
realize; but for just the same reason they
will finally be the best to hold; therefore,
no serious or lasting depreciation should
follow our stocks in event of a European
struggle. b,
Gold is coming this way with unexpected
freedom. This lends to lessen the POSSIBLE
question of doubt to bulls of the prudent
sort. The other view Of this gold move
ment is that it causes tirmer money abroad.
where stocks have been carried on American
account, and discourages speculation; to
that extent depriving this market Of I'M
portant foreign support. Still, the imme-
diats course Of the market. however, seems
now more promising again on this side for
the bull side as a reaction from the recent
depression. For the next few eays we look
for an active market. ithgood opportuni-
A. f~r ~ 1aro