St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1893-08-17
THE N. P. TROUBLES.
MAHY REASONS FOR THE APPOINT
MENT or A. RECEIVER.
INABILITY To cARRy LOANS.
Heavy Drop in the Company's
Consols Made 1t Impossible to
Raise Margins of Loans Soon
Due-Great Northern's Pay
Roll Reduction-General Rail
road Paralysis.

NEW YORK. Aug. 16.-Little news
was obtainable about the affairs of the.
Northern Pacific Railroad company. At
IL O'Clock the lawyers of the receivers
and the company were in consultation
at the office of the latter. The applica-
ton for receivers, it is learned, has
been granted in st. Paul, Portland.
Helena, Olympia and Milwaukee, as
we'll as in this city. A representative
of the company said today that in dis
cussing the causes Of the appointment
of receivers there WAS nothing to add to
the statement that they were in the
falling off in the receipts of the road
and its consequent inability to pay in
terest about to fail due. The floating
debt mad nothing whatever to do with
the application to the courts.
Another person, however, who said
he was familiar with the company's af-
fairs, said that. while it was true that
the falling off in the receipts was i'll
directly the cause of the receivership.
yet thei Immediate cause was the drop
of 5 per cent in the quoted price of the
%company's conSols. and its inability TO
respond to the call for more margins on
one of its loans. which was not due un-
iii Sept. l. The failure. however, to
put up the required margin, made the
loan at once due and payable. There
were two of these loans. One was ow-
ing to Speyer & Co. That had been ad-
justcd. The other one, which exceeded
$1,000. 600, was owing to KuhD, Loeb 81
Co. They called that loan before the
appointment of
The Receivers.
They could not sell the collateral held
for the loan(about $4,000, 900 par value),
but If they did it would cause a tremen-
dous break in the price of them.
At the Office of Kuhn, Loeb & Co., it
was said by Mr.. Schiff, of that firm, that
the $1,000. 600 Northern Pacific loan,
which had not been included in the sub
Scriptlon, bad been arranged, but he de-
clined to give the reporter any particu-
lars or state who held the collateral, or
whether they would be put on the.
market.
Charles G. Wetmore. the president of
the North American company, says
there Is no truth in the report of a re-
ceiverShlp for his company. 1t was
thought in some quarters that the EN-
barrassment of the Northern Paeif c
company would carry down the North
American, whose assets consist mainly
of Northern Pacific securities.
The Post says: Coming as yester-
days June statement for the Union
Pacific did, along with the confession of
the Northern Pacitic's insolvency, with
the reduction of nearly so per cent in
the Great Northern's monthly pay roll,
and with a steady falling off in current
gross receipts of other continental
roads, the question of the cause of such
traffic losses becomes of paramount i'm
portance.
The Trouble
IS clearly not that of a single district, as
the u Mon Pacific figures prove. If the
decrease or So per cent in the Den yer &
Gulf divisions earnings be attributed to
Colorado's individual collapse, some
other reason must be had for the de-
crease of so per cent in the return of the
Oregon Navigation, far to the northwest,
or for the still heavier falling off in
those of the Union Pacific smaller lines,
confined to Kansas and Nebraska.
The total shrinkage covers an
enormous and varied area and re-
fleets a paralysis of transportation from
the granger states to the Pacific ocean.
The immediate cause of this blockade
will not escape observers of the market
for money and for interior exchange.
No doubt the people of the West are
buying less Eastern merchandise than
in 1892, put this again is largely because
they cannot command the bank facifi-
ties to send their own merchandise to
market. EurOpe's sudden and heavy
purchases of grain have been supplied
from the city elevators, whose stock of
wheat has fallen $4,000. O00 bushels since
ApriPs opening, but the new grain and
the new Western produce of every kind
as far as the Pacific is in the hands of
its producers. 1t Is neither worthless
nor s~uperfuous, and each Successive
draft upon supplies in sight brings
closer the time when consumers will
peremptorily need the produce from
first hands.