The herald., 1895-10-18
TIE Kaffir Timing Stocks


For sons weeks or months past the
market reports have been full Of refer
ences to Kaffirs or which spectators on
European boursas have gone crazy. Just
what Kaffi RS were or how many of them
existed, the speculative world has
not known. Interesting in this connec-
ton is the following extract from Henry
Clews' late review OF financial m alters:
The kaffi4s excitement is ono of the
widest outbreaks of speculative mania
experienced within the present century.
1t began with the remarkable success of
a few ventures connected with the new
gold discoveries in South Africa. This
led to the creation of syndicates without
end, and to the formation of companies
for exploration and for dealing in the
new issues of stocks and for the boldest
banking undertakings. 1t is impossible to
state in exact figures the extent to which
this Juror of speculation has run, for of
large amount of the ventures no in
formation is obtainable But so far as re-
spects the com panies which give more
or less publicity to their affairs, there are
some twenty-five which nave been paying
dividends with some regularity, averaa-
ing about 90 per cent and ranging in
some cases as high as 65, rs, 80 and even
loo per cent.
The legal capitalization of thes, twenty
five companies is about $22. 500, 900; while
their present market price represents
1872, 800, 900, the dividends averaging
about 8 per cent on the current price. Be-
sides these there are 1873 com panies re-
porting on the London market which are
paying no dividends and pass muster on
reiterated promises that are never fulfill.
ed. These non-dividend paying mines
have an aggregate capital of $3.50, 00n, 900.
Their market value last month was $685.,
600, 900, or exactly four times the par value
IF ~ sh m n n ~
com panies above referred to, there are
thirty-One other various organizations
which are concerned in land, banking.
real estate, promoting, exploring, etc
These concerns have total capital of
$40, 600. 900, consisting principally Of one
pound shares; and, in this case again,
the market value is exactly four times the
par capitalization. being S315. 900, 900. Ex-
Guiding from the reckoning the twenty
five dividend-paying mining stocks, we
have first, total OF lG4 enterprises, rep
resenting either no value, capitalized at
$2lS. 900, 600; and, second, this compera-
lively worthless scrip worked up to a
fictitious market valuation of $3.50. 000.-
0G0. France has also its scheme of like
quality and similarly inflated, but we
have no means OF knowing their exac;
extent
This is the measure of the mass of ex-
plosive elements that now underlies the
financial markets of London and Paris.
This is the quality of the investment ma
terial that those great centers are sloat-
ing over while contemptuously turning
up their noses at American securities.
1t is not surprising that the sober part OF
London and Paris should begin to feel
uneasy. That all this must enc in a
terrific explosion there is no possibility
of question. The symptoms are already
ominous. The stage of dlstrust has been
reached, and this next stage must be
realizing; and when tEat comes the col
lapse will be instantaneous, and hundreds
of millions of market value may be wiped
out in a few hours or days.
The interest of the New York market
in this impending explosion lies in this:
That as the collapse would affect the
whole investment market, our securities
held IN England would suffer In SYM
patty, and might consequently be re-
tuned on this market. 1t is easy, how
ever, to overestlTate the extent of that
danger The class who have participated
in this craze are.not likely TO be the same
as those who invest in our securities or
speculate in them. The latter class
might temporarily realize; but the de-
mand would soon return. and the specu-
lative interest in London would then CEN
ter upon Americans, as affording the
most attraction to the conservatism in
speculation which would then be the Or
6ar of dav