The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1899-01-17
A CLOUD I'M THE HORIZON.

Wall street itself is at last becoming
alarmed at the rapidity with which the
business of the country is being concen-
trated in a few hands. In discussing
the effect of this tendency to combina-
ton on business present and future.
Mr.. Henry Clews in his Weekly Finan-
cial Review says:
This feeling is just now accentuated
by the fact that the banks are showing
their estimate of the industrials' by
throwing them out freely as collateral
against loans. without speaking ex-
plicitly as to the motives of the banks
in taking this course, it is easy to see
that they must take cognizance of the
surprising extent to which new COM
bines' are now being created in all parts
of the country. Unless some check is
interposed to that movement, a very
large majority Of our industries must
soon be operating under one or other
modification of the trust principle;
and, indeed, careful estimators calculate
that already fully go per cent of our
manufacturing corporations have placed
themselves under these amalgamations.
1t is hardly surprising that the banks,
especially those doing a stock exchange
business, should pay some attention to
the flooding of Wall street with issues
the true status or value of which it is
generally difficult to ascertain.
THE case would be different were
these largely experimental amalgama-
tions capitalized upon sound principles
assets, and did they possess bona fide
elements of permanency. In most cases,
however, they are greatly OVer-capital-
lied; properties are taken in at exag-
gerated valuations; factories are alb
sorbed with the expectation that they
will be kept idle; good will is capital
lied at f1ctional figures; and profits are
promised which are incompatible with
the maintenance of prices for products
low enough to either protect the COM
hine from competition or to stave off
subtle dissatisfaction and legislative or
legal Intervention.
1T is very apparent also that many
of those committed to ama1gamations
are Influenced by a desire either to real
ize upon the stocks distributed to them
or to make them basis of speculation,
or both. 1t is a serious question with
Wall street as to how far it is consist
ent with the safety of its large inter
ests and with it's reputation as a great
financial market to become instr1-
mental in the distribution of thousands
of millions of securities resting upon
such a basis as these industrials' for
the most part possess. 1t would seem
anevita BILE that these corporations must
at no very distant day, become a burn
ing question in politics: and, in that
event, what would be the situation of
investment interests, If Wall street were
found flooded with these issues? Is it
not better to face this question now
while protection is possible than to ig-
more it until the movement has passed
beyond control? The decentralization to
WniCn the STOCK market Is already con-
stantly exposed from these influences is
sufficient, without inviting further ex-
posture to this demoralizing tendency.
There can be no doubt that the rapid
increase now in process in these indus
trial amalgamations is having its effect
upon the otherwise hopeful influences
that are enhancing the value of Iegiti-
mate investments. The surprising ma G.
nitude of these new creations causes
conservative men to halt and ask-what
is to be the outcome of the wave of
speculative organization that is spread
ing over our industrial system? Their
eye is upon this cloud in the horizon,
and not few cautious men are dis
posed to stand still until they are more
satisfied with this industrial outlook. -