Daily inter mountain. [volume] (Butte, Mont.) 1881-1901, 1899-11-18
PRESIDENT HADLEY'S DISCUSSION
OF TRUSTS.

Harper's Weekly: By far the most il
luminationg and pregnant article Of all
the recent discussions Of trusts is that
Of President Hadley in Schibner's Maya
zine for November. Trusts are not the
bugbear of DR.. Hadley, as they seem to
be of the politician who is striving after
the votes of the half-informed constitu-
ency. They are to the trained thinker
the natural product Of the time, the ex-
preston Of an economic and financial
tendency, whose benefits will be retain
ed, and whose evils will probably cure
themselves. The effort to suppress this
tendency by legislation must fail, for so
far as combinations of capital are bene-
fetal they will command the supper of
the community where they exist, and, if
necessary, hostile legislation will be de-
fled, while effort at such legislation will
be bought off, after the manner in which
! corporations nave for a long time pro-
tected their interest. against legislative
strikes.
DIR. Hadley believes that the combina-
ton of capital into trusts, or by the union
of several corporations into one, has been
mainly accomplished; that is, that we
shall never see again such vast transfor-
nations of many old organisms into sin
gle great corporations, or the founding
of SO many new gigantic enterprises, as
were worked out in 1898 and in the first
formed had a capital of 5000, 900, 900. In
the first half of 1899 the capital of the
new CORPORATIONS amounted to the as
founding sum of 5000, 000, 900. A large
part of thisw was old capital put into new
form. Old corporations CHARTERED, of
course, but the capital invested in them
made a comparatively small part Of the
grand total of So, 900, 600, 900.
According to DR.. Hadley, whose view
is Undoubtedly correct, this movement
of consolidation and combination has
seen it's most rapid development. This
is the period of speculation in indus
trials" Like most first steps in cor
porate development, it is a speculative
movement. What we call "industrials'-
that is, the stocks representing capital
engaged in production-are now on the
market rivalling the stocks representing
capital invested in the business of trans
portation. 1t is very likely that we are
to continue to see these industrial"
pass through a phase of history which
seems to be common to the early lays
of all listed securities-that is, of all Sc
%curities dealt in on the stock exchange,
:, and which are of. necessity the subject
of speculation before they offer strong
l temptation to the investor. The bust
ness Of production has heretofore been
a local enterprise. dependent usually up
on the ability of a single man or OF a
, small group of men. 1t did not appeal
either to investors or to spectators, be-
: cause, as a rule, the opportunities and
l possibilities of any given corporation
were not known to them, and because
Ii NEOA
, single life or a few lives. The trust or
combination enlarges the field and scope
: of productive enterprise UNNECESSARILY
and brings it within the law of the stock
market. When it becomes a national
l corporation it's operations come within
: the field of view of those who have money
, for investment and speculation.
The new trust securities having become
+, marketable by becoming national. the
first attraction is in their market value.
DR.. Hadley says that there is a fashion
in Investments, as in everything else
Recently the fashion has been indus
trials Men buy the stock of the hour
because other men are buying 1t. and
we see therefore the manipulation of the
stock for the increase in its market value,
and we see also, and will probably con-
/, tinue to see for some time to come the
. rigging Of the market by those who
| are 'i~nside"-that is, by boards of di-
t %rectors.
: Eventually. however. there will be a
:, change, such as we have seen in the
, business of railroad management: and
this point is illustrated by an agreement
l which one of the daily newspapers re-
ports to have been made by the great
railroad mbin spoken
=, of not as trusts, but as systeMs-lntend-
ed apparently not for the pooling OF earn
: ings or for the increasing of rates. but
for the reform of the managsment OF
the business of railroads. with a View
l to conducting 1t on the principles which