The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1899-04-05
SPECULATION IN TRUSTS.

u VERY period of natural prosperity is accom-
panied by speculation fever. Speculation pre-
L. cedes all panics. Prosperity, following extern
sion OF trade increase of consumption, enlargement OF
wages puts profit ard ready money into the hands OF
great numbers of people unaccusomed to great sur
plus OF cash. A large percentage OF them desire 10
use their quickly and newly acquired means so as TO
get large speculative increase IN It, and make them
as rich as anybody. These people are the reckless
buyers OF trust stocks. Their avarlce is unnamed
bv what they read of the profits OF such property
They think every is like every other trust and
each is like the pioneer, the Standard Oh Company
and that everybody can become Rockefeller.
We have had these speculative crazes in California
running to mining stocks When the Comstock deal
WAS on il is known that men had books of stock GER
tifcates printed on mines that existed only IN the
name and vignette, and these when put on the mar
ket were bought as eagerly trust stock IS taken
now The process was like fishing the New
foundland banks, where some clans are thrown into
the water and the hooks put down with bits OF
white cotton cloth tied to them, be eagerly taken
by the fish in their scramble for the real bait 1t is
but little satisfaction be able to say that vast ma
iority OF these formidable trusts whose stock Is now
being gobbled will prove worthless, and that the dan
ger in their existence, now seen by social phil
osophers. is myth for their failure will take from
gained in legitimate trade, and panic will follow
overspecuation in this stock it has always followed
overspeculation in anything.
If trusts did not offer such ready facility for pecu
laton it would seek some other means OF gratifying
the desire Of men to become suddenly rich, and as
the bursting of the trust bubble will disiuSon the
people and take its away from the trust spec
ter perhaps it we'll that speculation has selected that
field.
One thing is sure that if bought trust stock
none would be in existence, and it is also true that If
the prosperity of the country did not distribute the
money into fresh hands there would be to use
in that way 1t should be remembered that the
ganzation of trusts was feature OF the years inn
mediately ensuing upon the panic OF 1893. Money
went out OF circulation when confidence disappeared
and OF the comparatively few trusts heretofore
istence as large percentage OF other business
CARNATIONS went into bankruptcy. Cordage, match
and biscuit trusts and many others, victims OF
panic proving that this form OF corporation bears
charmed life and is subject to the vcisstudes
the ordinary partnership other form OF business
1t is we'll then, for prudent men to look upon the
present activity forming the reflection of
the speculative tendency that always goes hand in
hand with good times and do what may be to make
it less rampant for as its excuses rise the time of
panic and trouble is brought nearer.
Speculation seems inseparable from business.
Whether seek for the object OF its expected gain
George Laws Mississippi scheme, William Paterson's
Scotch Darien Company the Morismulticauus Dutch
bulbs, Hooleys companies, Barney Barnatos kafirs,
railway stocks or trust certificates is all the
1t is the steam pressing in the boiler of business and
sure burst it late, unless the safety valve is
kept in working order 1t should not be forgotten
that speculation in this country is subject to
vicisstudes now than ever. We have assumed po-
sition which puts both legitimate and speculative
business more than at the mercy of our inter
national affairs, and single perturbation therein will
profoundly affect both We need than
sound ideas and practices in business, sound fnan-
cial system and sound currency for we more ex-
posedto emergencies over which we have no control
Therefore let him that standeth take heed lest he fall
The one who is down already can have no change in
his affairs except to get up.
The country needs legislation to protect its credit
its currency its standard of value, more than it
was needed in the late panic. 1t was down then and
could only rise and getting up for the better.
Being now on its feet, it should long as pos
sibe another fall, and minimize its consequences when