The sun. [volume] (New York [N.Y.]) 1833-1916, 1899-07-03
yry YORK CENTRAL EXTENSION.

,l,t tbo New York Central Railroad Company
,,d secured control. on very advantageous
,.-o,s ot tho Boston and Albany Railroad. The
erort not being Immediately contradicted In
e,fal quarters, was generally accepted az
,.,. il, Substance il not in detail, and without
Eating for the formal confirmation OF it. which
Ttl mot come out until Friday afternoon, New
Nrg central stock, which had already risen to
-, uupua statement showing earnings appli-
ll. to dividends Of -, per cent for the year
p.rcpdcd had Il further rise to lao Southern
,ol Western railroad stocks also rose. partly
q, sympathy with New York Central aud partly
,,,,n increased earnings of the roads Kuniors OF
i,.ueuding strikes at first affected unfavorably
,b, city street railroad stocks. hut these were
ca.,utrrar.ed By hints Of the new stock issue.
sf,cc Officially announced, of the Metropolitan
,.u,tAny and by "A revival Of the story OF "a
consolidation of all the street railroads In this
/, rough and in Brooklyn with the Manhattan
lated. Neither the legal proceedings to re-
t,.aln Ne Metropolitan from selling electricity.
i,r the small additional exports OF gold OF
las, saturday nor II temporary squceze in
ri. money. had any r"rceptible effect, and on
~, whole the factors in speculation made for
h ,lcr rrrC3
y f., in the highest degree com ELEMENTARY to
no managers of the New York Central that the
rouncement of their latest move should be
s, fayyrahy accepted as it has been by the
,unic The details 81 the expected aruuisi-
,uu II the Boston and Albany road thus far
,,rl.jsLad are mcagrc but il is almost univcr-
,s,ly a. sumed that not only will there be a
,r,It for the New York Central in the trans
action. hut that 1t will be- Il large one. Justify
H.. It ttss in the price Of Central stock OF q
POINTS, including the dividend payable July II,
,uuyalent To- an increase Of SG.OOO.OuO in the
value 81 It's capital
similar rise. 1t will he remembered oc-
cured in Central stock last winter upon
r,l,nors that tho company. in the same manner
fiat 1t acquired n year ago the control
a. tho Lake Shore and the Michigan Con
,ral roads. was to- acquire control Of the
Chicago and Northwest. the Union Pacific
md tina oregon Short Line. thus putting
tnr Central IN possession Of a continuous
highway from the Atlantic to tho Pacific.
The rlse was from about 100 in January
nearly - in March. making the popular es-
innate Of the increased value Of the entire cap
rtl S15UOU.Ouo This same old rumor has
teau revived by the present announcement
o' the acquisition of the Boston and Albany
road and has been embeished by the add
ton Of an alleged scheme to take in the
Irrhburg road. the Maine Central and the en-
trio New Haven system. which. altogether. IL
carried out. would make tho Central the vir-
t9a master Of nearly the whole railroad bust
ness Of New England.
These acknowledgements Of the New York
Central, If even only part Of them should be
ACCOMPLISHED would necessarily increase its
business enormously. Already. the company's
gross earnings. including those of tho LAX o
Shore and OF the Michigan Central roads
which it really owns. although it keeps a sep
srate account Of their receipts amount to
over S7UOU0. 600 year. and if it acquires all
tho other extensions talked of. they would ex-
C,ad SlG5 600 600. The possibilities Of NJ oft
On this income are enormous. but so are the
possibilities OF loss. The properties from
which tho income would be derived cannot be
acquired without the assumption of an i'm
mense mass OF fixed charges and these being
fixed and the net earnings out OF which they
would he paid being variable, the result
would be- that while somo years might show
large surplus, others might show deficiency
Az present the fixed charges OF the Central
amount to Sl5 400 900 "a year. aud Its net earn
ings for the year Just ended have been S21.-
100000 leaving $500, 600 or thereubouts
turdNiiends on the stock, but If the net earn
!nEs fell only 10 per cent or, say, 81 100. 600
only $500. 900, or 81, per cent. would be left
for the stock. Should the fixed charges be in
creased as they would have to be to consum-
mate the various schemes under discussion.
hy some $50 600 900 or SAC, 900 900 year. the
dividends on tho Central stock would be pro-
rortionately fluctuating and while in some
Years they might be 10 per cent in others
they might be nothing.
Indeed the policy upon which the managers
OF the New York Central are popularly believed
(, have entered. Judged by the results to which
II has already appareutly led, has a pain
ful likeness to that OF the promoters Of the
mammoth industrial com hinations the stocks
OF which, with only partial success have been
? recently offered to the public These indus
trial concerns are VIGOROUSLY organized BY
ACQUIRING. at their full value. a number OF
sunIler concerns giving to the owners of them
bonds or preferred stock TO the entire amount
pIlywed for them and issuing common stock
10 represent the present or expected future
surplus earnings mower Of the combined
pronertios over and above the INTEREST on the
bonds and tina dividends on the nreferreJ
stock In most cases--though IL ia right Ia
saw not in all-the common stock has only
, ,noou,,,i,o yoIua ord solIs IN +bs