Arizona republican. [volume] (Phoenix, Ariz.) 1890-1930, 1899-08-30
PHOENIX. AUGUST 80. 1899.
THE CORPORATION CRAZE.

The trust craze has almcst subsidized,
and while the Incorporation of new
conpanies. with capitals ranging from
five thousand to one million or more
of dollars goes on the announcemer.
of trusts by the combining of concerns
in the same line of business is no long-
CT a regular topic of news.
The trust business has been over
worked already, the squirt Of last
spring having revealed to investors
that the promoters were more % be
benefited than those who bought stock
Some of the trust stocks have gone
begging and several Of these cOmbina-
tfons have never gone further than The
agreement to combine. The supply OF
gull,ble folk was soon consumed and
those who have not gone into the nu-
merous schemes are waiting to see how
the others are to make out. Taking
the charter capitals Of the great COM
binations they foot up to fabulous
sum and far in excess Of any reason
able prospect for a substantial return
for money invested. OF course the
stated capitals do not stand for che
actual money in hand. The real value
of the stock paid for in these giant
concerns is far below the figures an
nounced. For instance a trust con-
Germ buys a plant worth one hundred
thousand dollars and Immediately adds
it to it's assets On a basis Of half a mill
lion of dollars. The value is not there.
To earn Interest on the full capital
named would he almost Impossible in
many instances and the eventual Losers
will be the outsiders who bought stock
or who sold their properties for cash
cor its equivalent" which later means
stock that will never realize anything.
The promoters have been making a
harvest Of duoats and some one has
to pay the bills for Services" A con-
sentative sentiment suddenly took pos
session of men with money to invest.
They are not disposed to come for
ward ard bite at the numerous pros
pectuses that offer inducements SAVIOR
ing of fairyland The probabilities are
that most OF che highly capitalized
concerns will gradually disappear from
sight, and the deludsd buyers of stock
will have to sit down and reflect in
lieu of receipting for dividends and in
terest.
1t is we'll that the craze was checked
TO a certain extent, thereby lessening
the dangers of a general collapse IN
business. There is enough legitimate |
business TO take up the available |
money in hand, without going into
wildcat schemes OF the most visionary |
kind. AS to the smaller and individual
companies being incorporated from |
day to day .shere is every expectation |
that one7half or three-fourths of them |
will never get ibsycnd the first stages
of paying for charter and having |
some blanks and letter heads printed |
The smaller the capital the greater the |
prospect of concern going into actual |
operation. There is not so much dan
ger of general tumble in stock con-
Germs as there was several months ago. |
The people familiar with financial af-
fairs have kept their eyes open and |
they have suddenly acquired a more
conservative spir.G and stock must be
of the best quality before it is taken
up. The worst OF the craze is over and
the adjustment we hope will be soon
and safely accomplished. In a year
or two n major portion Of the wonder
full concerns with millions of capital
on paper VIII be almost forgotten save
by those who dropped their money in
to the hats of the promoters or who
sold their plants for cash or its equiv
alent."