The times., 1901-03-25
STOCK MARKET COMMENT
W0nderment Over Continuance of
the Advance Without Recession.

Belief That n Reaction IL Likely In
the Nenr Futurc-Thc Bull Move
mcnt Not Over. HowcVer-Prosper
fly of the Railways UnesHmPIed.
NEW YORK. March 24-The recession
more or less important that many careful
Wall Street people have been looking Tor
during the past week, has not yet ap-
pcared. Shrewd traders. who have been
expecting a reaction went home yester-
dav marveling at the power of the opera
tors. but still confident that the upward
swing can continue but a short time
longer without leading to a sharp set
back. who ever watched the tremendous
sweep of the market last week must
have been convinced that the advance IN
many stocks of from two to five points
a.dav was unnatural; that it was part of
A broad scheme of manipulation. The
sueculation has been of a kind that
forced the outsider into the position of
buver He has had a multitude OF
chances for large gains so long as he ac-
cepted the general trend. That he should
be allowed to sell to advantage was not
part Of the original scheme. This condl-
tion was apparent time and again ID
those issues under manipulation whefe
purchases Of $500 shares would advance
quotations two points, but the actual
sale of SOC shares demoralized their mar
ket When the reaction comes IL Is llAe-
" to extend several points and 10 con
tinue for a week or more Conservative
people are expecting H. anu VIII NON
hurt
Put despite this looked for halt in the
advance the best opinion of the market,
looked at broadly, is that the boom is not
vet over. that it is likely to continue lot
months 10 come. The recession is slhply
an incident. due to technical conditions.
Conservative brokers who have made
careful study of the railroad situation ana
the future of the best class of railroad
securities are advising their clients 10
sell their low interest bearing bonds ana
invest in high-class stocks on recessloils
St Paul. Great Northern, Burlington
Rock Island. Northern and Union racine
and the others of the great group VI
granger roads whose earnings are reHeCt-
ing the prosperity which prevails IN the
Middle West have been faVorltles with
the Investors Even at the high prices
which these stocks have reached they are
showing much larger returns to their
builders than are the better Grass oA
bonds and the continuity OF their diNl-
dend returns is reasonably assured Tor
many years to come.
OF course. the roads are to great ex-
tent dependent upon good crops for their
prosperity. but the same is true of near
" every other class Of business in the
country. Prosperity, as one OF the
Sages Of Wall Street has said, is inter-
aliv dug out of the earth The grangerS,
however. are less dependent upon the
actual movements of grain for their earn
ings than ever before. The commercial
growth Of the extreme West has greatly
diversified the character of traffic over
these lines. Wheat forms less than
per cent Of the aggregate tonnage of the
ffhfrgUn Milwaukee,
road.
The railroads. however, have taken to
heart in recent years the lesson Of the
lean kline and are laying up large sur
pluses against the years of adversely.
There is scarcely one of the great grang-
ers that has distributed among its stock
holders anything like all its net earnings
applicable in dividends.
The most important bull point of the
week was the announcement by j. p.
Morgan x Co. that there had been de-
posted from 81 to IS per cent of the
preferred stock and from % to 90 per
cent of the common stock of the steel
companies which have been included in
the United States Steel Corporation
This announcement took Wall Street
somewhat by surprise, there has been
some doubt as to the success of the deal
The fact that no obstacle that IS worth
considering now stands in the way OF
the consummation of Mr.. Morgans great
undertaking has inspired greater conf
deuce than existed before in the financial
outlook Il is believed that the interests !
behind the deal are committed to a sup
port Of the market and TO a sustained !
effort 10 keep money rates at the normal /
for at least a year and perhaps longer /
When IL is remembered that two Of New /
Gork's greatest banks and half dozen |
OF Its leading trust companies are mem /
bers OF the syndicate, there is little doubt /
of the ability of this group Of financial /
interests to prevent OEeriufatiOn of in 4
terest rates or to restrain the agencies of !
disQuietude which may assert themselves /
from time 10 time. The power OF these /
banks was shown during the panic Of a /
year ago by the National City Bank |
when. for several weeks. the rates for /
call money were absolutely fixed by this
institution, without regard 10 the laws Of !
supply and demand. Combined with the |
Morgan banks and the trust companies
this money combination is apparently an /
irresistible force. and as long as il has
an interest IN doing so its influence Will |
be eNerted for good.
There is much amusement In Chica go /
according TO a gentleman who has fust
come from that city. over the fine bar 4
gain Judge Moore has driven with the 1
United States Steel Corporation. II is /
said that Judge Moore's friends were !
greatly surprised at the good terms he /
was able to make with Mr.. Morgan. The /
Moore interests looked upon the forma- /
tion Of the great combination with con- |
siderable alarm. They knew that they /
could not safely remain outside Of the /
fold and they felt great apprehension |
lest they should be given q much lower !
rate of percentage than the other steel |
companies. 1t is said that they would /
have been abUndantly satisfied TO have (
been taken in at par, and that they ac-
tually expected much lower rating. |
The art OF blufiing is an accomplishment !
with which business men from Chicago /
are not totally unfamiliar, and Judge |
Moore resorted to the eXpedient. To his |
intense surprise and great satisfaction |
he was successful and now there is a I
broad smile from the Ferris Wheel TO |
end OF the drainage canal