New-York tribune., 1901-01-06
fnanriaL
The Financial World.

ter Is looked for at any moment. In last weeks
article it was pointed ont the deal which
had been behind the immense buying OF the
Northern Pacific stocks had reached the staga
where the ST. Paul ha6 come to the 'front.' To
outsiders it was doubtful then whether the new
arrangements would take the form of lease. or
simply of control by joint ownership Of stock
The latter seemed TO be the probable, as
being simpler; less liable to interference by
speculative lawsuits or Legislative strikes How
ever, it turns out that the plan contemplated a
lease. The terms of this stiu Official
secret; but it {. known that powerful interests
in the ST. Paul would not consent to a lease at
per cent. The rumors IN circulation yester-
day were that IL would be 8 per cent for two
years and z per cent thereafter, with division
of treasury assets, the same agreed to
in the purchase Of the Pennsylvania Coal stock.
The execution of this lease Will mark the dis
appearance OF ST. Paul stock from the trading
list. 1t viii go off it just other stocks have
gone, when they have become guaranteed
curitiss: such as Fort Wayne stock when tho
Pennsylvania bought the roads Morris & Es-
sex. when taken by the Lackawaunas
Lake Shore-the latter stock being converted
into bond This disappearance viii not bs
effected right away. 1t will take some time for
the guaranteed stock to find Judgement in the
boxes Of investors. Probably three to four
months will be required. during which time
transactions in the stock will gradually di-nin-
ish. until the time comes when only occasional
lots of st. Paul will be on the tape.
AS to the price the stock Will settle around
We cannot know that until the terms OF the lease
public property. But may get some idea
from a remark credited 70 Mr.. Morgan ten days
or so ago, when some one ventured the sugges-
ton that ST Paul looked rather high. '.Not
HIGH 4 bo said
Paul is to be reckoned hereafter as per cent
guaranteed stock IL will settle somewhere be-
tween 100 and $50 The preliminary violent
fluctuations, however. not yet over. In
respect to the security OF the guarantee. there
Is no question. Indeed ST. Paul could guaran--
tee ITSELF assuming continuance OF ordinary
good management
This new deal fs the greatest which has taken
place IN Wall Street since the famous West
Shore deal IN 1855; and is bigger than that AS
Mr. Morgan made that In conjunction with
William III. Vanderbilt; so he has made this IN
conjunction with Mr. Hill The ST. PauI-Pacifo
Ine If it may be so called VIII extend from Chi
cago TO the Pacific coast: and It's eastern end
will be the Erie Enough business VIII be
thrown over the Erie lines TO make earnings
which viii put up Erie securities 20 figures con-
siderably higher than those they now
quoted at
Looked AZ az a whole this new consolidation
Is simply the latest in the line Of that unihca-
ton Of routes OF transportation which started
with Commodore Vanderbilt. when he sconsolt-
dated the Hudson River road with the New
York Central. That was nearly forty years
ago. and for those days # was a gigantic COM
binaiion, and engaged the attention OF the whole
country After that came the requirement OF
the Lake Shore. and the making Of a continuous
line from New York 70 Chicago. That was an
other great feat. The process OF consolidation
has since been going on between tie Mississippi
River and the Pacific The ST. Paul-Pacihc line.
working In close connection with the Erie. will
make an ocean to ocean line. The Vanderbilc
transcontinentaI line Is over the Northwestern
and Union Pacific, reaching the coast by the
Oregon Short line. The Pennsylvania Is con-
sidered TO work mainly through the Atchison-
All these combinations are in the interest OF
economy OF operation They have been forced
upon the great railroad managers and hnancters
by two causes: first, the constantly pressing de-
rnand OF the public for more speedy coEnmunica-
ton: second, the tendency OF railroad rates 20
move downward If. for example the Erie
could get the same rates to-day as il got twenty
years ago, and did the work ar to-day's cost oc
operation. the company could probably pay
about ten per cent on its common stock
AS 1t is the new arrangements make It plain
cards for the immediate future
Mr.. Morgan's other operation. the purchase
of the Jersey Central for the Reading Company,
is IN the interest of harmony in the anthracsts
coal trade. All the anthracite producers and
carriers are now so thoroughly combined. that
the trade may be said 70 be in the hands OF halt
a dozen men. The Readins-Jersey line and the
Lehigh Valley. the Pennsylvania Coal Company.
the Lackawanna, the Delaware & Hudson and
the Ontario and Western may be said TO bs
Jointly owned in the interest OF the Eastern
trunk lines: for when the controlling ownership
Is traced out. IT will be found to centre close To-
the controlling powers In these great systems
1t has been a long work TO secure this; but
done it is now. It means that coal Will be sold
at really uniform rates. and not at rates which
are uniform only on the monthly circulars. vs.,
see the establishment OF that central selling
agency which has been so many years talked
about: but which never could be worked out,
because OF diverse ownership and conftcttna.
interests.
We may expect to great speculation IN
the Reading issues 1t has looked as II some
thing of the sort was coming for soma uttlz.
time. Reference was made here last week to-
the significant talk on Reading; that sort OF
talk it was noted. which often preceded an i'm
portant movement IN the securities which wera
rne subject OF It Probably the negotia tfons for
the purchase OF the Jersey Central were then
reaching a conclusion. They have been pending
for considerable period. Jersey has been
hitched UP with the Reading before as IT Is
a continuation OF that SYSTEM but be-
cause of faultiness in the joining, it has broken
away. This time IT is Joined to stay. Cash pur-