Evening star. [volume] (Washington, D.C.) 1854-1972, 1901-01-19
THE FUTURE OF RAILWAYS
DISCUSSION of STOCKS AND CON-
CENTRaTIoN OF CAPITAL.
Growth in Traffic and In Revenues
During Recent Years-Xiews
of Banker.

Some remarks a. few days ago by James
j. Hill. leading director of the Baltimore
and Ohio Railroad Company. In reference
to the future of the railway interests of
this country have attracted wide atten-
ton and are being commented upon by
bankers and railway men generally.
| Said Mr. Hill: Concentration of capital
and management is becoming imperative
| The consolidation of railroads by one
| method or another is the policy of the
| times in railroads, as we'll as industries
The largest and longest haul of freight Is
the most profitable because the proportion
ate expense is minimized. Everything must
/ necessarily be of large proportions-the
ships that carry the freight to other lands
| the cars the locomotives, the reanpeo,
track and bridges must be of the most
enduring kind TO meet the requirements
of the traffic. Such changes mean econ
| omy in operation. and this is the funoa-
mental principle of the transportation
1 problem
Referring to the foregoing, Baltimore
| banker who is especially well posted on
! railway matters In general said to star
| reporter: 1.-The railroads OF the couhtr!
are on a sound footing. A large number OF
| them have been reorganized. ana tneif
securities readjusted to safe basis: cal
! culated upon the ascertained minimum
earnings of the property ihsre f hae, De sueh
| broad foundation of actual values unuer
| railroad securities as that existing at tne
| present day The growth in traffic ana IN
| revenues during recent years mas pee"
| little short of marvellous
Progress Noted.
.eThe wonderful progress made by our
sreat TRANSPORTATION lines obviously reflects
the activity and expansion that nave oc-
Cured in all lines of industry and are
| of hn AGRICULTURAL
and business interests of the entire coun-
NV, The tremendous additions to the ma
! tiou,s wealth contributed by the unprece-
dented increase of gold output. bountlfui
cereal and cotton crops, phenomenal iron
and coal development, record-preaKlhs eA-
ports of manufactures, etc, IN recent se<'t'
are well-knoWn facts. T.,
| "Developments have clearly revealed the
| purpose and justification for the accunuid
| ton of dominant interests IN railroad anu
| financial circles, of immense quantities OF
| stocks during the summer and fall, ana
| more especially during the closing months
! of the year, with its accompaniment OF
record breaking advances. The publc Ill a
| general way. understands that the rise IS
due primarily to the country's prosperity
| and that the first great impulse was given
| the market by the decisive defeat OF Bryan
| ism at the polls in November and the con-
| seuuent renewal of confidence and the I'M
locking and outpouring of capital and
| credits.
",rhe improvement in values more recent
| " has been as Is well known, the result or
| the partial maturing and carrying our OF
| vast schemes of railroad combinations, con-
! soIidatons, alliances, leases purchases or
| ccntrol-meaning, in a word, the concen-
| tration of ownership, the Inauguration oI
| capable and economical ADMINISTRATOR,
| promising better service to the public and
| larger returns to investors. These plans
| have been long in contemplation and in get
ting under way, and 1t will require stu
| more time to mature and finally perfect
| them. They are the necessary outcome or
the conditions largely produced by lack of
proper regulation and legislation to permit
! railroads to pool their earnings or other
wise combine for their own protection The
| application of the community of ownership
principle assures stability of rates and pre-
vents ruinous competition.
Acquisition of stock.
How far this work of consolidation and
alliance has proceeded may be grasped by
| the reported acquisition of big blocks OF
stock in various railroads and producing
| companies by the leading trunk lines and
the powerful banking interests associa ed
| with them. 1t will be recalled that the
| Pennsylvania first acquired S20,0O0.o00 OF
| Baltimore and Ohio preferred stock, fol-
| lowing this up with similar large purchases
of Chesa peake and Ohio, Norfolk and West
ern, Western New York and Pennsylvania
| the Erie and Western Transportation Com
| pany, Long Island, etc. Inc New 10TH
| Central also acquired large amounts OF
! Chesapeake and Ohio, Big Four. Lake Erie
| and Western, Reading, etc.
| '"rhen there is the acquisition by the Erie
| read of the Pennsylvania Coal Company, al
tremendous cost The Reading has ac-
| Quired control of the Jersey Central, While
| with regard to the reputed heavy buying OF
St. Paul by the Great Northern and the
| Northern Pacific, the rumored buying Of
| Delaware and Hudson. Lehigh Valley, New
| York and Ontario and Western by other
interests. the public has been duly in
| formed.
IAN investigation will show that many
| railway stocks have advanced during The
past six months from $40 to $40 pei
| share. 1t cannot be questioned that the
| status Of many properties has been COM
| pletely changed through the developments
| which have recently taken place-changed
for the better-and. 1t Is thought, perma-
| nently. But this does not mean that the
stocks of all the companies affected will
| be Immediately placed upon a dividend
paying basis. although it may be figured
such thing is possible either now al
| some future date.
| THE Southern railway-the great system
of southern roads-is reporting large adj
ditions to the earnings shown for the late
| year. and with the development and growth
of the section which it serves its reve-
nues will, it is believed. continue to in
| crease"