New-York tribune., 1902-08-17
finanridl.
The Financial World.

reserves running very close TO the 25 per
cent legal line. By yesterdays statement the
surplus is reduced to about S1,OOO.0O0 only.
Probably the majority of the banks have
loaned all the money they care TO lend on time.
and the balance of loanabe funds they expect
to make high rates on later. when call money is
very likely to command high fgures-uot for
any length of time but long enough to be in
convenient to borrowers The per cent rate
which was made Friday mainly due
shifting of accounts connected with payments
on the Oregon Short Line bond account; but IL
scared the traders and gave the stock market
a sudden. though temporary. chill. With q crop
movement in full swing, however later on. We
may expect days when per cent will be the
minimum figure call money.
The speculative movements of the past week
classed themselves in the main as operations Of
the Gould party in of stocks. and the
Gates party in another set; while an advance In
Southern Pacific was due to a third. An event
in connection with this stock was the informal.
but authoritative. announcement of the adop-
ton by the Board of Directors of the new hnan-
cial scheme for the company. Some weeks ago
it stated in this column. that while the
Oregon Short Line bond issue was the last OF
the financial schemes contemplated in respect
To the Union Pacific Company, yet later that the
Southern Pacific would require some financing
Details at present wanting; but IL is said
that the issue will be certificates Of debt,
being sort Of company note; that they will be
! per cents. and be both convertible and re-
deemable; the latter above par and the former
at some figure between 80 and 90
While the total authorized issue is one hun
dred millions, the present actual issue will be
twenty-five; which is probably all that ever
will Feed to be issued. 1t is well known that
there is a majority and minority party in the
Southern Pacific; the majority representing the
Union Pacific interests which bought the blocks
of stock from the Speyers and the Huntington
heirs: and the minority. a strong combination
under Mr.. Keene's leadership, who had been
investing heavily in Southern Pacific stock be-
fore the Union Pacific people purchased the
blocks of stock referred 10. There has been some
feeling between these two parties The minority
have contended that the stockholders had a
right to some division Of the earnings OF the
road instead Of everything being appropriated
to permanent improvements The majority
have contended that the interests Of all the
stockholders would be best subserved by build
ing up the property and deferring dividend pay
ments to some time in the future
The action OF the directors Of the company
now, In providing for this capital issue, seems to
be satisfactory both parties 1t may be as
suned that the directors were satisfied TO adopt
this policy; and the other people say that 1t IS
entirely satisfactory to them They interpret
1t as meaning that all the earnings of the road
are not to be absorbed in improvements which
are justly chargeable to capital account. on
their part IT may be that the directors have
come to the conclusion it will be mora eco7omi-
cal to do all the rebuilding etc. III as snort 4
time as possible. and so raise the money in
lump sum instead of waiting a longer time TO
take 1t all from earnings. Anyway. the thins;
seems to have the approval OF both majority
and minority holders
The announcement of the Louisville plan .
understood to await the return of Mr.. Morgan.
who should be here by the middle of the week.
The stock has made record price in the past
day or two. rising above 152 q per cent
guarantee on it is as said last week. spoken OF
as a surety. The company could probably do
it's own guaranteeing at that rate. provided.
harmonious relations Of a permanent character
were established with other large Southern sys-
TENS This of course. is expected TO be part Of
the new plan. AS . per cent stock Louisville.
might go higher. and perhaps will; but it is
we'll to remember there are some very large
blocks of it held speculativeIy; not for the :
per cent dividend. but for the market which
such a dividend would make for the stock: and
these will have to be absorbed by investors be
fore Louisville maintains itself naturally in the
market at a level corresponding to { per cent
security.
The Gould party is getting to be talked about
more and more in the Street. 1t is understood
to mean the younger Goulds. The speculation
in Missouri Pacific in Texas Pacific. in St Louis
Southwestern and in Manhattan. is all credited
To them-yvith what degree of truth it Is not
easy to say Probably it is true credit. Texas
Pacific has been up to its May price OF last
wear from which it suffered something like
collapse: Missouri Pacific has shown signs OF
realizing-most likely temporary turn only. as
the outlook for the road for this fiscal year Is
excellent The St Louis Southwestern issues
have been bought straight up the preferred
Yesterday closing at the top price of III There
is still the belief that the buying OF this stock
Is connected with the Eastern Illinois and St
Touis San Francisco combination: for the St
Iouis Southwestern road is the southern con-
nection of the Eastern Illinois "a connection
MANNED and carried out by Governor Flower
shortly before he died): and would naturally
form a connecting link between the Missouri
Pacific St Louis San Francisco and Eastern
Illinois systems.
The anthracite coal stocks have not been
speciaIly depressed by the strike. but the trad
ing in them has been killed. We getting In the
latest reports of earnings strong realization
of the losses these Industrial wars involve The
Ontario &. Western for the month OF July Is
cut down three-quarters; the Jersey Central
about oue-third; the Lackawanna must be the
same and the Delaware & Hudson and Read
ing Also In proportion any road depends
unon hard coal traffic, is the proportion OF IT'S
losses from this protracted strike. The conso-
ratior is that according TO the severity OF the
wgr is the duration OF the succeeding peace
which is equally true of the mining regions OF
South Africa. A decrease in the July earnilSs