New-York tribune., 1902-01-19
(lunnrlnl.
The Financial World.

! liquidated by some one; who. of course. wa,
, promptly assisted in selling by the room trad
/ ers. After this selling was over. the markef
! recovered to some extent led by the coal stocks
| and stimulated by the expectation Of goOc
! bank statement. Such a statement appeared fr
| due course yesterday: a surplus reserve in
creased by some six millions more. bringing
! the total UP TO nineteen millions and givins
/ promise of easy money. Whe-eupon the market
| which had been quite strong. fell away; indi.
eating that people had stocks sell who avaiIed
| themselves of the opportunity which the state
| ment afforded.
| Whenever the market rallies the coal stocks
may be expected to be well in the lead. There
| has never been in the history of the anthracite
trade conditions like those which now exist
Firstly. there is a demand for coal so large anc
so urgent that the retail dealers have difficulty
in getting full supplies from the companies
Second. the consolidation of interests in the
four five companies which control the anthra-
cite output has become closer than ever was
known before. And third, this union is so close
that not only are the wholesale prices Of the
various sorts Of coal fixed and uniform. but the
companies are also able to dictate 70 the re-
taers the prices at which they. the retailers
shall sell. When the latter buy their boatloads
they have maximum price fixed FOR them at
which they shall retail The penalty for re-
fusal is-nO more coal.
This is why. with a raising cf wholesale prices
of anthracite. there has not been a correspond
ing advance in retail prices. There is no end of
kicking by the middlemen, who complain they
are reduced to mere agents Of the companies:
but kicking is no good. Sell at the prices given
you. say the companies. YOU don't get any
coal to sell 1t is estimated that the companies
! VIII net this year about ~ certs per ton more
than last; which will be about - millions net
owns the Jersey Central will get the bulk OF
this. through its own percentage with that of
the Jersey added II is upon this state OF facts
| that the Reading issues go higher than before
after every reaction.
Next to coal. the condition Of the steel trade
! is the most satisfactory. 1t Is asserted that Mr.
Morgan stands so steadfastIy on the bull side
because of this. The great steel company has
orders on its books for the whole OF this year;
whereas at the opening of last wear the orders
were for only two to three months. We know
| from the experience Of it's customers that the
| question is simply how turn out the work
wanted in the time it is asked for. Steel pre-
ferred is gradually going into investors boxes;
| and. as said here last week. it is much TO the
| advantage Of investors that the price should
| remain comparatively low: because. bought az
| these prices. the buyer could afford IN future
| lean years. 10 his dividend temporarily re-
| duced from . TO > per cent and then be consd-
| eraby ahead his purchase. since wholly
| secure investments in these days do not pay
| over 31z to 1 per cent The serious attitude OF
| the public towards this great corporation was
strikingiy shown in the severe rebuking OF its
| President for his appearance at Monte Carlo.
| Investors would have been entirely Indifferent
10 that. were II not that they regarded the cor
| pOratiOn Of which Mr.. Schwab is the head as
something large and important to permit
any gambling speculative taint being given
| to it
About cold dose as the market has had
/ for long time the announcement OF the
| $3n0oaOOO new bond issue by the Atchison
| Company If the directors OF the company
| could have heard the talk In the general run
| OF banking and commission houses they would
| not have felt COmfortabIe There was substan-
| tial unanimity in condemnation OF such fnanc-
J ing. The first effect was shown in the imne-
! diate decline in the price OF the Adjustment
| bonds. the new issue coming ahead OF them.
| both 10 principal and interest. Not few
| people declared it a breach OF faith with
| holders Of the Adjustments However this may
| he. what is indisputable is that for the next
| twelve years, the Atchison Company Will have
| TO pay out $3JOOO0O annually more than Il is
| aging now before anything is left for interest
| on the Adjustments dividends on the pre-
| ferred and common stocks. The dividend re-
| quiremerts amount 70 a heavy sum-nearly
| 100000
| Can the company keep this up? II IS playing
| in great luck now. but viii it always have such
| good fortune? No prudent business man would
/ be justified in acting such an assumption
! The years OF the lean kline come. as we'll as the
fat: and no corporation knows that better than
! the Atchisou Estimates of the great increase
| in earnings TO come from the expenditure OF this
! thirty millions are very precise; but they are
| estimates only after all-that is to say, assump-
| tionS; whereas the annual payments 10 be MADE
| on this new issue are hard facts
| With the necessity for raising this great sum
| tefore them. of which the directors must have
| been we'll aware they raised the dividend on
the preferred stock TO the fun ! per cent; and
| after this started dividends on the common
| first at the of 8 per cent and then OF l.
| After doing this they bring out the bond issue
! The nearly unanimous opinion in the Street is
| that the preferred dividend should have been
kept at / per cent. and that none at all should
| have been paid on the common As IL stands
now, the bond issue and the dividends appear
/ 10 have an unpleasant relation TO each other
No matter what mans income may be. he
| has no right TO set up a horse and carriage II
| ne has to borrow the money to do II with. This
| is what the Atchison directors appear to have
| done.
| rumor was in circulation in the early part
| OF the week that the Erie Company had a bond
| issue coming but this has been denied by OFF,
| cials OF the company. IL hurt the stock for
| time but recovery came later on the denial
The new stock issue by the New York Central
OF which announcement has been made-appar-
emily rather before the time originally intendeu
will be largely needed for the improve
ments in terminals. These will call for con-