Omaha daily bee., 1902-04-07
TO GOOD SECURITIES
Unexpected Strength of Earnings Makes
Railroad Stocks Strong,
INDUSTRIALs ARE THE WEAK POINTS
RumOrs of MIsmanaRement Cause Un-
easiness-GenersI Business Good,
High Wages Promoting
Consumption.

NEW YORK, April 6.-(Special. )-Henry
Clews, head of the banking house OF Henry
Clews & Co., reviewing the situation on
Wall street, says:
The financial situation is sound and gem
orally satisfactory. Desirable Investments
are In very good demand and exceedingly
scarce, even at present high level. Hence
nrst-class railroad securities are held with
tenacious hrmness, which seems to grow
with the continued and wholly ~unexpect-
edly favorable railroad earnings. The most
sanguine expectations in this respect have
been far surpassed, and conservatives are
often afraid to express their convictions.
The real reason Of railroad prosperity,
however, lies not so much in the increase
In the volume of traffic as In the better
the volume of traffic is not equal to last
year, but high and we'll maintained rates
explain current railroad profits. The great
and its control of the rate situation is now
being ilustrs ted. 1t has more to do with
the present high values of railroad shares
than any other single Influence, and so it
Is easy to understand the constituencies of
the market to any legislative attacks that
doubt much concern in railroad circles over
the aggressive and antagonistic attitude of
ene aa n mdintsstara6 toward raiir9ad inter,
pnoceedings will be watched with intense
interest. Tn public want stability of rates
above all else; they also want reasonable
rates, and IL legislation is confined to these
two iimitations no danger is anticipated.
rates, something entirely incompatible with
stability and equality of rates. Between
these eonfiicting, demands the legislature
concerned; not forgetting that the many
thousands of stockholders and those de-
excitable, easy-taiking shippers who dis
regard every interest but their own.
The most questionable point in the stock
market is among the industrials. During
the last few months we have had a success
sion of unfavorable reports from these con-
Germs, showing decreased earnings, mis-
management and a general failure of the
roseate promises in early prospectuses.
Under such conditions the loads OF over
capitalization begin to have their effect,
and not a few concerns, which It is I'M
necessary to mention. have already under
The future OF this branch Of the market is
not promising; The day OF reckoning,
At present It Is delayed by the large de-
mand of all kinds of manufactured pro-
ducts; in short, by the general activity of
to subside, prices decline and Increased
expenses cut into earnings, then we may
look for results which everyone hopes may
danger is not near, but II is real and should
not be lost sight of.
change. There is no scarcity of funds for
good borrowers, but rates are steady and
likely to remain SO until the reserves begin
British and Russian loans are in prospect,
and these would no doubt cause some dis
turbance I'm the international money mar
kets. In this connection II is we'll to re-
member that our imports are steadily rising
and exports declining, rendering impossible
the remarkable trade balances which were
such a stimulating feature in 1901 and 1900.
General business continues In good condi-
consumption in all lines of manufactures
goods, and, as distributors throughout the
country appear to be carrying small stocks,
the prospect is for a good spring trade. At
the same time the rapidly increased cost of
living is beginning to check consumption
and may soon express itself In more eau
tious buying in the wholesale markets. The
state of phenomenal activity. though new
competition is making itself felt, and, while
many of the mills hold orders. that will
keep them busy for months, still prices at
first hands are not so steady as a month
or two ago. The textile trades seem well
employed; orders in sight are plentiful,
hence the Willingness OF both cotton and
wooden manufacturers to grant their en-
ployes advances In wages. Any curtailment
however, in the demand for staple cotton
goods with cotton at it's present. high level
would seriously inconvenience cotton manu-
facturers. and the woclen mills are not en-
loving the same degree of prosperity that
they did a year ago. Very soon the CROP
outlook will be a factor, and the indica'
tions are that high prices will encourage q
larger acreage for corn and cotton. II moi
certainly insure us another year of pros
perity. -
The apprehension OF gold shipments still
hangs over the market. But there Is nc
fear OF the money situation being disturbed
thereby, as any gold shipments will be
loudly Offset by the return of funds from
interior points to this center from this time