New-York tribune., 1902-02-09
financial.
The Financial World.

| tfcularly yesterday.
On Monday last great disappointment was felt
at the failure of the Supreme Court 10 hand
down decision in the Northern Securities case.
| This had been confidently looked for and the
market became heavy when it did not come
| Next day, gold shipments in excess of 81 4OOOOAO
were announced Both events did little more
/ than cause shading off in quotations and check
| trading. On Wednesday the list started TO ad-
vance under the lead Of Southern Pacific and
| the advance continued till yesterday. when it
was checked. and something more than checked
| by the startling character of the bank state
ment. Nevertheless. after the first surprise was
over, the buying of stocks was resumed: the
temporary losses were recovered and the list
| closed strong
This was very significant for the statement
! was thorough surprise and Wall Street hates
surprises. Nothing in the action of the money
market through the week had given an indica-
ton of what coming. Rates had tended
| downward; ~. and per cent was the rule:
and in time money, banks seemed very desirous
| TO put out much as they could at per cent
Therefore, when the bank statement showed the
astonishing increase of nearly 30 millions in
| loans (Which came the top OF 10 million in
crease the week befOre) and a drop in the sur
plus reserve of over SS, 100000 cutting that fund
down to less than Is millions there went up a
general exclamation OF surprise Then the mar
ket as suddenly dropped. The traders tumbIed
| over each other to sell. But the bull leaders
soon recovered themselves. Supporting orders
! checked further decline. then restored losses
and finally brought the market to a strong
| close.
The surplus reserve is little less than
IL millions a year ago. il was somewhat in ex-
! cess of ~ millions So the difference is not
| great. We had a wild speculation after the
surplus had been reduced TO that 20 millions
The item in the statement. however which
causes most discussion is the loan item. II now
| aggregates over 1000 millions. Once before It
has been trife larger-last March The in
crease of 10 millions week ago. and 30 MILL
ions last weeks millions in two weeks-is so
great so much beyond all requirements of nor
NAL business. that explanation is sought in the
various syndicate operations known TO be in
progress.
OF these, il can scarcely be said that the 80
million debenture issue of the Atchison has dis
appeared from the loan account. \ considerable
proportion of that issue has not yet gone into
the safe deposit boxes Of investors Then there
is the 10 million issue of 31s equipment trust
certificates by the Pennsylvania Company
taken by two leading banking firms. Lastly
have the forthcoming issue of ~ millions by the
Metropolitan Company. preparations for which
must certainly have been made in some form,
and in some form which has doubtless swell ed
the loan account of the banks,
Details of the latter scheme viii be made
known TO Metropolitan stockholders and tn
public about the middle of the week. when
official circular will be issued. 4 possibly pre-
mature publication of some features Of the plan
has given rise to some very wild couiscJu7c=,
which have certainly no basis excep; in tae
imagination of their authors. When tEe oiic'si
circular has been issued. it viii be possible -
Judge intelligently. 1t is safe to assume thal
the public will receive the plans. what, vc-
they may be- in extremely critical spi =
That is the public temper.
While substantial advances were recorded in
most of the railroad stocks. the leader vas h'-
yond question. Southern Pacific. This stock l.
which did most to start the market out of
it's ethargy on Wednesday. and it kept we'll 10
the front subsequent days Its CLOSING price
yesterday was ~. II is we'll known that
there is a warm controversy between TWO par
ties in this stock. The Union Pacific Company
is the largest single holder Of it; to these hold
ings must he added those of individuals con-
nected with that company; the combined hold
inES aggregating formidable amount. ON the
other side, there is a compact and aggressive
combination of minority holders. These two
parties appear to differ on thing only
the period when the present heavy deductions
from earnings for permanent Improvements
dends the stock be started.
The contention of the Union Pacific interest is
that the interests of all will best be conserved
by taking all surplus earnings-which are very
large, for the company is earning ~ millions
gross-and improving the property until it is
brought into the highest condition of efficiency,
whether this state of efficiency he reached in
two years or three. on the other side it is
contended that il is unfair TO deprive stock
holders of dividends for so long a period; and
that with the end of the present calendar year
at least these heavy deductions from revenue
should he reduced sufficiently 10 afford the
stockholders a reasonable dividend. II will he
seen that there is nothing to bear the stock on In
the position Of either party. In fact, both re-
gard the Southern Pacific property one or
the best in the country. Their differences are
over what. after all. may be considered tenn
porary financial policy
In the forward movement of the list, the Read
Ing issues rather Jagged until Friday, when they
began to show signs of joining the procession
The Eres appear to be still weighted with the
expectation that bond issue will be announced
sooner or later; but the various Gould STOCKS
have been strong. and rumOrs OF holding COM
pany on the model of the Northern Securities
Company continue to float about the Street
Something of the same sort is current IN re-
spect to the Vanderbilt stocks, and New York
Central has shown large buying
No effort is being made to advance the Steel
stocks. 1t seems to be Mr.. Morgan's policy 10
let them find their way to investors at their
present moderate prices The condition Of the
steel and iron trades is argument not only
for them but for all securities. since it con-
tinues to run at high water mark with no sign
vat ~ n turn in the tide. This barometer OF