The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1903-03-22
IMPORTANT POINTS INVOLVED
STANDARD OIL PEOPLE TALK OF
LOWER PRICES FOR STOCKS.
Hints for People Who Speculate in
Copper Stocks - Gates's Reappear-
ance Awaited with Interest.
'ecial to the Indianapolis Journal.

Sohlio'elsy DroaoenS as the situation Is
studied. Mr.. Keene's initial move is an at
tack on the Union Paciic's center in secur-
Ing temporary Kentucky injunction to
prevent Hartman voting the s9o,0O0,oO0
Union Pacific holdings Of Southern Pacific
stock, and he feels that he has gained a
signal victory. Whether the Injunction is
allowed to stand or not, Mr.. Keene is sure
of representation on the Southern Pacific
directorate. The Kentucky statutes allow
cumulative voting by minority interests,
and that will give him place in the direc-
torate even though he should be beaten in
his preliminary moves. The annual meet
Ing, however, will by no means end the
battle, no matter which way 1t goes for IL
Is the announced Keene purpose to prevent,
IL possible. the further expenditure of
Southern Pacific revenues upon the Central
Pacific, which he contends is now a part of
the Union Pacific line proper and natural
competitor of Southern Pacific
Mr.. Keene is aiming directly at the over
throw of the consolidation of the two sys-
TENS, and bases his legal fight squarely on
the proposition that in effecting this COM
bination the Hartman party has violated
not only the laws of Kentucky, under
which the Southern Pacific was organizeD,
but also those Of the States through which
the several lines pass, and besides acting
in contravention of broad public policy.
The legal points are laid somewhat along
the lines adopted by the state and federal
authorities in the Northern Securities liti-
cation, but Mr.. Keene's case is considered
the stronger of the two from the fact that
the consolidation of Union and Southern
Pacific is the more open. No attempt is
made to conceal the fact that the two
properties are operated as one and under
one direction, whereas in the Northern
Securities the pretense Of separate official
arrangements is kept up. There is no con-
nection between the government case in the
north and the Keene case in the south
The latter is strictly private enterprise
and can be forced to a conclusion regard
less of the jugglery, mystery and suspicion
of good faith which is beginning to attach
to the Northern Securities litigation. There
is very good ground for the SUSPICION that
the Northern Securities case will never be
brought to a finality under the present d.
rection. 1t Is beginning to be understood
in Wall street that the railroad companies
recognize the weakness Of their position
In antagonizing the statutes prohibiting a.
consolidation of competing lines. That
knowledge is the underlying bulwark of
Mr.. Keene's proceedings against the Schiff-
Hartman party.
Mr.. Keene's attempts to prevent Messrs.
Schiff and Hartman from using Southern
Pacific earnings on the Central Pacific
main line recalls the fact that the propertv
he is now trying to save was built largely
at the expense of Central Pacific. Under
the management of Mr.. Huntington and
his associates Central Pacific was starved
for long period of years and Union Pacific
half starved in order to build the Southern
Pacific line. The Schiff- Hartman policy
now proposes reversal of the Huntington
scheme. These people are now rehabilitat-
ing the Central Pacific line at the expense
OF the Southern Pacific. Mr. Keene admits
that this might be justice if the Hunting
ton people or their heirs were. pavinp the
debt, but as an innocent and new holder az
Southern Pacific stock he objects to havinr,
the Huntington obligations saddIed off on
him and his friends. He wants Southern
racine earnings TO go TO Southern Pacific
stockholders to be reinvested in the
Southern Pacific line instead of I'm the mn
building or a understanding himself to feed
the opposition. This is the nub of the con-
tention. As the Keene fight develops In will
become increasingly interesting to minor
ity stockholders in all kinds of cornora-
tons, and 1T may also end in a settlement
upbuilding or the notification of laws des-
tined to protect the people against schemes
10 XIII competition among railroads.
XXX
Leading bankers more or less identified
with Standard Oil finances have been for
several weeks preaching lower prices for
stocks. The burden of their discourse Is
that people will not invest their money in
3ls and per cent. securities and keen il
there when they can get Az to per cent
lending 1t in the open market. Stress has
peen laid on the statement that the bond
market has become stagnant and that buv-
ers will only put capital into this class OF
securities at marked concessions. AS n
the latter statement it is only measurable
true, for while transactions in bonds have
shrunk somewhat in the open market a
very lively counter trade has been goinp
on continuously. Small investors have beer
buying extensively. and the actual volume
of the bond business has suffered slight ii
any, diminution. The record of savings
banks shows that the accumulation OF
money in the hands of the middle class has
been proceeding sensationally. 1t is from
that source that the inquiry for choice Sc
curities comes. The Weather classes are
inclined to hold off for the time being. let
ting their funds accumulate in the banks
subject to employment in the loan market
This is what the bankers of the STANDARD
Oil kind are playing for. Money has beer
piling up too fast in the hands of the mid
die classes to suit the heavyweights. The
| deposits in the savings banks of New York
State alone are nearly as great as the COM
bined deposits in the trust institutions and
clearing house banks of New York city In
actual money the savings banks accumu-
lations exceed those of the regular banks
and trust companies. In the latter a very
large proportion of the deposits represents
money borrowed and then deposited, where
posits are the actual stuff, the fruit OF
thrift and savings. 1t may be mentioned
also in this connection and in spirit OF
rejoinder to the bear arguments advanced
by the banking element. that the rule
against fixed investments in low interest
bearing securities does not apply to bank
stocks which are selling to-day on a to 2ll
per ce.lt. basis. Chemical Bank stock sold
recently on a per cent. basis, although i,
| italization. Evidently, what is sauce for
the goose is not sauce for the gander.
In Amalgamated Copper IL is the same
| old crowd working the same old game
| Amalgamated has a share capital of sl55..
100000 When originally foated by H H.
Rogers, John Archbold and other Standard
OIL associates IL was in high Investment
| and speculative favor. Insiders sold out
| above par and went enormously short OF
the market The price broke from 100 tc