The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1903-10-03
ABOUT VALUES.

| n NALOk<sos
There ia one valuable lesson to be
| learned from the recent slump IN the
| stock market, and that is that valuable
| stocks cannot be manufactured by the
| printing press, any more than that valu-
able money may be manufactured by
the Same process. This lesson should I'M
press itself upon those who seem to thinK
that the government may set It's presses
to work and turn out greenbacks 40
libitum and in floods and supply the
nation with an abundance of currency,
every such dollar note manufactured be-
ing worth dollar in gold The credit
of this government is good and Its notes
pass current at their full value In nearly
all parts OF the world. But that is be-
cause the public understands that the
government Is able to redeem It's notes
In gold and that 1t does not issue more
notes than 1t can abundantly protect.
That explains the difference In current
value between silver dollar Of the Unitee
States and n silver dollar of Mexico.
Great corporations may issue millions
and millions of stock, and In boom times
such stocks may have fictitious walue.
But sooner or later true merit will assert
itself. If corporation can demonstrate
that there Is dollar of true value behind
every dollar of stock issued such STOCK
will under normal conditions sell at or
near par, provided the rate of dividend
is satisfactory to the holder In abnormal
conditions OF prosperity, boom and specu-
lation, fictitious values may be MAIN
tanned, and in abnormal times of pessi'
mism and depression good stocks may sell
below their intrinsic worth. But with the
return Of normal conditions true values
whether high or low, will assert Them
selves.
"A while back, this country was revel-
ing in prosperity. and speculation was
rampant. The public had an enormous
appetite for stocks and the mills OF the
corporations ground them out and OIL
fered them to the public IN enormous
volume. The value OF many of these
stocks was based. not upon the actual
property behind them, but upon the
learning capacity" Of the corporation
mills, or railroads. or what NOT. IL was
all right SO long as earnings were great
and growing, so long as large DIVIDENDS
we're forthcoming. so long as the specula-.
tive craze lasted. But by and by When
signs of trouble appeared and the specu-.
lative fever began to subslde, discreet
men began to pay more attention TO ac-
tina, values and then it was that the
bubbles began to burst.
We are not discussing stock market con-
| ditions per Sc, nor all the various causes
| that have led on to the cataclysm IN Wall
| Street We are discussing an economic
| principle. We are trying to show the
| difference between true value and 1isti-
tious value. We are trying toshow that
wealth cannot be created by Issuing
bonds and stock certificates Bonds are
| evidences of debt and stock certificates
are evidences of ownership. But neither
is property In itself, as some people
seem to think. There must be tangible
| property behind the bond of corporation
| and tangible property behind Its stock,
or its bonds and stock certificates VIII
be worthless The bondholder must be
sure of his security before he can be
s,,rc of the value OF his bond, and tho
stakeholder must be sure that his stock
represents dollar for dollar In good tangi-
BILE property, before he can be sure that
1t is worth its full value.
We are having an interesting shaking
IN now in the financial world land re-
| adjustment of values. water IS De-
Ing squeezed out Of some stocks and
squeezed pretty hard. In some instances
n was found that after the squeezing HiS
done nothing was left. But In all cases
the squeezers are trying to get down
IN substance. Water" has no value in
n market like this.
II is true that mnny stocks of splendid
value have been depressed below their In
trlnsio worth for revolutions always run
to- extremes
But after the revolution shall have
ended. after the water has evaporated,
fter. the dross has been burned out, ar
tor tho chaff has been blown away, the
financial world will begin to take ac-
count Of the remains. and prices VIII be-
come steady. Good stocks as we'll as bad
stocks Will sell at price which fa'rly
represents their real value
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