The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1903-08-05
COMBINATIONS ARE DOOMED.
Henry clews Says They are the
Terror of Wall Steet.

Concerning the condition of the mar.
ket and the possibility of a panic,
Henry Clews says:
Wall street has barely escaped one Of
the worst and most disastrous panics
| in history. 1t has escaped because,
| with the remarkable steadiness and
upward tendency of the present mar.
| ket, there is no immediate prospect
of a prolonged catastrophe.
The present sensational decline in
values and the failures and wholesale
embarrassments it has occasioned can
only proceed from one tbing-the
enormous and deplorable .over-capital-
ization Of industrials.
More than five thousand million
dollars are represented in the largely
fictitious capitalization of industrial
combinations within the past five OF
six years.
Never in the history Of trade and
finances have such enormous sums
been represented as in the capitaliz-
ing concerns such as the United
States Steel Company, the Northern
Securities Company, the international
Mercantile Marine Company, Anal
gamated Copper and hundreds of
smaller corporations.
The day Of over capitalized corpora
tions in the opinion Of all conservative
and well informed judges, is over
once and for all.
I am afraid the Morgan school and
financial schools of similar type have
closed for long vacation.
Had it not been for the action Of the
great money interests of the United
States in coming into Wall Street to-
day with the intention of getting in
on the ground floor and buying the
choicest dividend paying securities,
there would have been disaster. More
than $500 600, 600 was ready to be poured
into the street when the stock ex-
change opened.
Big money interests awoke expecting
to see the market disordered and
to take advantage of it. It is signif-
cant that the word was not spoken.
Who was responsible for the silence?
is question that only such interests
as the Rockefellers. Harrimans,
Goulds and others can answer with
authority.
There has been shrinkage of 81
SOC, coo, 600 in prices within the past
ten days. The brunt Of the loss has
been borne by the big operators of the
street, and there is no Immediate rea-
son why it should affect the people at
large.
Buying was done today, as the orders
had already been given, but it was to
stifen the market and impart conf
dence. One of the most powerful
cliques in the country is behind the
present upward movement.
There is hardly any question that
within the next few weeks there will
be a general movement to dissolve
enormous Industrial combinations.
This will not be done with unwise
haste, but the sweeping out will be
thorough.
This crisis has been impending for
three years. Big figures have filed
the public mind. High prices have
not frightened the people, scarcity and
exorbitant rates have had no effect
nor have strikes. Buying and holding
on have simply Become chronic, and
the result was inevitable. 1ndustrials
have been the rage. They are so no
longer.
The extreme value to which stocks
were pushed, to which this late de-
preston is Cue, is clearly traceable to
the absorption of Chicago, Burlington
& Quincy stock at 200. This gave rise
to the expectation that st. Paul, Rock
Island, Mexican Central, Southern
Pacifc-the Keene creation-were
worth just as much, and the extraya-
CANT feeling caused an equal expecta-
tion that all other stock would follow
the same lead. Hence the rich people
of the country gathered them IN and
the liquidation is from those Quarters
and not from the lambs.
One initial cause for the present
crisis is our big Gnanciers have been
sacrificing their best holdings in order
to carry their poorer industrials, for
which there is no market. "A good
many Of the blows struck during the
past week have been OF sand bagging
character.
There are many good industrial
stocks which will safer extremely In
common with their poorer eRes. Moth
ing can prevent that, and therein lies
the oaly cause for anxiety.
This is tnerely cherries dawn of
the morning after a debauch of six
wears in Wall street. But the death
knell of combined indusrials is
sounding, and there is no reason,
with the atmosphere cleared and the
wreckage as a warning, to fear any
greater Generalization as result OF
the present passing furry.