The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-08-11

Stocks and bonds In treasury ..,,,..,... siA00ls
Concessions, lcasehold, good VIII ,... B,27S, ass
| Stocks and bonds outside companies 535. i0s
| Land Title and Trust Investment fund. 68S. 49,
Retainers and deferred payments ...,... 3.iiS,i
Bonds. warrants. bills. accounts rccciva-
| Bile NEUTRALITY-SUSPICIOUS.. S0e.a54
Inventories l.l0a 0l0
| Expenses paid In adv ncc ................ 2s.57O
Stocks and bonds ucss book value, $500, 3SI
| This shows a total of nominal assets OF
approximately S8l, 100000. The total OF
liabilities is given as approximately $780,
0o0, 900, with profit and loss account show
ing deficit of a few dollars less than S.
900 coo. But this is not so much the special
| point in question.
! In the foregoing tables the sum Of $lo-
350, l02, shown as cash, plant, &c, may he
regarded as actual assets in commercial
undertaking in process of operation. Of
the remainder of the SOL 600 900 nominal
assets, as shown in the second table, very
much the larger portion of il is shown in
such entries as stocks, bonds. concessions.
good will. DC. Investigation of these al
legged values shows that all except small
amount were either problematical or dis
tinctly Fictitious. The stocks and bonds
were holdings in either the parent company
or in the subsidiary companies, and the
whole outfit was manifestly bankrupt.
Good will may or may not be an asset of
value, and concessions are equally uncer-
tain. The 81, ll5,4ls of "retainers and de-
ferred payments" represents a sum with
held by cities to guarantee work done and
to pay for necessary repairs. 1t does not
appear how much of this the city OF New
York holds, but the condition Of some OF
her streets makes it evident that there
should be very little Of it to go back to
the paving companies If the needed repairs
are made.
The actual value OF these assets is little
else than mere guesswork But this was
the basis upon which the investing public
was invited to pour out, and did pour out,
its tens of millions Of dollars. Although
anticipating its place in the rehearsal OF
asphalt affairs, it should be noted here
that, on May Is, 1909 a receivers sale, held
by order of the court saw the total assets
Of the Asphalt Company of America and
the National Asphalt Company sold under
the auctioneer's hammer for S6,0O8 900
This sum A probably not far from the real
commercial value of the whole institution
as business enterprise, if properly con-
Quoted. Run upon business lines for bust
ness purposes only, a profit Of s to 10 per
cent. upon that capitalization might be
looked for by its proprietors and no more.
Yet honorable gentlemen assured the pub
lie that interest and dividends would he
paid on ten times that capital, and that
all was proper in law, equity and morals"
The only conclusion open to an impartial
observer is that the public was being very
extensively humbugged.
This was the condition Of affairs in Decem-
her, 1901. Under date of July 1s, 1902, a
duly appointed committee issued plan of
reorganization from which the following
self-explanatory extract may be taken:
Default has occurred In the sinking fund payment
upon collateral gold certificates OF the Asphalt
Company OF America. due Jan. |. 1902, also
In respect to replacement Of moneys withdrawn
from the 50 900 guaranty fund To meet semi.
annual payments due upon the collateral gold Ger
thcatcs OF the Asphalt Company OF America: also
In the semi annual paynyrtS upon the collateral
gold certificates OF the Asphalt Company Of Amer
lea due April J. 1902. and also In the semi annual
payments and the sinking fund payne upon the
gold collateral certificates of the National Asphalt
Company, due Jan. 1907 Suits have been brought
Dlstrc, OF New Jersey under the insolvency stat
utes OF that state, for the winding up OF the affairs
of said companies and the sale of their assets and
In said suits both OF said companies were decrced
Ia be- inSolyent.
What else could possibly be expected
from such distinctly stock jobbing bubble
organized and conducted for the enrich
ment of few and tho impoverishment of
many? The blow fell not only on individ-
uals and institutions capable of bearing il.
but as well upon widows and orphans, es-
tates in trust, and upon small savings of
the poor, all victims of misplaced conf
dence in names of high standing.
The report of July, 1902, proceeds with
the statement that the conclusions Of the
committees were that the interests of all
concerned would be best served by a re-
organization and tho acquisition of the prop
critics by new corporation. To this end a |
plan Of reorganization was therein SUBJ
mitted. The new company was TO ISSUE !
33l OO0,0 900 in stock-Sl4 600 900 in s per cent
preferred emulation, and $i7. 600 600 in
common stock A voting trust was to be- |
organized in whose hands should be placed
the securities of the bankrupt orpaniza-
voting trust. was, for period of ten wears.
to be deemed and construed to constitute |
an absolute and irrevocable assignment to |
the committees, for such Use as thew NAV |
determine, Of the title to such securities and |
of all rights and claims of whatever nature |
and character and howsoever arising ON |
the part of such depositing certificate hold |
ers against the American and Nation al |
companies, or any promoter, stockholder
director, officer or trustee Of either Of said
BY asserting to such an agreement os |
this, the assignment Of all right and all |
voice in the handling OF their interests for |
a possible period OF ten years, the security |
holders were asked to whitewash the pro- |
moters who had ruined them, and whose |
books showed that, even when they were |
assuring security holders that the bust !
ness was prospecting and solvent, they were |
paying the interest on their bonds out of a |
fund deposited az security for those bonds.
and not out OF the earnings of the business
For the purpose Of presenting a local
opinion upon this transact the follow
ing from an editorial which appeared In the
North american Of Philadelphia on july II.
1909 IL quoted:
Many OF the In vestorS paused. But from sverv
quarter came assurances OF safety. II was pointed
out that the members OF the committee were dis
tlaguiShcd hnanclcrS. the heads OF solid CORDOBA.
tons men OF the StrCtcst Integrity Resides i,w,s