The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1904-04-08
BUSINESS SITUATION.
Merger Decision Has Had An Excel.
ent Effect Henry CleWs' Letter.

WcTYcI DcCiotOI Huo tioo HH 1870"
ent Effect Henry CleWs' Letter.
New York, April 3.-Henry Clews says
that one effect of the merger decision has
been to remove the uncertainty which
held in check a number of important
railroad deals. Now that competing
roads cannot be put under control of a
holding company other means are being
sought for railroad development, for re-
straint of cut throat competition, and for
stability in rates and earnings.s The
enormous growth of our railroad sys-
tens has created forces which tax the
ingenuity of our ablest inanciers and
lawyers to withstand; and self-preser
walton is simply driving the great leaders
into some sort of cooperation, which
they naturally desire to make as perma-
nent as possible. Just where the line
shall be drawn between too much con-
centration and too much competition is
the problem now before the railroad
magnates of the west; and it is impos-
sible for either insiders on outsiders to
anticipate the final outcome Suffice it
to say that moves of great Importance
are now being made on the financial
shessboard the ultimate outcome of
which is likely to be beneficial to all
concerned. Incident to these final OBJ
iects there may be temporary differences
of opinion, as well as strong play for
position and mastery, but all interests
seem agreed that something must be
done to conserve the interests of both
owners and users of railroads, who are
alike benefited by stability and reason
ableness of rates. Since unrestricted
competition has proved injurious to all
interests. and consolidation of Compel
inc lines has been decided to be against
both the Sherman antitrust law and
public interest, some other device must
be utilized, temporarily at least, until a
better one Is secured. The community
of Interest idea has consequently receiv-
ed a fresh and powerful impetus from
the recent decision of the supreme court,
and most of the negotiations now 60
ing on seem to be based upon that plan.
One thing is quite certain: those who
lead in these movements are not going
Northern Pacific panic of 1901. There is
fortunately little, if any, probability of
repetition of that memorable event.
About all that can be said is that eX-
ceedingly important negotiations are UNI
der way between those who control the
various continental railroad systems, and
that these parties are earnestly working
to reach an understanding, either by
friendly means or possibly through the
courts, but not by contest in buying
for control The sharp advance in Union
Pacific was unquestionably the result
of these movements; but, since nearly
all of the Pacific roads are still enjoy
ing exceptional prosperity and earning
considerably more than present divi-
dends, the present is an especially OPP
perfume time for reaching an agreement;
much more so than if traffic were scarce
and dividends problematical
Under the stimulus of these condi-
lions the transcontinental stocks eXhib-
tied unusual strength, Union Pacific lead
ing. The strength of these particular
stocks was genuine, and based not only
on the large earnings of the Pacific
roads but also upon the probability that
Union Pacific and ST. Paul will together
form a permanent through transconti-
mental line. 1t is influences such as these
which are dominating the stock market
just now, encouraging trading in other
shares and imparting an upward trend
to values as result of better feeling
generally. The approach of holiday
and rapidity of the advance induced more
or less profit taking and consequent
reaction; but it is doubtful if these
negotiations have yet exerted their full
effect.
The money market continues easy be-
cause business and speculative require
ments are less urgent than formerly.
Neither the April settlements nor the
prospect of gold exports had any appre-
ciable effect upon rates. Some com
ment was made upon loans passing the
billion mark for The first time and the
prospect of diminished bank reserves;
but even these factors created no un-
easiness in banking circles, for the reason
that the present high record in loans is
largely due to the borrowings of strong
CORPORATIONS. who find it more advant
aoeous to raise necessary funds in this
fashion than to issue new security issues
when values are low London has been
more friendly to American stocks; but