The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1904-03-20
THEWEEK lNWALL STREET
NORTHERN SECURITIES DECISION
FACTOR OF MOST INFLUENCE.
Financial District Does Not Believe
Government VIII Proceed Against
other Combinations.

Special to the indianapolis Journal
NEW YORK March 19.-WaH street has ac-
cepted without hysterical display the Supreme
Court decision in the Northern Securities case.
Relief from the long period OF tension was
signalized by sharp recovery in the general list
of stocks traded in the Exchange. Whether
this recovery viii hold remains 10 be seen. 1t
IS the point upon which there is honest difference
of opinion.
In pursuance Of it's Practice of jumping at con-
illusions Wall street very frequently makes mis-
takes. AS rule. however. it gets somewhere
near the truth. IN the present case it has taken
the stand that the government will be content
with the moral victory gained and will not
soon take the initiative against other combna-
lions.
The decision handed down by the Supreme
Court is held to be a warning which must be
observed and hereafter ambitious kings Of
finance restrict their operations within
fixed legal limits and must attempt to over
step or circumvent the laws. Now that the YER
dict is in there is a widespread disposition TO
cOncede the wisdom of the administration in
stepping in to check the development and growth
OF tendency toward combination in violation
of state and national laws
1t is discovered that the decision of the court
is only against Illegal combination in restraint
| Of trade, and does not affect in the slightest
! degree legitimate enterprises. The holding COM
pany as such is not assailed. 1t is only when
the holding company is employed to defeat the
! law that it Is held to be invalid. wrongfully
used 1t is in identically the same position an
| individual might be who might attempt to
commit an unlawful criminal act and can
be proceeded against with the same certainty
of conviction. Successful prosecution becomes
simply matter of proof of violation of the
law
AT first blush great many people Jumped
to the conclusion that death-blow had been
| given holding companies. Some little time has
been required to correct this error The holding
company organized for proper purposes and con-
Quoted legitimately performs very useful Of
| flee in the financial world. 1t is a species of
| corporate trusteeship and has become an in
valuable part of the financial machinery of the
| United States.
There is not the remotest possibility Of its
| displacement impairment. When however
| those in control of holding companies attenp,
to use them for the purpose of organizing and
| carrying combinations Of railroads or in
dustrtals which can be proved to be in restraint
/ Of trade, they do 1t at their own risk and be-
come subject to discipline. Their houses may
be pulled down their heads.
| There are many combinations which are ir
reality holding companies. but which do not
carry that name. They have become holding
companies in the incidental growth of business
! The Pennsylvania and New York Central Rail.
road systems partake of many of the features
of holding companies. and it is by no mean:
certain that they entirely free from ths
errors fallen into by J. ]. Hill and his associate.
in the Northwest lie Pennsylvania has a con
trolling voice in the Baltimore & Ohio Ches
apeake & Ohio. Norfolk & Western Readins
and other parallel roads while the New Yorl
Shore. long ago took over a competing line be
tween Chicago and New York. The Atlanti,
Coast-line might also come under the ban b,
reason of its recent absorption Of the Louisvill,
The Union Pacific in assuming the. RESPONSIBLE
ity OF buying control of Southern Pacific nigh
also be within the danger line. In the industrial
Oil Company are probably vulnerable but thes
no more than before the handing down of th
decision on Monday last.
Without exception every important railroa
system in the country has absorbed minor lines
1t so happens that in a great majority of in
stances, however, these acquisitions have bee
in the way of legitimate development and exten
sion. This is conspicuously the case with Penn
sylvania. Southern Railway, Northwestern 81
Paul. Illinois Central and Rock Island. The las
named possibly illustrates the idea OF the ex
tension and rounding out of system better tina
any of.the others mentioned.
|
road having about 1000 miles of track into a sys
TEN embracing approximately 16. 900 miles. Yet
in all this tremendous development there ha
which is operated by a holding company' i.
therefore, free and clear from attack eve
though there should be a disposition to pres
the advantage gained by the government. ''0-
The United States Steel Corporation is hold
Southern Railway and the Erie system are ur
der the management Of voting trust, anothe
with its alliances and combinations. was cor
Quoted for many years by a voting trust. whc
only recently dissolved.
! Many of the shrewder traders on the Exchans
bought quite heavily during the past two week
on the theory that even in the event. OF an ac
verse decision in the Northern Securities case III
market would have smart recovery. They hel
that the worst had been discounted and tbs
If the necessity should arise the strong interes
would support the market and give it a boo.
just to show that property had some real valu
which its owners not afraid to stand 70
, The statement made by Attorney General Kno
= that the administration had no intention ,
running amuck was tonic TO the stock marke
1t filled spectators and investors with more COZ
hdence than they had felt in months. The r,
r finance would take hoed and cease their attsmp
3 10 carry comblnation 10 alarming lengths.
fact. these kings of finance were hardly in nee
| OF a Supreme Court warning.
| eighteen months has chilled their ardor for e,
| pdnSlon ana ACKNOWLEDGEMENT. Natural forces ha
I given them the necessary check. Declining pric.
: | had in many instances curtaiied their power
and. i'll others had been notice which serve
the same purpose as a storm signal does to
S | ship captain There ensued n taking in of sa
and other preparations deemed essential for pr
= | lection against storms.
$ People in the financial district are interestir
d themselves considerably the probable pla
= which will be adopted by the Northern Securiti
e | party to conform the law as construed
the Supreme Court last Monday. Fears are 81
Y | tertained that litigation may follow attemp
TO redistribute the assets of the Securities Con
= | pany among holders of stocks and bonds of II
h | tween Mr.. T. II. Hartman. of the Union p:
| cific and Mr.. Hill is heard. but cannot be trace
| TO a reliable source.
: The estate of the late w. c. whitney whic
Z has been officially scheduled at 100000
. thereabouts. is. In reality. largely in excess
that sum. according to the statements made
i insiders. The zeal value is said to be sS1 900 %
q There has been a suspicion that the Within,
estate is getting rid Of a portion at least
its holdings in the new York traction cor
panies. There is also prevalent belief tn
: the estate of the late W. L. EIkins. of Phf
delphia. is tightening its holdings in the
companies. Messrs Whitney and Elkfns we
" two members of the small group of controIlir
y stockholders in New York tranctions
r. 1t is said that the assets of Mr. Whitney col
tanned almost cats and dogs" IL seems
e have been his policy to get rid of all evidence
q bad investments. He must have made mar
. such he in the habit Of subscribing
the enterprises of his friends regardless Of fhs
Fartt ,eRf 1fT11C 40 off