New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1904-12-11
The Financial World.

clear proof Of inherent strength
The market movement. eliminating Thurs
day. when temporary declines were scored -
panic proportions. will pass into history as
freak phenomenon. Vague uneasiness appeared
two days earlier when the Presidents message
became public-Wall Street looking askance a.
the clause recommending legislation To increase
the power OF the Interstate Commerce Commits
sion. Bears FASTENED TO proclaim this the be-
ginning OF the end-professed belief in annihia-
ton of railroad earnings: and with skilruuv
timed action. Thomas ". Lawson eliminated
his campaign against AmaIgamated Copper FL
ing the newspapers with picturesque perfervjd
utterances- Cautiously at first but growing
holder and holder. bear attack proceeded until
on Thursday conditions were created IN the
security market for which parallel can only b
found on May o. 1901. Declines OF five 10
fifteen points appeared. not only in speculative
issues but also in standard stocks OF unquez-
toned merit. For few hours IN looked "a q,
panic was imminent-no one knew WHY bun IN.
tape continued to record amazing loszes-i-
looked as IL Wall Street had concluded thai
prosperity dream and value a cblunara
But as the hours passed It was found thai
buyers still existed-were indeed with persist
ence. though without noise. absorbing what Vas
recklessly pressed 10 SALE and swift racovs-v
ensued- At Thursdays close material gain from,
low points had been scored, and Friday and
Saturday were marked by steady rational up
ward movement.
Many explanations are offered OF this re-
markable incident but the simple fact is that II
was temporary yielding to hysteria by profes-
sionaI Wall Street. the influence OF which was
scarcely perceptibIe in other quarters II Is
certain that II owners Of securities had partic-
pated in the alarm Friday and Saturday mus,
I a Of SalIf lob,
| have carried prices below Thursday. It Is Ger
tain that If commission houses had been loaded
Win weakly margined stocks nothing could
nave stopped the development OF panic
That precisely opposite conditions exist Is Ger
tihed 10 with unmistakable emphasis by the ac-
ton OF the market. And at no time was there
any nervousness in high banking circles or in
the greater brokerage houses.
| viewed impartially. what has happened? M
Lawson has conducted q successful bear opera
ton In Amalgamated Copper, nor can any one
accuse him Of lack OF frankness I'm his methods.
| Whatever the merits of his argument nav Be-
whether Amalgamated be worth par or worth
hothing-he has proven his capacity to COM
mand public hearing But take the worst nos
sioie conclusion, that Amalgamated is a worth
Tess property; and. even So that could nor
greatly or permanently affect other securities.
Forced sales OF AmaIganated at the decline NAV
| compel individual holders here and there 70 rarr
with other stocks and so exert some depressing
influences; but that whole company could he
absolutely wiped out and the United States
would stil remain with its five billion agricult-
| uraI crop. its mineral production. its eighty
million population. prosperous and undepres-
| sible.
| As to the Presidents recommendations +bsr.
| is no warranted worry In so far a. Iepf.,atfo7
would stop the rebate system no one. tncludinr
the railroads themselves. could have any fair
ooJecuon The practice is admittedly evil and
| lI-derenSible- As TO how to cure il that IA an
other matter. The Presidents suggestions nav
| or may not be now acceptable TO Congress- bU-
| IN no event can there be any hasty iH-consId
cred action. Absurd. indeed. is the tbeorv OF
| bear extremists that the government h con-
nllttea 70 warfare against the railroads OF
course the governments regulative power Over
interstate commerce is conceded. but there are
CONSTITUTIONAL limits sufficiently well defined
projecting property rights IN railroads as in any
| other possessions OF citizens.
with the furry over. the security marke.
/ stants III strong condition. Such weak HOLDINGS
as were being carried must have gone over
| oodTu-to that extent extinguishing a source 90
| weakness 1t is evident. however that such
noIu4nsS were relatively small Great additions
| nave been made 10 the short interest which with
| conditions holding, will be compelled 70 cover
| IN q strengthened market-actuaI securities not
/ being scared into Hquidation-and this is the
| fundamental feature. Owners of bonds and
| stocks bought for investment refuse to take
! fright at professional Wall Street antics keep
| ing their properties with serene Indifference 10
/ the paroxysmS Of the Street. That they ara
| Justified in this attitude Is testified TO by the
opinion of every important banking house with
| whom l have conferred. Conditions have NOT
/ changed iota; there remain the material
| facts OF abundant crops, satisfactory com
modify prices. industrial activity, increasing
! railroad earnings and easy money. Such
/ conditions make bear campaigning very
hazardOus-gOing short OF stocks is flying
/ IN the face of known developments. Selling
securities because President Roosevelt wants
! to correct the rebate abuse or because Mr.
Lawson thinks poorly Of Amalgamated IS uOr
a particularly astute proceeding But. Il may
be argued, stocks did fall on Thursday; they
did; and at their lowest there actual shrink
age in quotations OF hundreds OF millions %
dollars. but there was shrinkage IL intrinsic
value. and quotations have intelligently righted
| themselves. Value is not decided by hysterical
stock market gambling-it is made UP OF as
/ sets and earning pOwer-and not one single de-
velopment of the week reveals Impairment in
| either OF those factors. on the contrary, all
| railroad and Industrial reports disclose con-
/ tinUal improvement-nOt a single disSODanr
| note Ia heard-prosperity fairly bOOms. The
| bear party has shown its power. pressing cir
| cumStances raVOrlng, TO break the market for
/ two hours as against years rise. but impO-
tence TO maintain the break is plainly manifest
/ Owners OF securities have business knOwledgS
i enough and business sense enough 70 decline
being scared by the hipprodroming OF Val
| Street Authorizations
| Throughout the raiding excitement one note
| worthy fact showed clearly-the fact OF the
| steadiness and aggressive strength Of thOss
| lower priced stocks which represent developing
| properties. This is true both TO railroads
| and induStrials. Take Southern Railway conf
Paper common for an industrial example Deths-
In the markets worst hour showed substantial
decIines-and | quote them as representative OF
long list OF similarly situated properties where
| IN good management promotes prosperity