New-York tribune., 1905-11-12
The Financial World.

week been subjected to some SEARCHING 49,"
We have seen transient rates for rnon.v-...s,
rates-Iifted suddenly to Is per cent and ,h.
has been overplusage of conservative n-,,...
that damage must so be done to market v,,,,..
Yesterdays bank statement showed frx,,
shrinkage, moreover. in surplus reserve arr-..
cutting below limits not reached in a long WIN.
Yet, in the face of these abnormal exhiht,, IS.
market as whole has not merely stood vail a..
shown actual strength. OF various fact. NJ
clear from the weeks incidents one .sn.o,.,''
certain is that securities are not in weak ,,,
are not subject to dislodgement from any .usa.'
speculative pressure induced by scares oe g.
sationalism. The list of net changes for ~.
week does not comprise very many seriou. IA.
clines. People who hold stocks are owner, a.
day beyond any average hitherto known. w.r
Streets outery for months past that the sn.c,,..
tive public is out OF the market has nor ..
sequel the disclosure that public specu,a,o-,
being out of stocks. cannot be disturh.r, :.
market conditions through either caprioiou. a.
enforced liquidation. They who have consist
entity bought and resolutely held securitis. sr,.
Ing recent times shown not merely n h.
financially strong enough to maintain ths -.
sftion they have taken, but are Of that rc.n,,,
calibre which puts reason back OF TRANSACTION.
has measured values. understood cond,to,.
recognized bargain opportunities To aim ho,a.
ing bear Trades against stocks so bought nd a.
held is but the verfest waste Of stocktohb.-,
breath
Take Reading for illustration. That I, N.
stock against which most vigorous a.sauI. \,
made both in criticism and in manipulation :.
| is much proclaimed that Reading has been r.ct.
lessly advanced. that its new market valu. \, /,
market menace. that grave results must b. IN.
natural sequel there. Reading has within a A,
months risen 80 points. This time last yea. 4.
sold around 20. compared with 140 now and
| barely three months ago 1t was under par Th,
| shows gains regarded rightly as extraordinary
| from whatsoever standpoint considered And II
| is. not strangely upon Reading that adverse
critics of the market concentrate in pointing out
| the worst example"
| Now. how do the facts mea sure with the out.
bursts of this hostile criticism? Reading has
certainly not been bought by public spectators.
1t has been acquired by powerful interests who
believe in its value. who declare positively thu.
! of their own specific knowledge its assets and
present and prospective earning power warran.
2O0 for the common stock. It must be borne in
mind that Reading is just as much OF an In.
dustrial as it is railroad. It's ownership Of coal
| lands through the Philadelphia and Reading
| Coal and Iron Company makes ii our chief pro-
ducer of coal The value OF Reading both as an
actual and strategic property is testified to by
the purchase of its control by joint VANDERBILT.
and Pennsylvania interests. through Lake shers
and Baltimore and Ohio: and there is further
/, large concentration OF ownership in what 10
F. commonly called the First National Bank party
| "a locking UP of capital stock leaving but
scant floating supply. control OF which Is the
impulse of the present buying movement.
Shrewd capitalists anxious to participate in tAs
ownership of this premier company are perfectly
willing to pay advancing prices for stock earn.
ing three times the dividend 1T pays.
Taking these facts into consideration. there ID
rfO rift Cfa hout
the rise in Reading. It's violent fluctuations
mainly due to the fact that as It goes up the
professional Stock Exchange element is tempted
to get short of 1.-THE old story OF cynical Wall
Street disbelief in yeritabe value. That actual
owners of Reading are not disturbed BY market
fluctuations confident OF the future OF tbs prop
erty, is evidenced by the fact that quotations
advance little stock comes upon the market. No
doubt here and there some small holders sue
cumb to the temptation of realizing handsenis
profits but the great proprietorship interests re-
main unchanged
If Reading be the worst example" a. all the
bear oracles proclaim 1t requires something
other than reason to induce despondency. IN
trinsic value back of market quotation needs no
supplement.
From many quarters issue suggestion, that
high rates for money are results OF manipulation
at the instance of bankers who seek thus TO keep
the security market quiet Representations OF
this sort coming from bull apoogists may bs
counted as baseless as the silly bear argument
that prices are high. irrespective OF merit and
earning capacity. We are having such phenom-
email good times throughout the country. ousi-
ness in every department is so brisk crop move
ment requirements unprecedented, that 1t IS
wholly natural that funds should be heavily
drawn from Wall Street for use in this vastly
increased general activity. What sensible OBJ
servers recognize clearly enough is that In so far
as crop requirements are concerned-and to tnaI
is traceable the severest drafn-the urgent oe-
mand is but temporary-has already reaehei
maximum. and should from this time forwhu
recede. Within the space of a very little time;
indeed the tremendous outflow TO the west ana
the South will have revolutionized into an IN
coming current larger by far than what vas
originally drawn. 1t is late In the day TO start
worries over monetary stringency. Inteliisenes
can have no patience with the fabrfcating OF any
such alarm.
IT is a curious situation which has for con-
spicuous feature pessimism bred by the iaeI
that the nation is prosperous-good times aeA-
gerous OF business facts which day py nay
make UP the public record there Is recltai sif'
efteration-consstently. continuany-of COM
merciaI industrial, agricultural earnings r's'nS
beyond precedent. Exemplifying indicauens a.
near in the universal complaint of railway nah
ayers that they cannot command equiP'ii7'
equal to meeting the demands OF trane-tl
not sudden spasmodic disclosure; but a W cona, ~,
ton for months prevailing and which aoeS Nv
grow less. . ,In-
Naturally enough. therefore. railway eqasJ qJ
ment company securities have prominehcs a., nd
show strength. They are executing ofaeIs .hs,,
making profits beyond any anticipatoh,-tHrx. , ~
will be able to disburse dividends slinlid[1s rIs
ceeding expectation. New-York AT Its
when advanced TO a 10 per cent Dividend late' ),
will be but rejecting such expansion coil.s q,
1t as representative of what is conservatNe ~, -
its group. And it will be stranse, MI IN pr,ks
market is normal again. If NewYork Air BraAs
does not cross 300
In the Industrial list there are mdi'e'. m.