Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-05-07

.TFffTTf $500 TT
The very sharp decline in security prices
which Wall street has just gone through
was scarcely unexpected. but it was prob
ably more severe than anybody outside of
certain Boston literary circles looked for.
Wall street discounts" everything. but 1t
has, nevertheless, curious habit of being
surprised when its predictions come true.
This probably comes from the recognition
that 1t Is American and therefore apt to
exagEerate, or because 1t knows that
chance so often knocks the best-laid plans
into cooked hat, that it rather looks for
chance to do ungentlemanIy things on the
slightest provocation. This is true of the
high as well as Of the low. When Mr.. Har-
F1man and Kuhn, Loeb Co. undertook the
rehab utilization of the Union Pacific road a
few years ago they were confident that the
country was about to enter into q period Of
great prosperity. But they were more than
surprised when the good times came, be-
cause they were much better than they had
really expected.
A generation ago. when Mr.. James J. Hill
started in to make railroading one of the
exact sciences, he permitted himself glorious
dreams of what the northwest would be
some day. The Great Northern road was
his religion. He has made it his monu-
ment. worthy Of a great dreamer as well
as Of great builder. His poets mind
AOi AC udS Oue-VlSIOQeO q pOQuiOuS ana
prosperous country in lieu Of hundreds of
miles OF wilderness. His vision reached
across the blue Pacific and saw a mighty
trade with the orient. And because he Is
practical poet, as it were, he likewise
caught glimpses ever and anon of some
golden dollars coming his way. But that
he ever expected to be the owner, among
other things, Of some 100000 shares Of a
STOCK worth 500 share is to be doubted.
Mr.. HilPs friends will say he probably never
thought about money, but / prefer to- think
Of Mr. Hill as human being living today
Mr.. Charles NJ. Schwab, who is in reality
mucn misunderstood and greatly underesti-
mated man, has time and again in the past
eighteen months told his intimate friends
that he felt certain United States Steel
common stock would in very few years
great steel expert, and he firmly believes
what he says. In the enthusiasm of the
moment some of his friends believe the
same thing. But there is not one of them
VINO Will not doubt it time and again be-
fore that day comes, and all of them will
be surprised by 1t, Notwithstanding all they
may say.
Recent Break in Prices.
1t Is the same with the recent break In
the stock market. 1t was of a familiar
enough type 1t has been seen before many
times. 1t will be seen again. But even the
bears who looked for 1t, and, 1t may be.
even prayed for it, were scarcely ready for
1t. Among other useful things, it bore out
sundry contentious set forth In these arti-
cles For example, it showed those who
said the public had no stocks to have been
mistaken by few hundreds of thousands
OF shares. Also that at times the upward
progress of stock prices is more rapid than
the progress toward Improvement in under
lying business conditions; in other words
that the discounting of future prosperity
Is overdone from time to time Hence
these tears of the overoptimistic
AS rule, stock market post -mortems arc
seldom really instructive. The man who
has lost Is in no mood to listen to calm
analysis or the why's and wherefores. The
money is lost; the analysis won't bring it
back. Moreover. if he did listen, he would
forget 1t in month. But curious fea-
ture of the after discussions is the differ
ence OF opinion between the two great
classes of Wall street Professionalism
vast army of spectators or traders" and
the dozen constructive fnanciers" Just
before the break very shrewd trader, a
man who, with a daring that seemingly
borders on recklessness at times combines
a cautlousness that almost deserves a
harsher name, philosophical as follows:
stocks may or may not be too high. There
which may justify present values.
dividends and earnings may establish
the real value of security to an investor,
put there are other things besides these
Whicn must be reckoned with by the specr-
lator. Again, it is sheer nonsense to
speak of fragrant manipulation in certain
stocks by certain pools as necessarily dan
gerous TO the entire market al all times
some pools are composed of insiders and II
is always difficult to see more than an inch
OF Two up an insiders sleeve, especially
wnen ne is an insder of a corporation
whose real financial condition and business
prospects are not easily ascertainabIe by an
outsider, as, for example. Henry H. Rogers
ana the Amalgamated Copper Company
But this much can be said. that unless
some OF the deals We have heard of so much
IN connection with the advances in such
STOCKS as Union Pacific, New York Central
81. faui and others are carried through and
carried through shortly. then prices are
very decidedly too high and the market
i hiouio nave severe decline, even though
basic conditions are sound and the hnIls
ran 70 see anything to sell stocks on" He
The Average Spectator.
Inc average stock Spectator dearly loves
mystery. Tipsters recognize this and
they are SO devilishly mysterious at times