Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-12-12
BULLS AND BEARS
Special pIsrsleh to The star.

Sttriat DtsnaiFb 10 Inc star.
NEW YORK. December Southern Pa
citic preferred has now declared three semi
annual dividends of 31s per cent each.
There is 500. $50 $40 outstanding, which was
issued In the. summer of 1904. and it would
seem to be about time that the stock ad-
vanced from the anomalous level on which
1t has sold ever since ii was put out. Its
highest price TO last night was 12Ifs made
in February last. and except in the first
week of its existence II has not sold below
ll3s. At last nights closing price, 121. It
Yields more than "a per cent. BY the terms
OF issue 1t is entitled to per cent nom
cumulative dividends, and with the common
stocks. divided prospects what they are the
integrity of the preferred dividend seems
assured. Moreover, the preferred stock is
convertible into the common at par at the
option of the holder. and at present prices,
especially In view of the dividend yield. the
purchaser of the preferred stock gets
very cheap call on the common. The only
dra wback to the speculative Wall street
mind is the provision which enables the
company to retire the stock at rs. this
privilege to the company running from July
last to July I. 1910.
The fact has been pointed out before,
but is worth noting again, that to retire
the stock al 115 means that the Southern
Pacific would probably pay a ridiculously
exorbitant rate of interest the proceeds
of the issue, This stock was sold at par.
Since its issue there has already been de-
clared on it total of 10t. per cent In div
fdends. If the stock should be called before
July ] next the interest cost on the pro-
ceeds of the issue would average about
1.A per cent year for the two years of
its existence; should 1t be retired in the fol-
lowing year. the full dividend being paid
meanwhile, the interest cost would average
IL per cent. and so on. If IL Is retired in
1910. the full dividends being paid. the in
terest cost for the entire period would eX-
coed 10 per cent
Ii would seem 10 be quite within the range
OF probability that a new Issue of 4, . or q
per cent preferred stock may be offered in
exchange for the present stock on favorable
terms, but retirement according to the
terms originally provided is hardly reason
able to expect. The Union Pacifie's annual
report published last week shows that on
June 30 last there was a total of S2l. Ji9, $40
of Southern Pacific preferred in the hands
of the public and that the Oregon Short
Line owned S1S.0W,000. pledged p;tri Of
the collateral under Oregon Short Line re-
funding 45s.
There is no reason to suppose that Il. H.
Hartman will allow the amount of South
ern Pacific preferred admittedly held by
Union Pacific interests, almost 30 per cent
of the total outstanding tand undoubtedly
very much more If the amount in the hands
OF MI ftdTTiIEdH anu Ills ITlcliuS l. III
ciuGed) to be an occasion for loss.
II
One result of all the agitation against re-
batting discriminating rates and deadhead-
ing should be TO swell the ratio of increase
in railroad earnings next year, IL thers has
been much rebating in late years.
Two Interesting points were touched on
by Bartlett Frazier & Darlington In their
market letter issued last night They said:
1.-THE showing made by Union Pacific in
its annual report was remarkably good and
very much higher prices are expected for
the stock. 1t must be said, however that
those who are most intimate with the af-
fairs of the company and who expect higher
prices eventually deprecate the sudden au-
vance today. They contend that 1t accom-
piishes little good and makes the technical
position of the stock weaker. The trading
In Union Pacific alone was fully one-nfth
of the total transactions Of the day.
1.-The range was about two points, but the
early advance was accomplished IN very
quick time. We suggested this morning
that Secretary Shaw was disinclined to est
the legality of his own ruling that Internal
revenue funds. of segregated anu distn,
guished from customs, could be covered
into the treasury and afterward Withdrawn
and deposited with the national bank de-
nository We have received partial con-
firmation of this from an excellent source,
but it can be stated very positively also that
the Secretary will not permit any panic
and he will undoubtedly act promptly IL
there is an actual menace TO business IN
the money situation"
tin was ;out this morning that the
Gupyenheim interests would move up the
Mexican Central issues. Guggenheim is
name to conjure with in Wall street now.
Of he ir9n e.
mand for money abroad. demand made
excessive by the strain of the events in Rus
STA. was afforded today by the advance in
discount rates in Sweden and Norway. The
Imperial Bank of Sweden raised its mini
mum rate of discount to 51a per cent from
per cent The last previous change made
by the bank in its rate was on September
2l last, when it raised to 8 per cent from
41h per cent. On February last the rate
was reduced half of l per cent to IA per
cent The Bank of Norway has advanced
it's rate half of per cent to ol2 per cent.
The last previous change Dnade by the bank
in its rate was on June 10 last, when 1t was
raised half of / per cent to per cent.
4 =
Advices from Pittsburg say that ali pre-
yious records in the expectation of iron and
steel were shattered last month, when the
United States Steel Corporations shipments
through this port and other eastern sea-
board points amounted to almost 5000 tons
of various material to almost every coun-
try in the civilized world In addition to
these big shipments Of steel billets, beams,
blooms, hoops, galvanized iron, steel rails,
wire wire nails and iron pipe, manufac-
tured in the Pittsburg district, large lots
went overland to the Pacific coast for ex-
port to the far east.
The billet shipments. the largest ever
made in one month, were chiefly to Eng
land, while the principal rail shipments
were to the Argentine Republic and Mexico
South America and Australia were the
heaviest buyers of wire. The nail consign-
ment went largely to the united kingdom,
and Cuba was the largest customer for iron
pipe.