The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1906-12-31
STATES AWAKEN
TO THEIR POWERS
Roots Speech and Suit OF Mime
sofa vs.. Great Northern
Responsible.
CONDITIONS ARE OUT OF JOINT
Business Is on a Boom and All the
Millions Sent Out Have Been
Quickly Absorbed.

lDy Louis Guenther Editor Financial
Worid1
NEW YORK December 3V-The propa-
ganda IA favor OF enlargement OF the
Federal power az the expense OF state
rights started by "A recent sensational
speech OF Secretary Root, has. uudoubted-
ly. been prompted by the doings and
abuses % corporations created oy tu-
states The great corporations which
nave formed powerful combinations and
trusts. have been creatures OF the differ
ent states by which they have been
chartered The question is undoubtedly ln
order whether the States have done their
iAh duty ia supervising these corpora
tions
All States have more or less defined
statutes Tor the regulation of tla powers
az their creatures. the corporations and
fet Nety FEW States have so far shown
amy inclination 10 assert themselves in
this regard.
An awakening Of the state govern
ments % their full power and duty may
o. the means TO stop the sentiment i'm
favor - an enlargement Of the Federal
authority. and from this point OF View
the suit of the State OF Minnesota for
n permanent Injunction against the Great
northern Railroad To prevent 60 from is
suing additional stock OF $4,000 000 until
Il
70 state ofhcials. may have salutarv
effect IN arousing other states 10 fully
exercise their constitutional powers
ia its bin 90 complaints. the state ~
Mianesota states that ~ the Great North
ern increases its stock from SEQ 000oo0 10
S-lo01pD and Keeps on paying annual
dividends ~ the rate OF per cent on
AT its capital stock. the dividend require
ments viii d. increased from SlO.5Oo.Oyl 10
St'h"io. great portion Of which will
nave CD be paid by tho Minnesota patrons
az th- rel. odd in form % increased
freight ana passenger rates.
II the Great Northern Railroad has
carefu.lv considered the necessity q am
increase in its capitalization and mas
well defined plans what o. do with the
additional millions. there SIS 30 reason
why ~ should not show them TO the
state az Alinuesora- The whole question is
simply an issue between the state MS
me creator Of corporation and its c-ea-
lures
By asserting their present constitution
al rights, or by passing new laws for "a
more effective control or corporations.
the states can best silence the agitation
for an Increased Capitalization OF Fed
eral power. q move contrary 10 the his
toric evolution Of our country. The suit
or the state Of Minnesota may therefore
be OF far-reaching Importance and a
step IN tie right direction 10 maintain
the constitutional equilibrium betwee,
state rights aud Federal power.
Unprecedented Market Puzzles.
Probably the oldest living man cannot
remember time when economic cor.di-
tons and stock market features have
peen 50 nagrantly out Of joint as they
have been ,n 1916.
In trc wear of the greatest commercial
expansion and % exports surprising the
imports hv nearly half billion dollars. I'm
FACE or the highest copper metal prices IN
the past twenty-five years. and the IN
creased prices OF iron and steel products
the stock market. where values are made
hy earnings and dividends falls to re-
fleet this condition. and stocks on the
average are lower than they have been
when there was less activity in trade ana
industry. less increases in earnipE and
smaller dividends.
There are two explanations for this
/ condition: the lack Of funds TO speculate
/ with and the entire absorption OF our
business world in its various occuratioils.
And this may prove 60 be a good thing
for the nation for the less IL speculates
and tie more it works, the better off
is IT,
How tremendous business IS. is shown
| by the fact that it has absorbed all the
millions with which the treasury or the
United states has come TO the relief
or the money market during 1905
The enormous output OF gold in this
| country for the year, amounting 70 over
Sl.0oooe0, has not been absorbed by Wall
street. but by legitimate business. And IL
p snare or this new wealth has heeu
diverted To speculation it has I.lped onfv
mining and real estate booms wall
street has had but meagre share OF Il.
InduStrials Fail to Attract
Even to greater extent than railroad
stocks have the stocks Of our industrial
! corporations failed 20 express conditions.
TIE industrials remain the most neglect
ed OK all and, yet. this can hardly remain
so for any length Of time
IT is generally expected thar vvifb +ba
beginning OF 1907. millions used for NOV
ing our crops and financing trade and
industry or withdrawn from hanks 20
sausfy holiday deman,. Wall begin To- .so,,
BACK TO the money centres. ana NOV
start the great bull movement for which
Mau Street has been waiting I'm vain
for 50 long.
What has been going on I'm the stock
i'aAhet since the san Francisco disaster
was plainly OF professional character
Rich men and powerful pools havo 81
cumulated enormous quantities OF stocks
part OF which they put out when pro-
ltsslonal traders were led to beIte,-a
that bull movement had set I'm and
'leh these stocks are bought back hv
the Dig interests at lower prices. when
tne professionals had been shaken down
Inc markets have been dominated nv
speculations I'm Reading. Union Pacific
81 Paul Northern Pacific and Great
Northern stocks. IN which onlv the
wealthiest can afford TO dabble
These stocks have been put up when tho
street clamored for higher prices or
whenever short interest was Discovered
or put down when everyone on the street
was overloaded. For big interests ba,,a
stomachs TO feed. clothes 10 wear ana
families to keep, ana consider themselves
entitled TO "A little profit
What the Big Interests Antici-
pate.
The powerful interests which don,fnata
corporations. control railroads and mako
stock markets. are undoubtedl, ovnec, .