New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1906-05-28


conducted on an enormous scale. on the theory
that huge expenditures will be more than offset
by the increase in traffic that will develop as
z result of present construction work. and the
mere fact that in the last few years the CAPT
tai stock has been increased from S1OOoO000O
to $500 100000, to say nothing of big bond and
note issues, including S1OO000,OO0 in the last
two weeks does not appear 10 induce the be-
lief on the part of the Pennsylvania manage
ment that obligations are being increased at a
more rapid rate than justified by present or
future earnings.
Wall Street, however. is bearish on Pennsyl-
vania stock Banking interests identified with
the property were practically compelled last
week to put supporting orders in the issue. in
order TO protect it from serious slump In
addition TO the unfavorable opinion created by
the company's new financing, sentiment was al
fected by the disclosures brought out IN the IN
terstate Commerce Commission investigation.
Even Wall Street was shocked TO learn of petty
graft in the ranks Of the great Pennsylvania
company and the speculative community be-
gan to wonder if there any truth in the re-
port that worse conditions would be found if
other cornpanies-the New York Central. for in
stance-should feel the official probe OF course.
No one IS worrying about the Reading as that
company, Mr.. Baer says. is model OF virtue
and above the reproach Of man. Reading
shares In fact all the coal stocks, were features
last week that attracted attention. and IN eX-
PLANTATION of their advance the w1ld statement
was made that S1.OO0,OOO'OOO coal combination
was to be made just soon as the plans LOT
the dissertation of the railroad coal carrying
companies from the mining of coal could be &C
conplished- The coal roads in the future must
the Hepburn Rate bill says, separate themselves
from mining COAL but if the companies decide
Of ha q
deprive them of their property it is likely that
thew will comply with the law in manner
which will in no way upset the real relations
hstveen the railroads and the mines. Most OF
the coal stocks are selling at fancy prices
nr,ces that are not warranted on the investment
return of the issues.
Conditions in the world or business present
every reason for cheerfulness on the part OF
holders of American securities and the 1acI
that investigations are being made into cor
porate management, that bad spots are being
exposed thus forcing reforms eventually Will
strengthen the confidence Of the public In their
vested possessions. The rottenness that existed
in the conduct of life insurance companies was
exposed and reforms followed. And the same
movement is now extending to railroad and in
dustrial corporations. to the advantage and tut
ure security of the owners of investment issues.
These Investigations may furnish spectators
Temporary ammunition for attacks values.
but their results ought to be far reaching and
serve to protect more than one company against
the danger of distressing troubles at some later
time, as bankruptcy. for instance, as happened
in the hard times OF the 1898 period when. with
the development of business depression, many
companies that for years had been dishonesty
managed forced to the wall Railroad
earnings are heavy and stockholders want the
benefit but not at the expense Of the property,
and, fortunately, in the greater number of in
stances. railroad managers are using their posi-
ton and the heavy traffic receipts in a manner
best calculated to strengthen the intrinsic value
of the investors holdings
Earnings for the first week in May for roads
reporting increased more than 10 per cent, while
Tor the second week there was a gain nearly
as large. Big traffic receipts and heavy bank
clearings are direct indications of trade activ-
ity that cannot be disputed, while the same
thing may be said Of the strength in the copper
market, which indicates a tremendous demand
for the metal for use in the trades Consump-
ton OF copper is running close to production
ana at the moment there is suggestion in
the character OF business that there will be
any decided let-up in the summer months
Manufacturers Of wire and electrical equip
rnent continue to place large orders for copper
for delivery in August and September on the
basis Of 1885 cents Special brands Of lake metal
sold last week at 10 cents for June and July de-
liveries and 1S% for August and September
shipments In the iron and steel trade enor-
nous contracts for rails for delivery in 1907 are
reported but in some other finished lines condi-
tons are not so favorable, buyers at the mo-
Tnent showing no great eagernesS to come into
the market The pause, however in some de-
partments Of iron and steel is not of much sig
nifcance, when the actual volume of business is
compared with the production and consumption
at this time in other years. business as a ruIe
now being heavier than ever before reported