Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-09-16
Financial News Letter
81 ". @. NICHOLAS.

/ the stock market through the pending Pc
Rod Of money stringency without an enforced
| liquidation Of either stocks or bonds With
the active aid Of willing Secretary Of the
| Treasury supplies OF funds are being tenn
porarily reinforced by resort to an arti-
ncially stimulated gold import movement.
Artfully clothed explanations do not. how
| ever. disguise the fact that the money thus
| brought in is borrowed and not In settle
| ment OF balances-borrowed to prolong
| speculation, in the desperate hope Of land
| ing the public with the hitherto undistrib-
| boxes Of the banks. trust companies and
| underwriting syndicates. The manipulated
rise in the market has sufficed to mark up
the price of tho goods. but it has not yet
! been considered safe to undertake the work
Of wholesale distribution, although several
| feelers In that direction have been engi-
| neered. On each occasion the unpleasant
l discovery has been made that whenever
| muscle support is withdrawn quotations
melt away. This experience Is discourage
ing. but the cliques are in the uncomfort-
! able position of the man trying to hold q
| wild buii by the horns-he had to stick. To
let go meant death or mutilation. AS long
as the foreign gold and syndicate credit
hold out the combines may continue to
draw on alien stores Of the yellow metal to
fill the holes made by demands to finance a
| trying situation. That recourse exhausted.
there will still remain the treasury of the
United States Secretary Shaw has shown
| that he breads disturbances and pancs.
and will do anything within reason to avert
them. He Is therefore relied on to come to
| the rescue with official action IL worst
comes to worst. With these agencies at
| command. and others. 1t is the hope Of the
syndicates and cliques and combinations
that they may weather the storms OF the
| comings weeks and navigate into safe har-
Dor. The outlook Is squally, and If they
! win out it will be a triumph Of skill. nerve
and luck. The financial resources OF the
| country are being taxed as they rarely
80 1NU,lrvt Ia
Ultimate demands and finance the stock
market and the speculative enterprises in
| every direction and quarter. The whole
country is in a riot OF speculation and
plunglng on money-mad schemes. By con-
cert of action among the strong banks OF
| several cities building operations have been
checked. but beyond that little Roadway Is
making to stop the craze Of rainbow chas-
| ing. The speculative situation is distinc-
lively dangerous.
When in doubt as to the identity of the
man behind the gun in any particularly big
or mysterious Wall street campaign it Is
| the present habit to name Henry Clay
Prick as the guilty party. Mr.. Frick Is
probably the heaviest individual operator
in the stock market. and his interests are
as diverse they are extensive. He occu-
pies the unique position of being on close
and confidential terms with more big people
than any man now on the stage OF active
| affairs in the street. and he Is consequently
directly and personally cognizant with
| about all that is going on worth knowing.
| He Is at the elbow OF every Wall street OPP
portunity, and as he has a bad case of
| '.gambielust it Is easy to guess the result.
Mr.. Frick is the acknowledged head Of the
United States Steel Corporation. His word
\ is law there. He outranks President Corey.
Executive Chairman Gary and all the rest
| Of them. He dominates the factions. and IS
| the only living man who can keep the huge
machine running smoothly. He combines
| the politician the financier and the practical
| iron man. and all these on broad and
commanding scale sufficient to gain and
hold the respect Of the giant captains Of
finance and industry, many of them rivals
| and Ill friends. Set ]. Pierpont Morgan. H.
H. Rogers, Jacob H. Schin and E. H. Har-
riman down in a room together, and the
chances are they would be at each others
| Threats in twenty minutes. Yet. with Mr..
Prick as the intermediary. they can get
! along pleasantly where their interests run
the same way. The qualities that have
placed him in this position stamp him as
remarkable personality. and give him the
| right to perform on a titanic scale.
i.
Wall street Is. taking keenest interest in
political developments. centering attention
chiefly on the evolution Of the Hearst move
ment. People Of the financial district would
give a good deal to know whether the dem
onstration is a furry or ground swell.
Upon that vital point everybody is at sea,
and persons whose opinion is worth any
thing confess themselves utterly unable to
reach an intelligent conclusion In the prem
Uses. Most men of affairs would like to dis
miss the possibility of Hearst success as an
absurdity,. but at this writing the case ad-
mits Of no such disposition Mr.. Hearsts
chances of being elected governor of New
York are Infinitely better than his initial
chances Of being elected mayor Of New
| York city last year, and everybody now
| fully believes he honestly received more
fho HuhO hold IA
| Is not clear how honest people are going to
be hurt by Hearsts elevation to the execu-
| tive chair at Albany or substantial inter-
ests jeopardized, but none the less there Is
a sense Of uneasness over the prospect Of
| a great political change such as Hearst
| victory or near victory would signify.
The one bold. uncompromising threat held
out in the Hearst movement Is an over
hauling OF the state banking and trust
| company laws, coupled with q certainty OF
| a thorough inquiry into the relationship be-
| tain buccaneering. speculative combine atoms
| in Wall street Enough was brought to
light during the insurance Investigations
| to show unholy alliances OF that sort. and
| 1t sends a chill down the spine to think OF
supplemental disclosures along the same or
kindred lines. This Is one Of the things
likely to have a marked influence should
! the campaign take on a complexion indica-
| tive of radical political revolution in local
or national affairs. Politics are almost GER
tain to be a live factor between now and
NOvember-anQ against prices.
~
| The Great Northern steel trust ore deal
illustrates beautifully the creation Of val
ues' The basis Of the deal is a deposit Of
ore in northwestern Minnesota. supposed to
contain 10000 GOO tons Of iron. In an I'M
disturbed state the iron Is practically val
ueless, and would remain so. Dug out Of
the ground and used by the steel trust. it
turns a manufacturing profit and fur
nishes tonnage to the railroads and steam
chip lines. The contract between Mr.. Hill
and the steel trust vitalizes an inert mass,
and imparts to it money value Of more
than S1O0O00O00 This value 1t Is proposed
to capitalize and distribute among the
shareholders of the Great Northern rail-
road, thus enabling the owners to realize on
the "fnd'-to discount the future. as the
phrase Is. To produce 100000 COO from
nothing beats making two blades Of grass
| grow where only one grew before. It Is
modern magic, sure enough.
The hot tip was In general circulation for
three weeks that the formal announcement