The Minneapolis journal., 1906-08-05
IRON, STEEL AND WHEAT

Easily the event of first Importance
in the past week was the declaration of
the dividend on the common stock Of
the United States Steel corporation.
This billion-dollar combination or trust,
the biggest piece of promoting our
country has yet witnessed, had it's birth
in period of great industrial and
financial activity when the craze for
consolidation was at it's heighth. 1t
was so big thing that it staggered the
country. It began with the payment
of dividends upon both common and
preferred stock and discontinued the
common dividend in 1908. More re-
Gently the earnings of the company
have increased, for the country is
highly prosperous, the furnaces are un-
able to turn out the product fast
enough to meet demand, prices are good
and the profits large. It was expected
that the earnings in the quarter just
cleared would approximate the great
total Of $40,000,0O0, and this was a
bull card in the stock market and a
general argument for the soundness Of
present conditions. When it was found
that the forty-million line had actually
been crossed and the directors decided
to resume dividends on the company s
common stock, it was matter of in
terest, not alone to the 10000 or more
stockholders of the huge combine, but
to the entire country, for the saying is
old that iron is the barometer that
shows the coming and passing Of Pc
rlods OF activity or recession, and the
general assumption was that the COM
pany feels reasonably sure of at least
several years Of continued good bust
ness, or it would not pay the dividend.
The effect of this, upon Wall street and
the country outside was beneficial.
While stocks did not advance much,
yet many felt the steel announcement
to be the forerunner of other good
things to come, and were turned away
from timidity to confidence.
It is interesting in this connection to
note the theory Of a writer in the Wall
| Street Journal, who has sought to draw
| a comparison between the iron trade
of the country and the wheat crops
two things that would not be supposed
ordinarily to have much connection.
He is able to show by comparisons over
a period of years that when the conu.
try produced big yield Of wheat the
pig iron production ran up correspond
ingly and when the crop was small, the
iron industry languished. It is a fact
that in the period between 1897 and
1905, when the country produced or
the average 620,000,OOO bushels Of
wheat and 2,16o, 100000 bushels of corn
the production of pig iron ran up from
9,652,O00 tons to 22,992,000; that in thu
year 1904, when rust visited the north
west wheat fields and the total whea
crop of the country fell back. from 637,
100000 to 522,OOO,OOO bushels, pig iro1
i production declined from 1s,0O0,0OO t.
/ l6,497 900 TONS, and when in 1905 tn!
wheat crop came up again, to 693, 900,
1000 bushels the pig iron tonnage in
/ creased to 22,992,000. How much in
! dorsement an iron trade expert woult
4 give this theory is uncertain, but i
4 looks reasonable. Hence, if iron an,
steel make the country s prosperity, a
! some Of the shrewdest of the old-tim
fnanciers have said,c and if iron. an
1 steel are prosperous in year when tn
crops are big, then greater things thai
4 any yet seen would appear to be il
store for the industry, for from all re
/ ports received to date, expectation Of
4 large wheat crop and Of good crops o
corn and other cereals is warranted
The railroads Of the United State
will use this year 3,5oO,000 tons of rails
which will make new record, and
is estimated by men in. the busin:es
that there. will be. 100000 railroad car
turned out by the manufacturing com
} panies, one company alone having OF
ders on it's books for 1000. @ z
With big crops affording activity 70
the railroads and stimulating bushes
generally and industry active in a
be shaping for a measure Of prosperit
even greater than that already seen: