Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-07-22
Financial News Letter
BIZ ". q. NICHOLAS.

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Special Correspondence Of The star.
NEW YORK, July q. 19o6
Most traders In the stock market who
were strongly bullish when stocks averaged
twenty points higher are misrepresentation
bearish at the slight recoveEy from the In
side quotations last week. Three months
ago they could see NO reason why prices
should not keep going right up: now thsy
refuse to recognise any excuse for recovery
In market values. The mere fact that there
has been total shrinkage Of about $2000.-
COO. 600 In the quoted prices OF securities
within the last ninety days and that the
market therefore must be that much nearer
bedrock makes slight Impression. The
country al large seams to be fairly revealing
In prosperity. yet the rank and file of trad
ers cannot get 1t out Of their heads that
something portentous Is hanging over the
market. All they can see and know posi-
lively Ii that there has been heavy liquida-
ton of stocks for inside account since the
spring boom The speculative end OF their
argument is grounded almost entirely on
the chances Of tight money during the fail
and winter months, and on reasonable GER
tainfy that the political campaign this year
will be unusually fun Of ginger. with radi-
calisn in the forefront Of agitation. The
stock market Is likely to remain In profess
sional rut for some time. although forces
seem to be working for general improve
mept.
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The prospect of agitation for tariff re-
vision Is not the only disturbing thing con-
fronting the steel trust. 1t Is face to face
with the new rate law. which distinctly and
directly prohibits corporations from en-
gaging in the dual role OF manufacturer
producer and that of common carrier. The
steel trust owns LOCO. 100000 tons OF Lake
Superior iron besides ], $50 miles OF railroad
and a great lake fleet, by virtue of which it
obtains a freight advantage of 81. 40 per ton
over competitors on practically every ton OF
pig iron it uses. The steel trusts output is
now on q basis of about 100000 tons of
resents an advantage over competitors OF
about SIS 600 600 per annum In the matter
of transportation. II obliged to part with
Its transportation asset and stand on an
equality tn that respect with its business
rivals In the iron and steel trade 1t would
sacrifice In large part the advantage OF
81. 40 per ton which 1t now enjoys The item
of $25,00O.0O0 year or any major percent
age thereof would be an important matter
in the income account of the steel trust
overwhelmingly gigantic though 1t Is. In
the very first section Of the newly enacted
rate law 1t is specifically stated that the
provisions of the act shall apply to ANY
corporation and to any common
carrier or carriers engaged in the transpor-
tatfon of passengers or property wholly Dy
railroad Cor partly by railroad and partly
by water, when both are used under the
common control, management or arrange
ment for a continuous carriage or ship
ment), from one state or territory of the
United States or the District Of Columbia,
to any other state or territory Of the United
States or the District of Columbia
4
Further along In the same section IL found
this iron-toothed paragraph. which seems to
have been constructed with special view to
its application to the steel trust. although 1t
applies with equal force to every corpora
ton transporting its own products in COM
petition with the business OF the general
public The paragraph reads: From and
after May 1, 1908, 1t shall be unlawful for
any railroad company to transport from
any state, territory. or the District OF Co
lumbia, to any other state, territory. or the
District Of Columbia, or to any foreign
country, any article or commodity, other
than timber and the manufactured products
thereof, manufactured, mined or produced
by 1t. or under it's authority, or which It
may own in whole or in part, or in which
1t may have any interest direct or indirect
except such articles or commodities as may
be necessary and intended for its use In the
conduct of It's business as common car
rier."
The big men of Wall street are very gen
orally cutting their summer vacations short
this year. Mr.. James Stillman. PRE- sident OF
the National City Bank STANDARD OiD, Is
already back, and J. Pferpont Morgan Will
be at his desk In few days. John D.
Rockefeller Is scheduled for homecoming
early next month. II. H. Rogers has fore
gone his summer holiday almost entirely,
never being away from Wall street more
than three days at stretch. John w.
Gates Is located within three hours of New
York. and many other men of large aEairs
are in unbroken touch with their city Of
fees. The spirit of unrest and nervousness
which seems to infect the masses g felt
quite as keenly in the financial center as
thing else Is responsible for this all-per-
yading restlessness New conditions seem
to be forming, and fnanciers as well as
necessity of a readjustment Of machinery to
meet them. They want to be close to home
base while the new forces are in labor.