The Washington herald., 1906-11-16

New YORK. NOV. lo.--Nlb TN bi ee'i1ii'7
in evidence from start TO finish the trad
ers were astonished at the strength which
the market maintained, and several brok-
ers who on Wednesday asserted conf
IDENTIFY that prices could not keep right
on up admitted last night that they were
not so sure about IL.
As there were some traders who were
taking profits, stiu stronger ones must
have been taking the stocks. for. in spite
Of Irregularities. the main tendency con-
stltuted upward.
The more narrowly the trading was
watched the more evident It became that
the stocks were in strong hands, the com
mission houses and their customers hav-
ing sold out and, in many cases, taken
the short side some time ago in the be-
lief that the high rates for money were
sure TO compel liquidation
Only a week ago everybody in the
Street heard that f. r. Hartman had
sold out his stocks on the expectation Of
getting them back 10 or 20 points lower.
Now everybody says +. II. Hartman IS
the force under the present upward move
ment in prices. Possibly the rise is the
result o. HaTriman's efforts 10 get back
the stocks he sold but nobody believes
that For fooling the public all the time
this president Of railroads and manipu-
lator OF stocks comes pretty near the
limit
IF only all the stories hear are
true, said a shTewd trader, "the market
viii go a great deal higher, but the
trouble is that I don't believe a blamed
one OF them"
While in the speculative circles, the ad-
vance in Southern Pacific is regarded as
an indication that some plan Of an ALI
ance with St Paul is under consideration, /
this theory does not meet with the ap-
pTOvaI of conservative interests. These do
not, however, cast equal doubt on the
story that a preferred stock may be grant
ed within the next few months. The ex-
pectati0n regarding such rights is that the
S50000.0o0 preferred stock nov outstanding
viii be returned in accordance with the
provision given the power 10 90 this, at
49, and that subsequently the S60. 600 900
preferred IN the treasury viii be sold TO
stockholders at par as q permanent : per
cent issue as stock not subject 10 redemp-
tion. IL is even said that the whole is
10 hc bought in, may be given with rights.
and the possibility has raised the question
as 10 what use the company intends TO
make OF tne money realized. The answer
would be easy if it We're known definitely
that only SGJO1o.Gl0 Of stock would be sold.
for {i6C0010 CT the proceeds would be re
quired TO defTay the cost Of the $40 100000
issue now outstanding. and the balance Of
I4tWt0J would be small amount 20 ap-
ply 20 betterments on a system of such (
maguitUre as Southern Pacific Consider
ing that the road IS progressive, even "A /
total OF S54C0o.oo0 might easily be needed /
20 pay for extensions and additions Of 4
various kinds 90 the property of the q7m- I
uany.
As n specimen cf the rUmors current I
the report about ST. Paul. Union Pacific. /
and Southern Pacific left nothing TO be /
desired. II was neU, complete and cir
cumstau,ial. while il concerned a deal OF
magnitude great enough to make mar
leJ No one should trace 1t to its course. /
although everybody heard It and the
greater the interest the trader had on
the long side the greater was his ap-
parent confidence in its entire truth.
IN brief the story was that Union and
Southern Pacific jointly viii lease St. .
Paul, granting dividends at the rate of
10 per cent annually on common stock. /
and that this proposition would come be /
fore the directors Of Union and Southern
Pacific for final decision on November 2S. /
In some quarters It was added that S.. !
Paul stockholders would in addition re
Ceive rights worth about SIS a share. but
this did not meet with general accept |
unce from the advocates Of the lease
theory. Whoever was interested in max I
ing the report public certainly succeeded
well, for at the end Of the first hour it had
not only reached every broker. but had
penetrated every office in the financial
section.
Among the minor stories about ST /
Paul were that the recently authorized /
preferred and common stock might be /.
used to buy control of Illinois Central; /
that the Hartman interests had made /
a long step toward controlling the prop 4
erty by the purchase Of the holdings Of 1
James Henry Smith. and of rights on the /
last issue Of stock, and would probably 4
CIinch their contract by purchase of rights /
on the next issue and that control Of Z
the road had been bought by Southern /
Pacific and would be paid for at the rate 4
OF share of Southern Pacific preferred /
and Sl00 cash for each share Of ct. Paul. /
Quite a few brokers have come to the 4
conclusion that the efforts made by Sec /
retary Shaw in the past TO relieve the /
money situation while well meaning. and .
on occasion ingenious, has been of doubt .
full benefit to Wall street. The conten- /
ton Of these parties is that when rates |
get high here they usually attract .
money from all over the country. and
that the greater Will be the movement OF /
funds toward New York when it is be- /
Ieved that nothing VIII be inteTposed TO /
settle the relations between supply and I
demand 10 the disadvantage of the lender /
Out-of-tOWn banks. il is COntended. have
NOT taken much trouble to send money
to New York at any time within the past /
wear or so, even when rates were very
high here, because they were always Un-
certain whether the Treasury might not /
at any moment announce a plan Of re-
lief and take the ground from under /
them. If country banks can only feel
sure that the Treasury will not interfere.
the next advance in call rates. it is as
serted, may bring money here in large
volume.
In view of the possibility that the
Treasury may before the end of the year
announce a plan for the retirement Of
some Of the 4 per cent bonds Of 1907, there
Is a natural curiosity to learn something
about the amount of these owned by one
of the largest banks which advertised ex-
for them few months ago.
This curiosity is not likely TO be gratified.
The bank may have succeeded in buying
large amounts. or il may not. and il is, of
course, only the merest kind Of guess