Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1907-08-19
.C|.ENS ON THE SLUMP
Financier Points Out That Stock
Shrinkages Have Exceeded
Those Of Any Panic
EVIDENCE OF MONEY STRENGTH
Remarkable Conditions Show substan-
tiaI Basis Of Prosperity-shrinkaee
of $4,000, 900 in Values in Seven
Observation-Disclosures Utterances
Not to Blame.


New York, Aug. 19.-Henry Clews,
in his weekly resume of financial con-
ditions, points out some wonderful
facts. He shows that since the open
ing of the year there has been
shrinkage in stocks handled thru the
New York exchange of $3,0O0,000,O0
and what is more remarkable, this
shrinkage has not been attended with
financial failures. The money kings
themselves are to blame for this fall
Ing off in values, Clews says, and
neither is the Administrations anti
trust policies responsible for it.
THAT such tremendous shrinkage
In a little over seven months could
take place on the New York stock ex-
change without bringing on panic and
universal disaster. is almost beyond
belief" says Clews, land had any
prophet the foresight or the courage to
have predicted such results last De-.
cember, he would have been treated az
a subject fit for the asylum. Never.
theless, the fact. remains true, that
values far exceeding that of any panic
on record, and this without any serious
failures thus far. The fact that these
losses have been endured without dis
aster is remarkable testimony of
strength in the financial situation.
Losses have fallen upon those best able
TO bear them, and the causes are now
beginning to be clearly understood.
General excuses, such as the over
extension OF credit, overissue of SEE
curities and r-confidence, have been
the main and natural reasons for re-
cent reaction. OF course with the mar
ket In hyper sensitive condition in
:estors and SPECTATORS alike are na,ur-
ally more or less frightened at the
antl-corporation crusade. There have
been some rather indiscreet official
utterances concerning the govern
ment's policy in prosecuting corpora
tons; and the anti-railroad feeling
displayed in many of the states is ma
turally disturbing at this time. Moth
ing, however, that the administration
could have said or done at this time
could have checked the recent down.
ward movement. Liquidation . from
natural causes was inevitable. 1t has
peen predicted in these advices for
months past as the only means of
rlgh'lng the money and security mar
kets Whether the cure is complete or
not remains to be seen 1t is doubtful
II liquidation has yet run it's full
course, and if not, still lower pri .es
must be anticipated; altho we may
nave fair temporary recovery.
The remedy for corporation law
breakers is punishment by impris on-
ment of the guilty individuals con-
nected herewith. If the government
and state officials will announce this
as their future policy. confidence will
at once return to the stock market
and securities be in demand for in
Vestment. Corporations whose off
Gals are found guilty should also be
taxed for all legal fees and court ex-
penses. Big money fines fall mosttv
upon innocent stockholders who lave
had nothing whatever to do with the
wrong acts, hence big fines as a uen-
atty depreciate values as they threaten
confiscation, while imprisonment in
place thereof will advance them, as IL
puts them on a more reliable and hon.
est basis.
The railroad situation is somewhat
perplexing. Our roads continue to
show large gross earnings and an
abundance of traffic The latter, how
ever, is noticeably less pressing :han
a year ago and most of the roads are
beginning to seriously feel the great
increases in expenses due to the recent
concessions made to labor. During; the
first six months of the year, the gross
earnings of the New York Central in
creased over s4000,00O, or about {! per
cent, while expenses increased $65o0.-
900, Or over 20 per cent the result
being that net earnings fell off 81
100000 compared with the same hall
year of 1906 AS a result, it is esti-
mated that the company only earned
about one-half of the 3 per cent divi-
dend payable for the first half year
On the Pennsylvania system gross
earnings increased s14,2O0.cOO in the
first six months of the year; but ow-
ing to the enormous increase in oper-
ating expenses the net earnings In
creased only s1.2o0.OOo. In view of the
increased obligations which the rail-
roads have been obliged to assume or
account of new note and capital issues
it will be seen that the financial out
look from the railroad point of view
is not very satisfactory. The same
forces are at work in all parts of the
country, and if the profits of these two
typical railroads have been so SER
iously threatened, what is the position
on other railroad systems in other
parts of the country? 1t is true thai
many of our railroad securities are
now selling at such very low prices as
to fully discount any possible 1edue-
ton in dividends. but the latter ques-
ton has not yet been seriously dis
cussed."
Growth of the National idea.