The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1907-02-07
Bear Operators Unable to
Find Soft Spots i'll Market.
BOSTON HEAVY COPPER BUYER
Unusual Earnings OF Southern Pa
cIGc Explained by Recent Growth
Of Mining i'm Nevada Fieid-TOnO-
pah Road Paid fer Out of Proceeds
of One Years Business.

ing Tor an opportunity 10 cover SNORT
have, in the past few days, made repeated
efforts 20 depress a particular stock or
group of stocks 50 that the weakness
there might be awaited of to conceal buy
ing at other points on the list In the
regular parlance Of the street, they have
been feeling for soft spots" but appar-
entity without finding any.
They tried Great Northern and PennsyI-
vania on Tuesday, and yesterday turned
their attention 10 Missouri Pacific, fore
ing 1t down to the lowest price touched
since 1901, but without starting any ap-
preciabls amount of liquidation. At the
low level of prices good buying was met
with. and those who sold short found
when they tried 10 cover that the float
ing supply was quite small This, OF
course, might have been expected, for
there has been very little speculation in
Missouri Pacific for months past, and
whatever speculative bull account might
formerly have existed in the stock was
closed out long ago, passing for the most
part into strong hands.
Officials Of the company might well be
excused had they refused to dignity the
rImors about an issue Of new stock with
a denial, but they frankly stated that
there was nothing whatever in the COM
pany's affairs to afford even the shadow
of pretext for the raid to which the
stock was subjected. Probably no one at
any time seriously believed there was.
Every raid that fails as did the one on
Missouri Pacific but strengthens the con
fdence Of the bulls and brings nearer the
rout Of the bear party.
Boston was a buyer Of Amalgamated
Copper and there was other buying of
the stock that bore such strong re-
semblance TO that observed in ST Paul
at the lowest level a couple OF DAYS
ago that the traders were much inn
pressed with H. The price moved within
narrow limits. and the final quotations
showed no change from Tuesdays clos
ing.
If the proof were wanted that the raid
on Missouri Pacific did not cause much
selling of the general list. il would be
found IN the fact that the total % trans
actions IN the last hour fell under the TO-
C9o-share mark. being considerably Jess
than half of the total for the first hour
Ii is generally regarded as q good sign
when the market gets duh on the declines
There has been so much inquiry regard
ing the source Of the enormous increase
in the earnings Of the Southern Pacific
that 1t does not seem as il Wall street
appreciates the importance Of the growth
of the mining industry in Nevada in con-
tributing railroad freight and passenger
traffic Southern Pacific has practically
a monopoly Of this business. for while
some Of the mines have roads of their
own. these in all cases are feeders of
Southern Pacific, 10 which they turn over
ali their traffic.
How profitable this traffic is may be in
feTTcd from the fact that the Tonopah
Railroad was paid for out of the proceeds
of a single years business. The T0nOpah
road is only about seventy miles long
while on the traffic which Il turns over 10
the Southern Pacific the latter has
haul of upward Of $50 miles II the Touo-
pah road could be paid f,.E oat of single
years business there can be no doubt
that ten times the amount OF business
for that is what ten times the length Of
deal, even on a system of the magnitude
of Southern Pacific.
OF course. the Touopah is only a single
instance OF the benefits that Southern Pa
cific has derived from the mining activity
in Nevada and California, for "A great
many mines have begun producing I'm both
these States in the past year and this
road handles the output of all OF them
This kind Of business will be permanent,
for whether general business declines or
not gold mining win keep on as long as
the yield remains sufficient to justify
operation.
What makes Southern Pacifcs ore
traffic so profitable is the system by
which the rates are fixed. according TO
the quality of the ore. There is no
such thing as fat rate for hauling the
ores 10 the shelters. The railroad makes
contracts with the miners to haul their
ore on Il sliding scale OF rates. according
as the yield of gold is big or little The
rates are not paid by the speculator, but
by the smelter, being. in effect. treated
as part Of the smelling charge. and the
railroad. ike the owner of the ore. must
be furnished with q certificate of the /
smelling results of each consignment. so /
that it may check Up the rates TO satisfy /
itself that it has received what it Is en- /
titled TO under its contract.
rs il is estimated that the gold OUTPUT /
OF Nevada this year will amount to about
S200C0.eOO, if viii easily be seen that this /
industry is entitled to a good deal OF /
in discussions of the ques- /
ton of whence comes the great increase /
in the earnings Of Southern Pacific
The traders wondered where all the /
stock that was sold by the specialists I
in Great Northern came from, but while /
they reached no definite conclusion on /
this point. they expressed satisfaction /
over the way the offerings We're taken. 4
The broker who makes this stock his 1
particular speciality has sold in all more
than 1l,O00 shares of it in two days and /
the buying, mostly in small lots. seems /
to have come from investors who appar- /
emily intend 90 take the stock away. for.
had any Of it been speculative, the con-
yinued selling from one source would /
almost certainly have started a dribble
Of liquidation. whereas yet nothing of
the kind has occurred. although the re-
peated attacks on the Hill roads have
not escaped their share Of notice.
Very little significance was attached 20
the resolution introduced in Congress In
he interest of minority" holders of The
stock of the Northern Pacific Railroad.
hat eleven years ago was succeeded bv
he TeorganizCd company. the Northern
Pacific Railway, for an investigation of
he latter companys title to the lands
luly taken over in the process of reor-
In the first place, the whole
question WAS passed upon by the courts
-ears ago, the title OF the present com
7any to the properties being fully Gus