The Stark County Democrat. [volume] (Canton, Ohio) 1833-1912, 1907-03-12
FINANCIAL SITUATION

| hoIe eAclJeu manner Jnan Jney nave
been at any time since the great liqui-
dating movement in 1903. The market
was, in fact, demoraliZed throughout
the week. 1t was not panicky, because
its downward trend was broken on one
or two occasions by sharp rallies, and
a notable feature of the transactions
was that they were unaccompanied
with rumors of financial trouble on the
part OF firms or individuals such as
were freely circulated at the close of
last year. 1t must be admitted, howev-
er, that the support extended to the
market was poor and that by far the
larger portion of the buying of stocks
that took place seemed to be that pro.
ceeding from the purchases made to
cover" speculative sales for the de-
cline. There were few If any Incl
dents during the week that seemed to
specifically affect values in one way
or the other.
Railroad earnings as a rule contin-
Iued to show net decreases and in some
instances decreases in gross. The
break, particularly in the Southern
Railway stocks, was perhaps attribut-
able to fears that the continuance of
the present dividend distribution on
the company's preferred shares was
impelled by the large reduction in the
company's surplus, shown during the
first seven months of its present fiscal
year. On Friday, however, the direct
ors of the Southern Railway company
declared the semi annual dividend on
the company's preferred stock at the
regular rate Of 2k per cent, and as
( has many times been pointed out re-
Gently in various columns of the Sun
the falling off in the company's surplus
in the year thus far has undoubtedly
expenditures made from earnings up
on the improvement of the company's
property. There was, similarly, sell
ing of the Erie and other stocks in
which margins of net earnings ove'
dividend distributions are not notably
large. Violent declines also occurred
in the Atchison and Southern Pacific
common stocks, due in one case to an
impression that the dividend rate on
Atchison common will not be advanced
in April, as has long been supposed
to per cent basis. No reason was
made known for the fall in Southern
Pacific and in the latter part OF tiLe
week the Southern Pacific company
made an astonishing statement of
net increase over $1,000,000 in its
earnings for January; but the drop
occurred, nevertheless, showing that
pressure had been brought to bear
against the stock for some reason or
other. AS the Southern Pacific COM
mon shares have long resisted with
firmness the declining tendency of the
market the fall in them exercised a
generally unfavorable impression.
1t may be, too, that pessimism re-
garding the money situation was some
what increased by the poor statement
of condition made by the Bank of Eng
land in the middle of the week. Eng
land is still shipping gold heavily 10
South America and owing to the ac-
tivity' of domestic trade in Great Brit
ain bank loans in the country are ex-
panding rapidly. There is, it seems,
therefore, little prospect of a reduction
in the Bank of England's discount rate,
an occurrence which some weeks ago
seemed near at hand. Events in our
own country that were of most interest
to Wall street were the passage of the
Aldrich financial bill by congress
which came to be regarded however,
as a mere academic matter-and the
continued enactment of two cent pas
senger fare legislation in different
states of the Union. This had led nat
urally to the abolition, in larger part,
by the railroads concerned Of special
privileges as regards rates of passen-
ger transportation; and it is not too
much to say that a condition more or
less resembling war between these
railroads and the people in many diff |
ferent sections of the country has thus
come into being, leading to the appre- |
hension that a reduction of freight |
rates my the railways may be enforced |
Such state Of affairs offers clearly
enough one reason for the absence of
public buying" in the security market |
People who would ordinarily irrespec-i
tive of conditions of the money mar
ket, buy railroad stocks for invest
ment or speculation after such declines
in them as have been recorded are
deferred from doing so because of ig-
norance as to the basis from a po-
litical point of view, from which rail
way investments must be hereafter
regarded.
Taking the course of the stock mar
ket throughout last week and during
the last seven months it must be said
finally, that it inevitably suggests a
comparison with that of the famous
year 1903, and these comparisons were
indeed commonly made last week in
the financial district. Two things, at
least, are plain, that the decline in
stocks from the high point of 1906 has
already progressed nearly if not quite
as far as it did in the liquidation of
thTsaa wars 400 and that n haS haan |