The Washington herald., 1907-01-16
WALL STREET NOTES
James ]. Hill Is Bnll on Steel
Corporation Stock.
SEES GOOD BUSINESS COMING
Necessity for Great Expansion of
Railroads viii Result In Growth
Buys for Quick Turn-Traders Are
Now Selling AmaIgamated Copper.

of Rail and Iron tDdustrles-NeVeF
Buys for Quick Turn-Traders Are
Now Selling AmaIgamated Copper.
New York. Jan. I5.-The statement
made by James J. Hin in his letter 10
the governor Of Minnesota to the effect
that the railroads, in order TO catch up
with the business Of the country. woulf
need TO spend Sl.l0O000.0oO a year for five
years was not made without mature de-
liberation, Ror does it represent merely
the personal opinion Of the president Of
the Great Northern Railway II can be
stated definitely that when Mr Hill was
here last fall he talked the matter over
with number Of railroad people and
others, whose opinion ne valued, and the
consensus was that To adequately pro-
vide for the business in sight to-day the
railroads of the country would need an
addition of about p per cent TO their
present trackage
The present mileage Of the railroads of
the United States is in excess of 2OO.O0O.
miles, with the necessary increase in IA
cfities of other kinds. would require all
of $5.000G,o.050. But no one more fully
understands than does Mr.. Hill the i'm
possibility of raising any such sum even
within a period Of five years, especially in
view of the attitude Of State legislatures
and Of the Federal government toward
fully the labor shortage. which makes it
very difficult for the RAILROADS to get a
supply of men sufficient for their ordinary
purposes, not 90 speak of expansion of
the vast scale which he believes Is re
quired by business conditions.
At various times within the last few
months the street has heard rumors that
51r. Hill has become very bullish on Steel
common. and there is little reason TO
doubt that from the purely investment
standpoint this is quite true Holding
such views as 10 the need of additional
railroad facilities as Mr Hill holds. il
would De practically impossible for him
10 feel otherwise than bullish on the out
look for the steel industry and the posi-
uon of the Steel Corporation. especially in
view Of its improved condition through the
possession OF new ore properties whose
value he understands SO well.
Mr.. Hill never buys stocks for a quick
turn. He has always said that he knew
nothing of the art of stock market ma
nipulation. but in figuring out values even
where Wall street fails 10 recognize them.
d.. a.
value OF Steel common 10 his own satisfdc-
ton. and the value which he has discov-
cred iu IL is much higher than Wall street
has put upon b. but he makes no effort
60 predict when the stock market viii get
around 10 his view Of ihe intrinsic worth
OF tae security. lie could not make such
predictions and be consistent.
That there are any other bulls on Steel
common of the same kind as James J.
Hil would seem to De a fair inference
from the action of the stock Expectation
regarding the forthcoming dividend is
against rather than In favor Of an increase
IN the rate. and yet the stock shows
strength the market for IL being at AN
times substantial enough 20 absorb offer
irgs without yielding much. From the
purely speculative standpoint. il IS doubt
f1l If an increase in the dividend at this
time would be best for the stock
III the rate were raised 10 pev cent.
the bears would bc present To argue that
the good news was all out. that il had
already been discounted and that the
corporation was thereby brought under
the necessity Of borrowing To- complete
the work OF progress, which up TO
this time has oeen provided for out of
earnings.
In other words. the declaration OF an
increased rate might open the way for
bear campaign. whereas If the increase
Is withheld until April the means OF pro-
viding for betterments viii be supplied
from earnings and the bullish ammuni-
ton saved for use at a time when It's
effect might be greater.
This, of course. does not mean il viii not
be ia any way influenced by the possible
effect Of their action on the stock market
but it shows that II for reasons affecting
the company the present low rate Of
dividend should be adhered to for three
months longer, Wall street would not be
unit in regarding it as bearish on the
stock.
TO HI with the coaI-Tm buH on the
stock" was the sentiment uttered by
one Of the Reading bulls when his atten-
tiou was drawn TO "a report that several
mines had been closed on account of the
mild weather With Reading bulls, in
trinsic considerations do not count.
Traders sold Amalgamated on the
ground that the dividend was not likely
to be increased and that the price was too
high for an s per cent mining stock. even
if the directors should substitute a flat
rate for the present basis of regular
and extra. They said there was little
real support and yet it was evident that
there was something more than short
covering presented in 'the- buying that
took care of such a large quantity Of the
stock around 119.
Large interests have been talking in
a buliish strain about the stocks merits.
while declining TO commit themselves TO
any predictions regarding the next divi-
dend. and there are now some bulls on
the stock who say that while Boston and
Montana may follow Anaconda in in
creasing its dividend. stockholders of
Amalgamatcd may have to content them
selves at this period with a demonstra-
ton Of what the company can do In the
way Of increasing its payments at future
times after certain plans have been car
RED out
The theory that the buying of Southern
Pacific represented nothing more than d
speculative operation by a house of the
,-,9 .,-, e,,s.4sla xro G. co puriroIv ar " ri
ance with the sustained strength of the
stock that it is doubtful If even those who
propounded it retained their faith in it
10 the end of the session Perhaps what
was worth more attention was the fact
that the buying had some points of SINH
larity TO that seen in the stock at the