New-York tribune., 1907-11-20
STOCK MARKET OPERATIONS.

Liquidation or securities on q moderately
tive scale was responsible for lower prices in
yesterdays market, declines of from to points
being common throughout the list Of prominent
issues The closing out OF loans was factor
that had much to do with the selling and the
operation naturally attracted pressure from the
professional element, the transactions of which
were directed with especial aggressiveness
against the Rock Island shares and collateral
bonds, st Paul. Union Pacific, American Smelt-
ing, Missouri Pacific New York Central, North
ern Pacific, Pennsylvania, Reading and the
United States Steel stocks and sinking fund
bonds. Evidence of forced liquidation in the
Rock Island securities, particularly in the after
noon, eXerted adverse effect upon the entire
market, but the selling was not accompanied
by Unfavorable news regarding intrinsic condi-
tions the movement that started the general de-
cline being based on troubles of individuals
rather than the position of the corporations
represented Rock Island IS lost net 3 points
and the United States Steel sinking fund 5s
"a points. while Rock Island preferred lost 3lk
and United States Steel preferred pa. Weak
ness in St. Paul and Union Pacific appeared TO
be on the same character OF selling that has so
long been noticed in these issues, and Street
sentiment on both stocks was decidedly bear
ish, talk in commission houses suggesting the
Idea that some members Of the financial COM
munity believed dividends on the shares would
be adjusted to a lower level and that the Union
Paciflc's securities segregation plan would not
work to the benefit of the stockholders. Many
people in the Street would like to know how the
Union Pacific bond syndicate Is faring these
days. Doubtless with more than $4,000 600 Of
the bonds on its hands It is not feeling exactly
cheerful in this time Of financial uncertainty.
Much confusion of opinion over the probable ef-
feet Of the governments proposed relief meas
ures upon the situation doubtless had some
thing TO do with the bearishness that appeared
to prevail in most ections of the Street but as
far actual financial conditions We're concerned
signs Of improvement were reflected in a quieter
demand for currency. in lower rates for call
loans and in a decline In sterling exchange.
Gold TO the amount Of s1500,000 was engaged
for import, bringing the total on the current
movement to about s6s,00O,0 600 Closing prices
on the Stock Exchange as a rule were a trihe
above the lowest. Loans Of the Clearing House
banks are $100.00o.000 in excess Of deposits. A
readjustment Of the loan account will mean
further liquidation in securities. And life in
surance companies still have hand stocks
that according to law must be sold.
Railroad earnings beginning TO feel the
effect Of the lighter volume of trade that is
noted in various parts OF the country the
suit of the retrenchment and curtailment policy
adopted by the greater number of industrial
concerns, but it is not thought trade reaction
viii run extent that will cause material
general dividend reductions The recent panic
and the monetary stringency naturally will af-
feet the railroads, and II is not unlikely in the
case of some roads that have increased their
dividend rates conservatism viii suggest to the
directors the wisdom Of paying less to the stock
found the current quieter tendency in the
try's business is to be a matter of a short time
only. It should be borne in mind that the rail-
roads are in a stronger position to meet ad-
versity than at any preceding time in their his
tory. Smaller gains In earnings now compare
with enormous gains in the last few years. and
in the majority of cases recent big dividend dis
tributions have not trespassed upon the margin
Of safety as far surplus account has been
concerned The railroads are in better physical
thop pxyqF net
through a period Of physical readjustment they
have increased their earning power, they have
been preparing for future growth in the coun-
try's population and industries and they have
been managed to the end that they go
through times OF distress without going into
cevers' hands In 1898 the transportation COM
panies not in physical or financial posi-
ton to meet the business troubles OF that time
without in many cases, defaulting on their
mortgage obligations, while at present their af-
fairs furnish as a whole ample encouragement
for the belief that their stockholders are not
confronted with a period OF impoverished in
comes.
Recent annual reports show that the Atchson
had surplus after dividends of s9805.002; Bal
timore & Ohio. s2.915440; Canadian Pacific,
O05; Northwestern $7,S3O.389: st. Paul,
s3662,14S; Northern Pacific s12.623.929: Penn
sylvania, s71OS,166; Reading sS,141453, and
Union Pacific, $10S53,000. The Pacific Coast
Company. which operates both railroad and
steamship lines, showed by fits report surplus
after dividends of s470S40. but to this should be
added other credits to income account, as, for
instance, $609797 from sales of real estate,
which actually make the net surplus carried to
profit and loss account after dividends 81 500 137.
The United States Steel Corporation in its
port for 1906 showed a surplus after dividends
of s62,742S59, and IL Will make better exhibit
for the current year ending December 81. The
results enumerated furnish some of the best
examples of what corporations have been
doing in the way OF earnings and they ought TO
serve to increase confidence in the well grounded