The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1907-03-16
MAIL STREETS FURRY.

!
country has made from the epidemic
of legislation hostile to railroads and
corporations which has swept from
one coast to the other this winter. In
actual decline of securities the records
Of Wall street show a loss of humid
reds of millions. Prominent copper
mining stocks alone. the kind that
earn and pay big dividends. have fall
en- over $50 900 since January L
not because of any depression in cop
per. but because the wave of punitive
railroad legislation frightened inves-
tors, made capital timid, cut off the
supply OF money needed for con-
templated improvements and caused
what has almost amounted to panic
in the money market.
That no other cause is responsible
is proved by general commercial con-
ditions Copper has been at record
prices for weeks: crops products have
brought good figures; the iron and
steel markets have been overloaded
with orders; manufacturers of all
sorts of merchandise have difficulty
in meeting demands; the railroads are
blocked with freight due to regular
commercial business. The whole bus
mess fabric of the country has never
been in better condition.
But the railroads have been raising
wages on a tremendous scale. Every
big system in the country has increas-
ed its operating expenses by millions,
principally in increased labor cost.
They find money for improvements
scarce and dear, and rather than con-
front a heavy loss of revenue due to
legislation, and an increase in cost for
labor at the same time. they have be-
gun eurtailing the outlay they meant
to make on additional trackage. equip
ment and other Improvements. The
cancellation of a few big orders of this
kind has been responsible for the sud
den check to business expansion which
had gone for the past few years on
an increasing scale. Whether this re-
cession is TO be permanent or only a
temporary liquidation, which will be
followed by an Improvement in condi-
lions. Will largely depend upon the re-
lations of the government and the big
financial interests of the country.
-
A review of the furry in Wall street
Thursday, which came so near being
of panic dimensions, shows that 1t was
due almost altogether to the blind
fright of men who had been stampeded
by apprehension of the unknown guam
tity represented in the presidents at
titu1e toward the railroads. After
Mr.. Morgan's brief visit to Washing
ton, the report gained circulation in
New York that Mr.. Morgan himself
had not been treasured by President
Roosevelt's talk with him, and that
the bankers message to his associates
had much to do with the precipitate
However that may be, the fall in
stocks developed reassuring phase be-
cause the call for additional margins
and securities was met promptly and
readily by the heaviest traders and the
blacklist day in Wall street since the
Northern Pacific corner passed through
without a single failure. To the finan-
cial world this showing of strength
was worth a good deal and established
basis of confidence which reacted
most favorably in yesterdays market.
Another feature of note was the read
market as buying factor. The Eng
fish and continental investors are slow
TO buy unless they are assured of an
investment value as well as a specula-
tive hope of profit. They evidently be-
lieve yesterdays figures reached the
investment point. and have confidence
i'm the sOlidity of the railroads and in
dustrial issues of worth. Chicago, too,
was undisturbed by Thursdays alarms;
on the contrary the Chicago bankers,
who are in close touch with conditions
in the west, said that the Wall street
epidemic of alarm was local and
sporadic, and did not affect their mar
ket or conditions throughout the west
at all.
While the losses are heavy and not
likely to be recovered at once, the
shakeup may have a healthy effect on
speculation and induce a caution that
had been woefully lacking. For months
the students of the situation have
pointed to the low bank reserves and
continued demands for large amounts
OF money on short term notes as dam
ger signals In spite of these warnings
the speculative public has gone ahead
as if there was no limit to the prices
of securities or money with which to
speculate In them. By this time the
weaker holdings have been shaken cut,
the losses absorbed in margins and an
element of stability injected into the
market. The recovery from now or
may, and probably will be slow, but
the danger of crash has passed with
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