The Washington herald., 1907-03-04

the stock began 10 advance, and the bulk
Of the profit from the rise. which repre-
scented the just rewards Of the patience
OF these stockholders through long
course of years. was gained by q few in
siders. TO whom alone the secrets Of the
company were committed.
Eject on Public sentiment.
The important matter to be settled is
what will be the broad and permanent
effect of such disclosures upon public
sentiment in our own country and abroad.
1t must obviously be, for the time being
at any rate, to discourage investments in
our railway stocks and TO give great. If
not decisive. impetus 10 the enactment
by Congress of laws restricting the cap
italization of railways engaged in inter
state commerce, and perhaps, interfering
with the management Of these railroads
in many other ways.
Apart from the Hartman investigation
there were only two subjects last week
concerning which comment was exercised
in the financial districts. One Of these was
the near prospect for the passage of the
AIdrich currency bill. which would. il was
hoped, result in a great change for the
better in the general financial situation.
There is no doubt that the bill viii make
such a change possible if the Secretary OF
the Treasury chooses &. use the powers
committed to him under il. But whether
or not the Secretary viii choose to do so
seems to be a pretty open question I'm
der existing arrangements the present
Secretary of the Treasury has, OF course,
gone great way in this direction.
Would Do Away with Subtreasuries.
The law as it stands does not allow re-
ceipts from customs 20 be deposited in
the banks. but does allow receipts from
internal revenue taxation to be deposited
there. BY segregating receipts from in
ternaI revenues previously gathered into
the Treasury so that these can be rede-
posted in the banks when occasion re-
Quires. and by drawing checks for current
government use upon the money Ia the
Treasury received from customs dues
alone, the money belonging TO the govern
ment has been kept in pretty active cir
culation.
Ii now Mr.. CorteIyoU proposes to put
the customs money directly IN the banks.
as well as the receipts from internal rev
enue. the cash reserves of the banks Will,
Of course, be increased, but this will u-
volve practical doing away with the
present subtreasury system and whether
Mr.. Cortelyou will take such a radical
step remains an open question. II may
be. therefore. that expectations Of direct
and Immediate help To the money market
from the AIdrich bin will be disappointed.
In the second place. more of serious talk
than there has been hitherto was undoUbt-
eddy heard during the week from railway
managers regarding the decrease Of rail-
way net earnings, present and prospec-
tive, owing to the high cost of labor and
materials and the general enlargement OF
railway operating expenses. For the first
month in a long time railway net earn
ings during January showed as q whole,
a net decrease. The feeling unquestiOn-
ably is among our railroad managers at
the moment that there is no prospect Of
an Increase of net earnings along their
lines until they can either reduce 0perat-
ing expenses or increase their freight
charges, and added 10 all these other
drawbacks is the force of 2-cent passt1-
ger fare bills and other hostile legislation
to which prominence is daily given in the
newspapers.