The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1907-01-27

able promptness. Every motive of self
| interest on the part of the railroads and
! the public alike demands that this situa-
ton be relieved, and relieved quickly.
The carriers are ready and willing TO
! do their part to furnish such relief. Gov
! eminent commissions and other public
| bodies have taken the subject up, and we
| are urging drastic measures to force the
i carrying interests to add to their facili-
ties to the extent supposed to be nee
essary. But while on the one hand there
! is a concensus of opinion that the rail
roads must spend enormous further
amounts of new capital, our legislators
and government officials are doing every
thing within their power calculated to
make it difficult to raise the needed
money.
In addition, and by no means least of
all, the cost of labor, of material and
! supplies, and of everything else needed
by the roads in their operation is stead
| lily rising. The congestion of traffic still
further complexities the situation. The
result is that expenses are being so great
ly added to that the augmentation IN
| the expense account far exceeds tho
gains in gross earnings, large though
these continue to be-"
New York Central Goes Slow.
The unofficial announcement by the
! New York Central that 1t will make
haste slowly In spending money from now
| on is a significant sign of the times. The
Central has been spending money lavish
| ly for several years, not nearly as Law
| ishly as the Pennsylvania, of course, and
| the property is in the best condition in
Its history. The great work of electrify
ing the New York terminal will, of
| course, go on to it's completion. But while
money labor and materials remain at the
present high level, the Central is not
| going to plan any more extensive extra
| ordinary expenditures. The power that
lies in the hands of the railroads to
check the speed of the wheels of pros
perity is enormous. We hadfa striking
| illustration of this three years ago when
all the leading roads of the country tao
lilly agreed to scale down their orders for
| rails, locomotives, cars etc. The railways
of the country buy nearly so per cent of
the product of the steel plants. The in
slant there is any concerted action on the
part of the railroads to cut down orders
for the products of the steel plants the
steel industry is metamorphosed from
| prince to pauper. This was what hap
pened in 10000. The purchases of rails
alone now foot up to $100,000,000 a year. IL
| the dominant interests in the leading
roads of the country decide that it is a
mistake to make further big expenditures
with money, labor and materials at these
high prices the present boom can be very
quickly checked.
1t is a good deal easier these days to
regulate the safety valve of prosperity
than 1t was a few years ago. A very
large share of the material activities of
the country-in transportation, manufac-
turing and mining-is dominated by a
small group of capitalists who work more
or less in harmony. These masters of
commerce in 1904 agreed that the country
was going to swing into another period
of great prosperity, and laid their plans
accordingly. When these same men shall
decide that we have reached the zenith
of the boom. and that the time has come
to prepare for less prosperous times, they
will again act in harmony. We have very
recently seen the concerted action of
these leaders in raising wages. The
wages of many hundreds of thousands of
workers were raised in the course of a
few weeks. The men In this country can,
in the course of an hours conference, af-
feet change in the years output of the
steel industry of s100000,000
Bond houses and other concerns and in
dividuals who went rashly into the I'M
derwriting schemes and syndicates during
the last year are having hard shedding.
Undertakings which do not show loss
are the exception. In many cases the
losses run into big figures. The difficult
ties under which the underwriting frater-
nifty and some of the bond houses are
laboring constitute one of the underlying
causes OF weakness in the stock market.
Many of the pools and syndicates have
dissolved and turned back upon subscrib-
ers their allotments. deeming it the part
of wisdom TO scatter the burden as much
as possible. The consequence has been
very heavy offerings of undigested Sc
curities upon a declining market. The
mails are burdened these days with cir
culars and confidential advices from bond
houses urging goods upon the attention
of the investors Bargain hunters are ad-
vised that now is the accepted time to
jump in and get goods cheap. Strange to
say. the bargain hunters are reluctant
to follow this unsefsh counsel and hold
aloof seeming still lower prices and
| better bargains.
Only a few months ago a number of
newer bond houses took advantage OF
every opportunity to outbid the older con-
Germs for new issues. and to organize syn
dicates for underwriting at terms whlc4,
the veterans in the field could not meet
The new houses had the market all to
themselves, and We're making great head
way in a business way. They commanded
large space under the headlines in news
papers and were widely advertised as be-
ing coming new powers in the world OF
finance Now they are in trouble and
struggling to keep on their feet until they