The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1907-03-09

prices was meant. for there was equally
good buying bid Up, and, therefore, u
would be incorrect to say that the buy
ing now is the best since the stock sold
at 20 or 50.
1t was stated in this column n week
ago that interests which took leading
part in advancing Reading about JOG
points during the years of 1904 ana 1868
were again openly bullish on the stock,
although for year past they had had
nothing 10 do with its movements. since
that time the stock has had an ad-
vance that has been nothing less than
sensational. considering the character OF
the general market, and all sorts of
stories have been invented TO account
for It. but according to the best authori-
ties the only reason for the rise is found
in the fact already stated. that the
anthracite coal trade is In better condition
to-day than at any previous time In the
history of the industry. The causes
leading up to the present unprecedentedly
favorable condition Of the hard coal trade
are that year ago we were passing
through one Of the mildest winters on
record and the demand for coal was
small. while at the same time the COM
panies were making a supreme effort to
prepare themselves for strike that was
expected 10 occur In April. No strike
occurred. there being only suspension
Of operations at the mines for few
days. and through the summer and fall
the stocks. Of coal In the hands OF deal
eTs were larger than ever before at the
same period Of the year, as a cOnse-
quence OF which earnings Of the com
panies were mitch smaller than they
should have been. Now, however, sup
plies Of coal above ground are almost
exhausted and as the sections that found
il difficult To get fuel during the winter
are likely to anticipate next season
wants early, the outlook promises several
months of the most active business the
anthracite coal roads have ever had,
Large interests, acquainted WITH these
facts. have bought Reading stock in an
ticipation Of an increase in the dividend
and. possibly. with view 10 proiiting by
a technical position which promised them
opportunity for a quick profit.
The bears were all ready for any an
nouncement that might be made Of the
action OF the Southern Railway pre-
ferred dividend. Had the directors de-
Cided 20 reduce the rate. the announcement
would have been hailed as the first break
Ia the ranks of the diyidend-payers, and
others would have been picked out as
likely 10 follow. They were fully ready,
in case the regular rates were adhered
20. with an argument 70 fit the case. This
one they were given an opportunity 10
use. and Il proved 20 be that If Southern
Railway preferred, "a per cent stock,
sold at 72iz. it established a basis OF in
.vestment return which other stocks would
in time have to come 20. They probably
recognized that while Southern preferred
was out Of line with others. it was be-
cause il was too low, but their purpose
was not 10 level up, but to level down.
In this they succeeded 50 far that there
was a notable decrease by the time the
market closed IN the number II brokers
who were willing 10 predict a further fall
IN prices Many eTstwhile bears had lit
tie hesitation in expressing the opinion
that at the end Of the day the short side
of the market had become rather dan
geTOus.