Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-06-23

month later. Inc Dull market started In
In July and went on for more than two
years.
Mr. L. w. Serrell, an authority on rail-
road engineering and finance, has written a
short review of THE Railroad Situation in
the United States" in which he summarizes
the situation in this fashion: Ten years
ago many of the railroad companies in this
country were going through reorganization
after failure. At the present time many of
the railroads are going through what might
De called reorganization without failure;
that is, continually issuing new securities
causing mistrust and misunderstanding on
the part of the public. A few years ago
the business of the railroads had grown to
such an extent that 1t seemed impossible to
secure equipment fast enough to handle
the business that was offering, and great
freight congestion ensued. New securities
were issued by the railroads to provide
funds to pay for such equipment Stock
holders. the public and exchange traders
looked upon these securities as having
great speculative value through the posi-
bilities of increased business, and the
stocks with the accompanying rights, usu-
ally rose in value, SO much SO that the ex-
preston, A melon is going to be cut came
generally into use. Today the railroad
companies are continuing to issue new Sc
curties for the purpose of providing not
terminal facilities which have grown mad
equate; but new stock issues, with the &C
companying rights, are not looked upon
with the same favor as formerly. In fact
in almost every case where such new issues
have been brought out the values of the
stocks in question have declined
\
One of the stories that is going around Is
that John D.. Rockefeller, J. Pierpont Nor
gan and Andrew Carnegie are leagued to-
gether in plan to eliminate Mr.. Harri-
man from the situation. The head of the
house of Rockefeller. as every one knows,
doesn't like the way things have been go
ing, and the story is that he wants to make
a scapegoat of Hartman. John d. has
never taken kindly to latter-day methods
of high finance. He never grew enthu-
siastic over the Amalgamated Copper pro-
motion. When II. Fl. Rogers, William
Rockefeller and James Stillman put out the
Amalgamated the Old Ian at IS refused
to be drawn into the venture. He was con-
tent to go ahead making his millions out of
the oil business and putting his surplus
profits into standard railway stocks. 1t Is
said that he never put a dollar into the
original Amalgamated fotation, although it
was common gossip after the big decline
in the stock that carried it below $40 that
the Old Man thought well enough of 1t
then to put $4,G0OOOJ to S5,OOO,OOO into 1t.
He bought the stock ex-promoton enthu-
siasm.
When the youngsters-Rogers, Rockefeller
and Stillman-panned their big Union Pa
cific campaign. with Hartman as their fig
urehead, the Old Man again refused to be
drawn into this colossal speculation. Now
that the Union Pacific campaign that cul-
minated last fall with the spectacular divi-
dend increase, has collapsed, with fright
full aftermath of corporation batting all
the country, the Old Man at % says,
II told you so,'' and tells the youngsters
that they have got to mend their fences.
The insurance scandal was another disas-
trous outcome to the colossal ambitions of
the Standard OIL speculative clique, and
John d. tells them that if they hadn't been
blind to public sentiment the insurance
scandal would never have been exploited.
And then there is L-wson-always Lawson.
The Standard OILY crowd, after having used
the Boston operator in piling up fortunes
IN copper speculation, threw HIM over the
parapet. thinking that he would meet
sudden financial death. But he bounced
back like a rubber ball, and by the clever
est publicity campaign that was ever en-
gineered in this country stirred up so much
trouble at IS Broadway that the Old Man
said some very bitter things in the inner
councils and tried to appease the gods by
opening up his purse for the general good
of humanity. This bitter governmental at
tack on Hartman, with it's coincdent
shock to American credit abroad. is the last
straw. John d. says that Hartman must
be shorn of his power, and the story is that
Mr.. Morgan and Mr.. Carnegie with him.
The April railroad statements present
rather remarkable showing in view of the
fact that railroad men at the beginning of
the year were saying that, with the rapidly
increased cost of operation and the unex-
pected let-up in commercial activity, we
could not reasonably expect a continuance
of Increased earnings. In both January and
February, while there was some increase in
gIos earnings. there was decline in net
earnings as compared with last year. And
in March the net was about a sIand-off.
But now we have the April reports, showing
increases in both gross and net in the
neighborhood of % per cent. Seventy-eish.
roads show that the April gross increased
from SOS, 100000 In 1895 to $134 100000 this
penses was S17,OOO,000. The April net IN
creased, therefore, $50 00O,OOO to $40,0OO,Og.
The coal roads contributed largely to tha
April increase. undoubtedly because of the
length of the winter. Among the increases
in gross for April in the coal roads wer'.:
Reading $l,OO0.000; Jersey Central. $780,
600; Lshigh Valley, $900,0O9: Baltimore md
Ohio, $4,000; Erie, 100000. One reason
for the very favorable April showing, as
compared with the three preceding months,
may be found in the fact that April last
year only showed a Slight increase over
1903, while the three preceding months
showed very heavy increases. The showing
has now been reversed.
70
In the opinion of many of the most Sd
gacious men in Wall street the stock mar
ket around present prices has discounted