The morning journal-courier. (New Haven, Conn.) 1907-1913, 1908-04-27
FINANCIAL REVIEW
Growing Confidence in Securi-
ties Reflected in the
Markets.
P. R. R. ISSUE ENCOURAGING
Striking Analogies Drawn With Rail
road Bond Issues of Spring
OF 1897.

Speculative sentiment as reflected In
the security market last week, took
heart decidedly and stocks and bonds
were absorbed with growing confidence
ana Increasing volume. The dominant
factor In causing the improvement was
the betterment of the investment stu
alton and the incident most relied on to
point this improvement was the sue
cess Of the Pennsylvania bond issue. It
Is many years since a single financial
tranaqction has been invested with SO
much significance as this Pennsylva-
MIA operation Analocies are drawn
With the s5O,OOO,OOO Lake Shore and the
Sleo,000,000 New York Central bond is
sues IN the spring Of 1897, which mark
ed in decisive way the re-establish-
ment OF credit and the start of that
growth Of prosperity In the country,
which ran ultimately to unprecedented
heights. The comparison offers some
striking contrasts. The Vanderbilt is
sues were 100 year 10 per cent gen
era refunding mortgages and the par
value realized for them was heralded
as marking a new era IN American
railroad finance. The event proved
that this new basis Of Interest return
on capital was not to be permanent
and was due, In large part, to the pro-
longed prostration which had preceded
1t, coupled with distrust and timidity
of capital which had prompted its
boarding and a commission TO a point
of extreme redundancy. The terms Of
the present Pennsylvania bond issue
Indicate no such unwiedy plethora Of
Idle capital. the forty year four per
cent. bonds being sold TO subscribers
at 96, from which must be deducted the
unknown bankers compensation to ar
rive at the yield to the issuing com
pany. The Pennsylvania bond sale,
however has had the effect of Great
lnig confidence that the revival of cred
1t of the railroads has set in and It
foreshadows tie arrest of the Industrial
and commercial contraction.
Collateral influences expected to flow
from this chief development of the
week played a large part in the stock
market Improvement. The participa-
by the great banking houses of y. NJ.
Rotchschild & Sons. and Barring Broth
ers Co., limited of London. has slim
nlated expectation Of widening inter-
est on the part of the foreign investors
IN the new issues of American securi-
ties, which are known to be imminent
as conditions may become propitfous.
1TTfnn hna ~.
fected, for its plans for a coming bond
Issue have hean announced already and
Its banking connections are with Kuhn.
Loeb & Co, through which the foreign
participation In the Pennsvlva MIA
loan was enlisted The heavy subscrip-
tions for the new issue demonstrate the
strength of the banking position In
New York and the betterment in the
Investment position. Hope was stimu.
lated that industry would be revived
with the supply of resources to the
railroads To resume the work of con.
struction, Improvement and extension
caused by the financial crash last wear
The effect on the security market
while marked. has been sober and re.
strained and without symptoms Of
speculative excitement. The new
financing. while rejecting marked i'm.
provement in conditions over those Of
the recent past, docs not indicate the
full restoration of normal conditions
either in credit or capital supply. The
Immediate conditions in industry and
commerce, also, are not of cheering ef
feet.