Evening star. [volume] (Washington, D.C.) 1854-1972, 1908-11-01
Financial News Letter
BY w. G. NICHOLAS.

NEW YORK October S1.-The stock
market awaits the verdict of the ballot
box next Tuesday. There is less impa-
thence over the election than might be
expected. A spirit of confidence in the
election of Mr. Taft has pervaded and
filled the situation for weeks. This sense
of certainty has grown stronger with the
approach of the balloting, and while there
has been a disposition to mark time the
average of prices has steadily climbed
The general advance has not been tumui-
tuous during the last week or two, but
the undertone has been almost unbroken-
ly strong. There have been occasional
reactions, but for the most part they
were mere incidents of stock market
routine. and possessed no important sig
nificance. The lengthening of the betting
odds in sporting circles reflected the feel
ing of Wall street. For once the stock
market led the gambling men in its fore
cast of the election results
Wall street gambled on the general
proposition that the country would be
against a political change of control,
whereas the gambling men waited for
specific and detailed information from the
several headquarters. This information
was not supplied for the simple and all
sufficient reason that the men in charge
had no facts of value to impart.
1t is more than an open secret that both
parties are shockingly deficient in the
kind of information which old-time cam
palgners are accustomed to gathering in
and having on tap before the election.
There has been no close organization on
either side, and even the best informed
among the insiders at the several head
quarters confess with varying degrees of
shamefacednesS that they lack data upon
which to form accurate judgment of
what the voters intend to do. There has
been throughout the entire campaign an
unusually large percentage of voters who
are non-committal and of whose inten-
lions the campaigners were unable to
obtain line. About the best they could
hand out to their close friends was that
they didn't know On this point the
wise ones were substantially unanimous.
They didn't know and they couldn't find
out. With them it was quite as much
| guesswork as with the rank and file of
outsiders.
1t remained for the high-browed think
ers who do not pretend to know much
| about the mechanism of politics to size
up the general broad political situation
| at least to their own satisfaction. The
| results may show that they We're entire
ly wrong in their conclusions, but the
course of the stock market shows that
| their fortunes on the accuracy of their
| forecasts. They did not await informa-
| ton from headquarters like the small-fry
gamblers, who hang around awaiting tips
as to who is going to be elected, why and
by what majoritieS. incidentally also
| practically the entire business world
| seems to have concided with and in
dorsed the Judgment of the men of large
| affairs. Again these rank outsiders with
| their speculative foreknowledge of what
| IG Cyni ha
is only of the stock market and the gen.
eral business end of the proposition that
4 this letter is dealing. The writer long
ago withdrew from the field of prophecy.
| The best he can do is to chronicle the
| varying phases of a continually shifting
Wall street prospect. The historian as a
| rule, outlasts the prophet, and in stand
ing averages higher
The quarterly report of the United
States Steel Corporation was the impor-
tant piece of real news of the week. 1t
| was better than the street had been led
to expect. The biggest forecasts of earn
ings did not exceed s25.OOO,OOO net, where
as the totals were given out above s27.-
100000. 1t is almost needless to say that
| the management made the very best
/ showing it was possible for close cheese
pairing of expenses in every direction
| would allow. this fortified and supple
| mented by clever work in the bookkeep-
| ing department. Fortunately the big
! steel trust has an enormous surplus and
| reserve. and is not under the necessity
of appropriating regular or continuously
| large sums to the various accounts, such
l as extraordinary disbursements deprecia-
ton. etc. Ample latitude is given for
! needful manipulation of accounts without
anybody being injured thereby and with
out any wrong being done to either the
public or stockholders. The system of
| bookkeeping in force in the offices of
| the United States Steel Corporation is
strictly down to date and provides for
| almost every emergency and exigency
which is likely to arise in busness-or pol
| tiles.
Up to within a few days before the
| meeting of last Tuesday the controlling
element in the board of directors was for
| the declaration of a dividend on common
| stock at the rate of 3 per cent an in
crease of l per cent. Then there arose
opposition to this move on the part of
Standard Oil representatives on the board
| 1t was urged that such a move would be
| msconstrued and would do more harm
than good-that it would be inexpedient
for many reasons. and that it would be
the course of wisdom to defer the act of
dividend raising until after the election
Mr.. Perkins and his associates who were
for raising the dividend rate had no
stomach for a fight over the proposition
and yielded the point. The situation was
we'll understood on the stock exchange
and the market price hardly budged. The
change in the advertised program created
not the slightest excitement
The insiders are the greatest bulls on
steel stocks. They tell their friends that
common will go to par in the next eight
cen months. They claim that within that
period the plants at Gary and Duluth will
be under full Roadway with an increased
capacity of 100000 tons a year, which
will raise the total production of the
great combine to about 1900, 900 tons a
year. The reports of the corporate for
last year showed a net profit of about
Ii the same rate holds good on IL, OO0 900
tons output it requires only the stub of
pencil to figure out net earnings of
S22o,OOOOOo two years hence. The par
tlsans of the steel trust say it will make
very little difference if the tariff is re-
duced or not. so long as reasonable pro-
lection is accorded the iron and steel in
dustry They say that the strength Of
the corporation is in its trade position
and its superb organization They can
undersell the world by reason of the fact
of the low cost of raw materials It's
ownership of vast iron. ore and coal de-
posts and of transportation facilities re-
duces the net cost of pigiron to the
steel corporation to lower prices than are
possible with any competitors with the
possible exception of some OF the indie
pendents in the vicinity of Birmingham
Ala.
Wall street is hardening itself against
the threatened invasion of muck-rakers