The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1909-10-03
STOCK MARKET IS
IN FREAK STAGE
Bull Tip on Any Old Thing
Makes Good
STEEL EARNINGS ARE HIGH
Next Year $2oo,ooo,ooo Earnings Are
Promised for Steel Corporation
Which Is Entering Upon
Great Prosperity.
STEEL EARNINGS ARE HIGH
BY w. G. NICHOLAS.

BY W. y. NlCFfOLAS.
New York, October Especial -The
bull market certainly reached the freak
stage. 1t arrived at the point where ev-
cry tip to buy any old thing makes good.
One of the most conspicuous operators in
the market confessed day or two ago
to friend that he was rapidly being
| driven to frenzy by the flood Of advice
pouring in upon him from every quarter
to buy. buy, buy.
IF bought everything that was tipped
on to me-" he exclaimed, "the Bank NJ
England wouldn't have money enough m
pay the commissions. Everybody seems
to have gone crazy. The worst of II f.
everybody who knows me seems to think
| must have gone crazy, too"
That about expresses the situation. Not
that the general level of prices might not
De Justified, but it can be said with all
truthfuiness that in large measure ex.
lstlng quotations represent the full fr,i.
tion OF hopes and expectations upon which
the Dull campaign was carried on The
market anticipated the prosperity which
mas come upon us in the tremendous
advance which has taken place. In other
words, the lofty range of prices now es-
tablished has unquestionablv discounted
IN great measure most of the good
thlngs that have occurred and that are
Immediately ahead of us.
1t is also true that many of the more
important interests which have been ac-
tive in the bull campaign and which have
profited hugely thereby have realized up-
on their speculative lines within the last
month or six weeks. Some of them have
propaply gone back into the market again,
but the bulk of the buying now being wit
messed is by the outside public. 1t is the
pubic that is carrying the bulk Of the
noatlng supply Upon that point there
Is SUBSTANTIAL agreement among those
whose observation and Judgment makes
their opinion of real value.
the presence of hundreds of thousands
OF visitors in New York has contributed
largely to the market activity of the ma ST
10 days. Among the strangers within tha
gates of New York there are doubtless
tens of thousands who took little flyers
In the stock market to pay the expenses
OF the trip. The enthusiasm occasion ed
by this new buying was infectious and
communicated itself to the seasoned ele-
ment of Wall street. 1t gave to the mar
ket an appearance of genuineness which
carried the rank and file of traders Off
their feet for the moment
Steel common has been the leader
| through all this latter day excitement.
| Its right to leadership seems to be gener-
ally accepted There are more stockhold-
! ers In, Steel than In any other corporatie<
and wider public interest in the affairs
| or the company Not even the Hartman
stocks can approach Steel
United States Steel has the further adj
vantage of entering upon a period of tre-
mendous prosperity, the size and extent
OF which is measurable by ordinary rules
of calculation which ANYBODY and everv-
body can understand. The forecast is for
s2oo'Oo00O0 earnings next year on bust
ness of approximately 100000 900 tons. The
total may easily reach 1900 900.
Once before in its history the Steel trust
earned close to- 900 in one quarter
Earnings for the quarter ending with
September will approximate $4,000 00O
Earnings for the last quarter of the wear
should be $45,O0O,OO0 at least. The pre-
vious high record of earnings was made
before the trust owned Tennessee Coal
and lron which has a present capacity
of 100000 tons, and also before Gary
was started
So clearly defined seems to be the fu-
ture of Steel common that not a few of
Iron and Steel specialists are selling their
ting the money into the Junior issues.
This gives to the preferred bonds an ap-
pearance of weakness which is puzzling
to some Of the historians in the street
who are engaged in struggle to show
that common is too high and is being
artifcially doomed
Railroad earnings, gross and common
are about top-notch and proof accunu-
lates that the operation of railroad prop
critics represents higher degree of labor
and administration efficiency than ever
before. This is reflected in the generally
larger increase In the percentage of net
than of gross. 1t is also reflected in the
better and cleaner handling of traffic.
Nowhere else is this situation illustrated
to better advantage than in the Pittsburg
district, which originates more tonnage
than any other point in the United
States. Ordinarily with the tonnage now
handled in that district there would be
a condition Of hopeless car congestion. AS
it is, there is comparatively little clog
ging in the movement of business
The same is true with variations as to
conditions with the great crop-moving sys-
TENS of the west A prominent railroad
traffic manager made the statement to
the writer that two or three years ago at
least 100000 moro cars than are now in
use would be required to handle tonnage
now offering, and taken care of.
With the large business now moved and
the probable substantial increase over
this total during the next Is months
arises the need Of increased equipment
and continual investment for mainten-
ance and improvements on property. This
will call for heavy outlays and for cor
responding enlargement of stock and bond
capitalization.
Happily the railroads are in excellent
shape to bear this increased burden upon
their resources, and there is nothing in
sight upon which to base expectations of
important reactions in the security mar
ket What the really important interests
would like to see would be gradual let
ting down in speculative excitement and
the maintenance Of existing stock quota
lions somewhere about where they are