Evening star. [volume] (Washington, D.C.) 1854-1972, 1909-09-19
SELLING INTEREST ON
Market Piungers Continue to
Distribute Stocks.
u. P. IN OLD TRADE TRICK
Speculation Over Future Profits OF
United States Steel.
AFRICAN IN THE WOODP1LE
Bookkeeping Keeps Public From
Getting Wise to the Amount
Of Business.
U. P. IN OLD TRADE TRICK
AFRICAN IN THE WOODP1LE


Of Business.
Special Dispatch to The Star.
NEW YORK. September 1S.-H looks
as though the big market plungers might
have a chance to complete the distrlou-
ton of their colossal speculative lines,
process which was interrupted by the
death of Mr.. Hartman. The market
advanced almost without a fractional
reaction for the several days Immediately
following Mr.. Harrimans demise. and
there seems to be a widening out OF
general interest 1t will be very hard
for the public t. break away from the
Hartman stocks. which have long been
popular favorites, and it may be that
interest in them will continue indefinite
ly. The uncertainty which must attach
to the future of the Hartman properties
for a good while to come will keep alive
a selling interest among holders and
spectators, as well as a desire on the
part of important banking elements
identified with the Hartman fortunes
to see the. leading issues go into the
strong boxes of permanent investors.
Rumor and gossip is keenly alive to
what is going on in Union Pacific, South
ern Pacific and allied properties. The
action of the boards of directors In these
vacancies by the election of pronounced
Hartman men and in naming for chair
man of the executive committee Robert
s. Lovett has set at rest temporarily
only talk of an opposition party taking
charge Of the great railroads built up
out or morphining his policies as they
may see At. The very prompt measures
adopted by Kuhn, Loeb & Co. and the
National City Bank in the securing of
proxies for the stockholders meeting to
be held next month foreshadows a con-
tinuance of the old regime for at least
another year. What will happen after
| that Is theme which engages the at
tention of Wall street, and upon which
is predicated much speculation in the
market.
For the time being, gossips are making
much more than the subject is worth
Of reports that Mr.. Morgan and his
friends will go into control. What seems
to give greatest concern at the moment
is that about the segregation plan for
the placing of the Observation-Disclosures
dollar Union Pacific treasury assets into
the hands of a holding company for the
benefit Of stockholders in general. There
Is very good reason to believe that the
plan will be carried out along the lines
| fixed by Mr.. Hartman and his counsel
ors. 1t was a plan which had occupied
much of their time for a year or more.
and was we'll matured. It is believed
to be an advanced and completed work
of art. Avoiding the mistakes Of the
earlier and cruder Northern Pacific Sc
curities Company, and complying with
the new laws passed by Congress and
state legislatures.
Old Borrowing Trick.
The trick of borrowing stock for use
at annual elections is old as the stock
Iavr hon but 10 ~,
employed in such a wholesale way as by
Kuhn, Loeb & Co. in the case Of Union
Pacific The books closed on Monday
last for Union Pacifcs annual election
on October II. and late on that day 1t was
stated on good authority that the house
mentioned had borrowed 100000 shares
for election purposes. The announcement
was coupled with the knocking, remark
that when the stock was returned to its
owners there would be more natural
market for Union Pacific. The intima-
ton conveyed in the statement and COM
ment was that an artificial scarcity of
that particular stock had been created
and the market given misleading ap-
pearance Of being enormously oversold.
A paragraph Is doing duty to the effect
that insiders expect the United States
Steel Corporation to do business of
thereon a net profit of more than $780,
100000. The net profit clause may be
all right but not the 81 100000, 600 fea
ture. And in that discrepancy is found
warrant for renewal of honest criticism
of a bookkeeping practice of the big cor
poration-one inconsistent with profess
sions of ideal frankness In dealing with
the public. The Steel Corporation Is held
ethics. The inquiry therefore naturally
arises why 1t should persist in embodying
in its official reports statements of gross
earnings very much larger than the facts
warrant. The report of gross earnings
for 1907. for instance. represented them
to be s759,OOO.OOO. on which there was
earned approximately $165. 100000. Now
the truth Is that the $165 100000 profit
was earned on an aggregate business OF
343O. OOO, 900 to 100000. 900.
Experts agree that iron and steel prod
ucts are marketed by the mills on aver
age normal price of about $40 per ton.
(The distributing price in 1908 and first
six months of 1909 was considerably I'M
$4,000 tons Of finished product in 1907.
The production for 1910 cannot well ex
coed 100000 tons. Multiply that by $40
per ton and we have $56O.OJ0.0OO: allow
s45 and the total Is $6S0o0O.OOO. Between
the larger amount and the advertisedH,-
600. 100000 there is big gap. 1t looks
better" however, to make $2OO.OOO,OO0
year on 81 OOO.OOO,O0O business than on a
business Of $56O.OOO.OOO to $e3o.0Oo00.e-
that is. better for popuAstic contempla-
ton. 1t looks better to appear to be
earning 20 per cent on a protected indus
try than actually earning 40 to 45 per
cent.
The bookkeeping African in the United
States Steel Corporation woodpile is the
practice it has of letting its subsidiary
companies sell raw material and partly
finished products to other subsidiary COM
panies, each such move appearing an an
independent transaction and permitting
of a duplication of amounts and swell
ing of the aggregate 1t In no manner
affects net results, but gives the public
a wrong impression of the volume OF bust
ness done.
Pig Iron Breaks Records.
Pig iron production is breaking all rec
ords. 1t is running 1900 tons per week
higher than the previous highest. o2o,OOo
tons per week. and at the rate of 2SOoO.-
coo tons a year. Estimates Of lake ton
mage Of iron ore for the season have been
gradually raised from 35.OOo.OOO to 45OO0.-
GOO TONS The best year heretofore was
~ 100000 TONS The iron ore fleet will be
through it's work by November 3, in time
to take on wheat, corn and oats for win
ter storage to the limit Of capacity. This
elevator feature adds materially to the
revenues of the ore feet
One of the Wall street news agencies