New-York tribune., 1909-06-18
FINANCIAL AFFAIRS
STOCK VALUES SLUMP.
Ueak accounts ThrO5cn on the Mar
ket-HOReY Rates Unchanged.

The weak technical position Of the stock mar
ket and the absence Of aggressive support were
responsible for further losses in the greater
number of issues IN yesterdays trading. In the
early afternoon declines ran from TO points
under the best figures Of the morning. the move
roent being helped by the catching Of stop orders
and the Iiquidation of weak speculative accounts.
against which commission house customers either
,yera unable to advance additional margin
else preferred to take loss in the expectation Of
btlving the stock back al lower quotations. Va
rious stories Of the usual type We're put forth as
reasons for the break in the market, but il was
unnecessary 70 look beyond the recent extended
period Of advancing prices and active bull ma
nipulation To find The true inwardness OF the
bear attack upon prices and the indifference Of
the leading Wall Street interests TO the forced
throwing over of stocks for which the bag was
held at lower levels Wall Street was not ma
terially upset over the suggestion Of the Presl-
dent that & tax be imposed on the net earn
ings of corporations. though the theory Of taxa
ton OF this character not indorsed in most
banking circles while the speculative COM
munitv failed TO discover anything, according
10 its views Of a particularly unfavorable char
acter in the report Of the Hughes investigating
committee. except the recommendation Of
minimum margin Of 20 per cent. which. however.
was one Of the best points made by the investi-
gators. 4 20 per cent margin requirement WodId
serve 70 discourage speculation by persons VINO
cannot afford and have moral right 10 engage
in speculative operations. Prices advanced from
TO points from the low levels before the close.
chiefly on covering Of shorts, but in spite of this
movement the final transactions showed great
irreeularity and weakness in spots with the
heaviest net losses in Amalgamated copper
American Smelling, St Paul, Peoples Gas
Union Pacific Wabash preferred and Reading,
the two last named losing ga points each
United States Steel common suffered maxi
mum loss of "a, but was we'll bought on the de-
cline. ending only 5s under Wednesdays closing
Total dealings amounted to more than l2Ooo0o
shares. In the bond department prices also
moved toward q lower level on the same sort
Of liquidation that reported in stocks.
The failure of the Reading directors TO in
crease the dividend the common stock found
material reflection in the price Of the issue yes
terdav selling, however, being confined IL great
part To the professional element No reason
has been advanced for the maintenance OF the
stock per cent basis when earnings JUS
tify d larger payment but as the chief owners
Of the Reading secured their stock at low
figures they apparently are satisfied, for the
present at least, with the return on the invest
r1ent, and willing To encourage the use OF
large surplus earnings upon the physical better
ment of the property, which already is in d high
state of efficiency. the basis of earnings far
this year there IS little doubt that the company
will show "A surplus for the common after
charges preferred dividends, improvements and
sinking iunG require Oh upward Oh ~ p'l
cent which, of course. is extremely encouraging
to the principal interests in the company, though
TO the minority stockholders there doubtless will
occur an idea the Of accumu-
lating surplus if they are not 10 share in it?
The administration OF the Reading has made
noteworthy record for conservatism and sound
Judgment. and i doubtless believes that the
time has not vet arrived when increased divi-
dends are warranted. notwithstanding the large
earnings and the strengthened position of the
COMPANY as consequence of its nalf ownership
of the valua bic Central Railroad of New Jersey,
which is earning about twice the s per cent divi-
dend il pays its stock. The people who
bought Reading common low figures have
excellent investment but at its current quo
tation, which shows return Of about 212 per
cent II does not appeal 10 new investment buy
ers large amount OF the Reading stocks is
held by the Baltimore & Ohio. which secured its
investment a figure that meant a profitable
Yield and the fact that the Baltimore & Ohio is
such a large owner of Reading increases the
actual value Of the Baltimore & Ohio stocks. II
is interesting to note that for the month Of May,
the figures of which received yesterday.
the Baltimore G. Ohio showed increase in
gross earnings Of SS3s572 as compared with the
same time a year ago. and increase in net
of s725,535. making increase in the latter
since July ! of S3,5s4,91l
= slightly easier tone is reported in the mar
sened demand for stock market purposes. while
in the time department conditions In
changed, the chief inquiry being for four and six