New-York tribune., 1909-07-08
FINANCIAL AFFAIRS
SO. PACIFIC ADVANCES.
General Market Firm and Dull
Money Rates Edsy.

Stock market values moved within narrow
limits throughout the day. with final figures at
small gains in the larger number of shares.
Transactions were light in most issues and
q rule were made UP OF the operations Of the
professional element. commission house business
rejecting little interest in speculation on the
part Of the public, while presenting sign OF
aggressive trading by the general Wall Street
community except in the last half hour of bust
ness Rock Island the Hartman shares and
Atchison We're in fair demand American Car
and Foundry was bid up by room traders. Great
Northern ore certificates responded to the deal
ings of a small bull pool in them and Consoli-
dated Gas advanced q drive against the
shorts. Residing and United States Steel com
mon were relatively inactive. while the general
list presented no novel features Southern Pa
cific was helped to a small extent by the report
that q large block Of the company's convertible
bonds had been placed in Paris and would be
listed the French Bourse the rurnor sug-
gesting the natural idea that the bonds are
convertible into stock the listing Of the latter
would automatically follow the listing Of the
mortgage issue The fact that these bonds are 4
per cents and are selling at a premium leaves
room for serious doubt the possibility Of
application being made for their listing at Paris
as such a movement apparently would not be
profitable for the bankers. who have to pay the
heavy listing taxes imposed by the French law
and still offer the bonds at a price that would
appeal 10 investors Southern Pacific stock
gained in strength in the afternoon, and near
the close the entire market gave exhibition
OF activity rising values that wholly alb
sent from the movements earlier in the day,
United States Steel common the InterborOugh-
Metropolitan issues. including the "a per cent
bonds and Chesapeake & Ohio being features.
Encouragin reports from the agricultural section
Of the country and the publication OF figures
showing large gains in iron production served
attract increase in professional buying in
the railroad and steel securities. while the Of
fering of Interborough- Metropolitan bonds by
the leading banking house in the Street had a
favorable effect upon the shares Of the COM
pany. Third Avenue stock sold as low 16I2.
hut closed unchanged from Tuesdays final quo
tation-
The receiver Of the Third Avenue Railroad
estimates that the reorganized company will be-
gin operations with net earnings after payment
Of interest on the prior liens of about s1.500000
year and after deductions for depreciation
100000 will. he believes. remain for the Sc
Curities 10 be reckoned with in the proposed plan
Of rehabilitation The full interest on the s31,-
O45O00 adjustment bonds to be issued would
call for 81 552 0oO which on the basis Of the
ceiver's estimate of net earnings would leave
material deficit ahead of any return on the
stock and the objection Of stockholders 10 pay
ing q s25 assessment on their holdings therefore
appears to be we'll founded. especially as the
receiver is quoted as saying that he may not
think the stock worth a dollar a busheL" Based
on the receivers estimate Of net earnings the
stock is worthless. but il should be borne in
mind that these ngureS are computed on Jle net
earnings of the poorest two quarters Of the
year and do not take into account the improve
rnent in income that may be expected from the
growth Of population along the lines of the COM
paIly 10 say nothing OF the benefit the company
viii derive from the method Of handling
fares which means the saving Of many nickels
that in the past have gone into the pockets of
dishonest employees The assessment, however.
Is excessive and is responsible for liquidation
OF the stock to a considerable amount by dis
cllsted holders It may be recalled that last
fail the marlborough Metropolitan Company
quietly sold its Third Avenue stock at an aver
age price believed to be in the neighborhood Of
40 the operation being conducted at time when
generous tips To buy the security were cirCu-
lated in the Street. In some quarters Of the
financial community il is now believed that the
Intcrborough- Metropolitan has been rebuying
Third Avenue in order TO control the reorgan-
lied property. the idea being plausible. the
difference between the price a which the Inter
borough Metropolitan sold its Third Avenue in
IsoS and he hsure at which il is selling to-d day
would not be far from the S25 assessment de-
Tnanded in the reorganization plan.
The InJeTbo-ougl- Metropolitan under reor-
ganization viii be something different from the
financially desnoled company that went into
receivers hands nearly two years ago. and un-
der its control Third Avenue might become. =
greater property than II run Independently
There is no reason Why ordinary operators
should buy Third Avenue stock with = So as
sessment ahead. but with the assessment r,aid
the stock IseE prove attractive on declines
which doubtless viii De engineered on The s.ecu-
latiVe argument that The company net earnings
for years WiN not warrant dividends on the.
stock II is not unusual for the stock OF a r.
organized property 90 drift back TO a level that
represents the wiping out ef the assessment 50
q q E1lu a. : -