Los Angeles herald., 1910-06-04
STOCKS BREAK As
IN DAYS OF PANIC
Wall Street Receivers Following
Optimism Attending R. R.
Rate Situation
AWAITS TAFT'S STATEMENT
Trunk Line Chief DaSheS Cold
Water on Hopes with
Gloomy PropheSies
AWAITS TAFT'S STATEMENT
TAssociatad Press1

NEW YORK, June 3.-Prices of
stocks broke again today with vio-
lence almost unexampled outside of
times of absolute panic. This was after
a show of resistance to the forces OF
depression during the early hours, when
the heaviest selling that appeared
seemed to be easily absorbed and
prices rebounded repeatedly from the
declines.
The action of the market at the
time gave rise to an impression that
the worst of the shock had been alb
sorbed and that conditions were ripe
for a rise. Uncovered shorts were
made nervous by this action of the
market and helped on the tendency
by their buying to cover.
The kind of explanations offered for
the recovery showed plainly how at
tention remained centered on the DOM
inant topic Of the governments policy
toward increase in freight rates. There
was circulated an expression of conf
dence from an anonymous legal au-
thority that the injunction against the
Western Trunk Line advances would
be promptly dissolved. Another rumor
was that President Taft contemplated
a statement in one of his western
speeches calculated to allay appre-
hension. A.
RAILROAD OFFICIALS GLOOMY
on the other hand, there wPs no lack
of gloomy expressions by railroad ofti-
cials of the consequences they saw
threatening because of the suspension
of the advance in rates. President
Brown of the New York Central was
quoted as saying: THE credit of rail-
roads has been almost totally de-
stroyed by this (the rate in1unction),
and it will be almost impossible for
any road to secure a loan here or
abroad, in my opinion"
President Brown was quoted further
as saying that 100000 of New York
Central bonds had been sold in France
at SSls cents on the dollar.
Almost at the same time President
Browns colleague, Albert H. Harris,
general counsel of the New York Cen
tral. was quoted on his fresh arrival
home from France as expressing great
satisfaction with the success of the
sale of S1O,O0O,0 900 Cleveland, Cincinnati,
Chicago & St Louis bonds, which are
to be issued to the French people at
a discount of per cent, or price of 81.
SO far as could be learned. the two
references were to the same transac-
ton and the discrepancy in the two
views went unexplained.
BREAKS PRICES
The use made of the Brown interview
was very effective in precipitating
liquidation and in breaking prices to
the lowest level of the year There
sprang up n series of rumors dealing
with the probable further steps to be
taken by the government in the prose-
cution of the railroads having to do
with the alleged intention to break up
the various traffic associations, to en-
Join other proposed rate increases and
to proceed for contempt against such
railroads as were enjoined under old
lawsuits against the Transmlssoun
Freight association.
Use was made also of the fragment
ary extracts from President Tatts
speech at Ada, O.. especially the pas
sage, at is reasonable to suppose that
at some time within the next decade
there will be some reaction or some
financial stringency, or perhaps
financial panic"
Also the passage, "I think the issue
of most Importance will be the question
of the preservation of private property
or it's destruction. and the substitution
of a certain kind of cooperative joint
enjoyment Of everything, which Is the
ideal of Socialism"
READ BETWEEN LINES
These words of the chief executive
were reported on the news tickers al
most without context, and in sensa-
tional suggestiveness of extra spacing
between the lines.
The mood of the speculation be-
came fairly hysterical at times, and
last prices were not far from the low
est. Union Pacific was down. 81 on
the day, and Reading, New York Cen
trail, the other Pacifics, United States
steel, Amalgamated Copper and the
railroad equipment stocks in the
neighborhood of four points
Bonds were easy. Total sales, par
value, $2637, 900.
United States bonds we're unchanged
on call