The Washington herald., 1910-12-12
Spectators Force Up Prices
for Short Period.
NOW LOOK FOR STABILITY
While Brisk Advance Has Ceased,
the Conditions Are Far from a
Fanic-Larger Interests Do Not
show Any Feeling of Despondency.
Coal Decision Is Pleasing.

StoSk ihalhet uufihS tne IaSI TWO months
recalls the very ancient legend of the
King of France. who. with 9,OoO men,
marched up the hill and then marched
down again. The market rose violently
upon what all conservative critics of the
business and financial situation declared
TO be unsubstantial grounds, at least as
regards the extent 10 which the advance
was carried. Then il fell even more vio-
iently. and at the beginning of last week
was but little higher than II was at the
END or the summer.
1t IS now clear TO everybody-what
close observers had no difficulty in per-
ceiving at any time-that the rise previ-
Gus to the election was the work of
few rich Spectators, without the sup
port of either banking or large financial
interests or of the general public 1t
was easy enough for these men to ad-
vance the market or at least the market
Tor few stocks, by sheer brute force.
but after they had advanced prices they
found that nobody cared to buy at cur
rent quotations. and that every one real
lied the hollowness OF the situation that
had been created. Then the slump oc-
Cured
security Prices Down.
1t is fair TO observe that security
prices have already discounted a good
deal Of poor industrial and commercial
business IN months TO come, and the
possibility that dividends may be reduced
upon certain stocks. To name specific
stocks might be invidious but any per-
son ordinarily familiar with Wall street
affairs will see at a glance in looking
over the list of securities that there are
many whose current quotations very
strongly suggest that a curtailment of
present dividend distributions upon the
stocks concerned might not be accom-
panied by any further fall in market
valuations
And now. looking at the matter broad
~ what Is the general prospect for
business in the year TO come? Let IL be
conceded, for the sake OF argument. that
II is for year of profts which will not
be as large. at least relatively as those
OF the calendar period just ending, and
that the year viii be attended bv a con-
tinuance OF that same readjustment and
settling down that have plainly been go
ing on ali over the business and fnan-
cial world ever since the financial
troubles In 1907. Even So let any sensi-
bic person ask himself the question
whether the prospects are for anything
that can be said TO partake at all of
hard times? Nobody expects that boom
years can be forever enjoyed.
The very idea OF so-ealIed boom years
presupposes that there must be occasions
when business viii travel at a slower
pace and accumulate strength for another
brisk advance. But this does not neces-
sarily entail an era of panic or wide
spread Bankruptcies Among our larger
bankers and business men the feeling is
not al all one OF despOndence. They say
10 man that while business ventures
should perhaps be entered into more mod
erately just now than they were "A year
ago, yet that they should still be entered
into, and that there is nothing in the
situation 10 induce pessinism; and that
this view OF the situation is what Is at
heart entertained by the mass of people
is shown very plainly by the course fol-
lowed in the security market by certain
leading stocks.
Victory for Railroads.
The one important development last
week was, OF course. the decision of the
United States Circuit Court in Philadel-
phia in the Temple Iron case. which was
in al essential regards a sweeping VIC
that, taken in connection with the deci-
sion rendered by the United States Cir
cult Court in the Standard OH case-a
decision whose true character has often
been misunderstood far toward in
dicating the probability that the con-
struetioh placed upon the antitrust law
by the Supreme Court of the United
States in the great cases now awaiting
argument viii not impose material hard
ship upon the business interests OF the
land
In the present case the Federal court
holds that the only improper act on the
part OF the railroads as pertaining TO an
alleged illegal coal combination was the
joint membership of these railroad com
panies in the Temple Iron Company. II
viii occur to every one that such infiu-
ence in the matter of coal prices as might
have been exercised by the Temple Iron
Company can be accomplished by the
different interests concerned in a great
variety of other means.
The government charges against the
coal companies have been substantially
thrown out of court The courts declare
that The so-called 65 per cent contract un-
der which the railroads buy In the mar
ket the product of independent mines
this being the one salient point Of con-
tenuon-is perfectly legal: that the Erie
and Reading companies had a right TO
acquire the New York, Susquehanna and
Western and New Jersey Central rail-
roads, or a controlling interest in these
companies stocks. and that. in general,
the whole method which the railroad com
panies have pursued in conducting the
coal business in recent years, with the
single exception Of the Temple Iron Com
pany. is not open to attack.
Striking Similarity.
In all. there is a striking similarity to
the real gist of the decision in the Stand
ard oil case to which reference has been
made There the government asserted
that the mere fact that the Standard Oil
Company had acquired and enjoyed a
very substantial part of the Interstate
and international commerce in petroleum
and its products was sufficient cause for
the enforced dissolution of the company
under the antitrust law. But the court
held that this was not and could not be
the proper Interpretation of the law,
which was that while unlawful means
TO monopolize and continue an unlawful
monopoly OF interstate and international
commerce were misdemeanors, monop-
olies OF part of interstate and interna-
tional commerce by legitimate competi-
ton, however successful, were not de-
nounced by the law and might not be
forbidden by the courts. A decree or
dering the dissolution of the Standard
oil Company was issued because the
court maintained that a mass OF evidence
showed that the conduct OF the company
as distinguished from inferences drawn
from q possibly illegal structure had
been oppressive in its acts and general
business policy.