Evening star. [volume] (Washington, D.C.) 1854-1972, 1911-10-15
BEARS TURN BULLS.
Leastwise, Their Talk Has
Taken on a BulIish Tone.
PUBLIC JEERS At PANIC
Refuses Longer to Take Seriously
Wall Street Scares.
IN SEARCH OF BARGAINS
Corporations Are Adding Many New
Names to Their Lists of
Stockholders.
PUBLIC JEERS AT PANIC
IN SEARCH OF BARGAINS
By W. G. Nicholas.
Of The Star.

| ny w. u. NICHOLAS.
Special Correspondence Of The Star
NEW YORK. October II, 1911.
The stock market, although in a state O.
dizziness, is interesting. There are TIVE
very wide-awake parties In the field, ani
everybody is waiting anxiously the devel
opment of decided tendency one way OIL
the other. The big reaction which nine
people out of ten expected would occur
| after the 6-1O-point rally engineered by tn,
| Morgan party has not materialized dowr
to date On the contrary. conditions seen
| to have changed. Great f1nanciers and
| captains Of industry who were intensely
bearish up to two weeks ago are teluns
| their friends that things are looking diff.
| ferent to them and that It is no time tc
| sell stocks.
| Cynical operators do not accept the
changed expressions at par. They have
a suspicion that the takers are not alto
gether sincere and that they are merely
| "stalling," in order to appear to be Civ
ing moral and market support to the
| great leader who stepped In and stopped
generalization two weeks ago or there
| abouts. 1t Is not charged that they are
actually selling the market short or that
they have resumed liquidation. but rather
| that they have taken q position on the
fence and become for the moment qui-
escent.
Price changes have not been important
this week. The standard issues have
more than held their own, however, and
seem to have good stiff backbone. This
applies not only to the rails, but to the
industrials as we'll The scare about
have passed away. If there are to be
cuts in the rate of distribution of earn
ings the majority Of stockholders and the
public appear to be reconciled to 1t. The
idea has ceased to be g. bogy 1t no
longer takes the form of unmitigated
calamity for a railroad or Industrial cor
poration to limit dividends to earnings
The country has passed through many
depressions, and is not unacquainted with
hard times. After ALL the price decline
of 1910 points might be and is generally
accepted as having fairly well discounted
any dividend reductions that may take
place. Not that prices may not go lower
should business continue to contract
through the winter months, but the panic
seems to be out of the situation, for the
time being at least
Come Back to Earth.
Representatives Of big business who
were disturbed in their minds over the
awful things that were to happen should
the administration persist In forcing the
trusts to readjust themselves to conform
to the Sherman law have gotten their
feet down to earth again. They do not
go about wild-eyed and with hair stand
ing on end, moaning over the ruin that
would soon overwhelm the country They
find that the public outside Of Wall street
refuses to be stampeded. They have had
| 1t driven into them that the population
or the country at large regards their
antics with unholy glee. and that 1t takes
the unfriendly attitude of wishing the
administration good luck in its efforts
to compel privileged special interests to
obey the law like common people.
One development which confirms the
theory that the public looks on the stock
market break OF July. August and Sep
TENDER from an entirely different angle
than the professional SPECTATORS and
banking interests Is the fact that there
has been a big increase in the number of
shareholders in q majority Of going cor
pOrations. Lehigh Valley. for instance,
now has 400 more shareholders than it
had at the beginning Of July. There has
also been notable increase in the num-
Der Of shareholders in Pennsylvania.
Union Pacific Baltimore and Ohio, New
York Central, st. Paul, the Hill issues
and many other companies-in fact. prac-
tically everything on the list excepting
a few outfits that are more or less dis
credited because of bad management or
i'll fortune. If the public had been badly
scared 1t would not have gone into the
the face Of a semi-demoralized Wall
street.
The truth Is the public has become
/ educated in stock market philosophy:
1t no longer buys on the booms and
gets frightened out on the slumps, as
| in former years. 1t has adopted tho
mercantile plan of doing business-it
buys goods when they are cheap and
| pretty nearly being the ideal way OF
working the stock market. 1t is the
advice which the market tipsters have
been handing out for two generations
that the way to make money is to
buy at the bottom and sell at the top
| That looks very easy, but traders who
have been long In the game say they
make money because they are willing
| to let the other fellow have the last
few points OF any great market move
enough to let their desire to take the
last fraction get away with their
| good Judgment. This seems to be the
essence Of speculative. wisdom. The
lesson and paid a high price for its
experience, but 1t has at length be-
come wise-wiser than Wall street. 1t
beat Wall street in the panic Of 1907.
and it has been beating Wall street
into other things. 1t played with 01in-
ing stocks for good while. but is
also getting cold feet on that interest
ing line Of adventure, and drawing out.
Public in His Confidence.
The report Of President Vail, Of tho
Western Union Telegraph Company was
almost sensational in the candor with
which he takes the stockholders and pub
lie into his full confidence and tells them
exactly the condition Of that great public
utilities company. He does not hesitate
| to admit that the property is in rotten
shape and that the stockholders need
| not look for any. Increase in dividends
| for a long time to come. He says that
| a large part of the earnings will have to
go back in the plant for several years
before it can be placed on a sound basis
Not that there is any danger Of q re-
duction In dividends below the current
high per cent rate, as earnings amply
justify distribution to that extent. but
he finds there is urgent need Of increas-
| ing the reserves and adding to expendi-
lures for betterment One of the impor-
tant reforms Mr.. Vail has inaugurated
since he took the management was to
increase the pay roll $2.3OO.O0O. He pro-
poses in the near future to give form
to a pension system and to introduce hui
name and modern methods into opera
ton. First and last. Western Union en-
ploys hundreds and thousands of peo-
ple men. women and boys. It has been
l'tightwad' for twenty years or more and
| is entering upon a new life. Western
Union earned about 5000. 600 more gross
THAN during the fiscal year preceding. but
not quite so much net by reason of the
fact that it put back into the property
every dollar that could be spared.
| The decline In prices of steel products
I IT, t.