Bismarck daily tribune. [volume] (Bismarck, Dakota [N.D.]) 1881-1916, 1911-05-15

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couraging enthusiasm, energy and pro
gress. And this new wealth consti
tutes the fountain head of a natural
cycle of development shat applies te
all branches of finance, trade and in
dustry. Depression under such cir
cumstances is largely matter of tenn
porary sentiment. In dull times PEG
pie are not inclined to in any way
risk thei: principal, which is thei'
share of the capital that is so neces
sary for the normal Developments oi
our great country. But as soon as
business and industry beg,n to expand
confidence quickly follows in the wake
and it does not take long f.: the saw
irgs of the people to seek employment
in the security markets, an thus pro
vide the capital which our railroads
need for their proper upl:ecp, i'm
provements and extensions. The rail
roads in their turn are BY far the
largest customers Of the iron ard steel
industry. When the industry in S.
uuence becomes active and profitable
the natural order of events IS for these
favorable developments to spread auto
matically to all the other branches OF
the industrial and financial family.
The financial upheayal OF 1907 started
more especially as the result OF the
inability Of the railroads to obtain
the necessary new capital to finance
the gigantic improvements that under
the stimulus of the unprecedented per-
iod of industrial and mercantile activi.
ty was then in progress. To lesser
degree the current recession in bust.
ness is to be attributed to the indis.
position of our railroad managers to
60 into debt to purchase supplies in
sufficient quantities to keep our iron
and steel mills fully employed. The
increased cost of operation. especial.
OF labor. made it necessary for the rail
roads to advocate and depend upon
higher rates for transporting raerchan'
disc; and their failure to obtain such
increased revenue came as blanket
upon investment sentiment. H,wev.
er. there is already strong evidence
of a reaction in what is popularity
termed the high cost of living, and
and this must eventually reach rail.
road operation. Food and raiment are
much lower. iron and copper are cheap
err, and labor, while maintaining the
high wage scales, is nevertheless
much lower per unit of measul ement.
since, under current conditions. there
is a degree of direct efficiency that
means more work to days pay.
When there is not sufficient work for
labor, it is the id'er's and the inferior
workmen who suffer: thus there is
constant incentive for each man to
do his utmost to hold his position.
In the long run The failure of the rail
roads to obtain higher rates will nee.
essarily initiate in favor of share
holders, for there is sufficient ingenui-
ity in our railroad management to ad.
apt their affairs n compulsory con.
d;tions. To a certain extent our rail.
roads were imbled with the spirit Of
Extravaganza which comes so easily
when boom times are with US. This
extravaganza will now be curtap
labor has received a necessary check,
and the railroad situation as whole
may be regarded as having entered
upon a much sounder stage, which
can hardly fail to inspire confidence
among investors.
But reverting once more to immedi-
ate influences we have reached the
stage where we are apt to feel the
influence of favorable crop
reports. The government crop re-
port published Monday indicated har
vest of 4Se, 325,ooo bushels Of winter
wheat, which if maintained, will mean
with one exception a high record from
our winter wheat area. Corn and
spring wheat are enjoying exceptional.
ly favorable planting conditions.
The view that is desirable to take
of the stock market at the moment is
the broad view. The bond market is
already showing that improvement in
investment demand has begun, and
as this demand increases it will first
spread to the purely investment stock
and then will become less discrimin.
alive. see no reason to alter my be.
lief that advantage should be taken
by any substantial recessions to pur-
chase sound bonds and standard divi.
dend.paying stocks.