Evening star. [volume] (Washington, D.C.) 1854-1972, 1911-02-26
GUESSES ALL WENT WRONG
Financial World Had Accepted
Theory of Half Loaf.
l NEW ERA IN BUSINESS
One-Man Control of Vast Industries
Is Giving Way to Control by
Groups of Capitalists.
By w. G. Nicholas.
Special Correspondence Of The Star.

ny w. W. XNlCUUldS.
Special Correspondence Of The Star
NEW YORK, February 25, 1911
The decision of the interstate com
merce commission, which came as a
total surprise and shock, Thursday at
| ternoon, Knocked the breath out of the
stock market. Never had an important
decision been more successfully safe
guarded from the Washington and New
York news scouts than this one. In
the absence of facts the mind readers
who were on the job at Washington
had "guessed'' that the commission
would hand down a compromise verdict
giving the western roads little more
than half they had asked for and the
| eastern roads little less than half
So confidently had this forecast been
handed out that 1t was generally &C
cepted at it's face value. The result
was that between the close of the mar
ket Thursday afternoon and the open
ing Friday morning London had mark
ed down American quotations 2ha7
points. and the opening on the New
made by London. At and around OPEN
ing quotations more than 100000 shares
were sold. From that level the market
recovered slowly, gaining considerable
nerve, however. along toward the close,
which registered a recovery Of about
half the loss.
Makes Government Responsible.
In spite Of the grand chorus of lam
entations handed out by railroad
presidents. railroad lawyers, and many
OF the leading bankers and 'financiers
Of the country there is a deep seated
conviction that the decision will in the
end prove beneficial to corporate Sc
curit1es. The decision establishes for
the first time in definite and official
form the principle of governmental
control of railroads and by its assump-
ton of such responsibility places the
credit and protection Of the govern
ment behind organized business 1t in
jects new quality of value into rail-
road stocks and bonds
About the worst the railroad man
ayers have to say is that the dec4sio
Will delay or put stop to grand plans
for spending money, which money they
expected to raise on the credit which
would go with decision giving them
the right to tax the public $4,000 900
to $100.000.000 more every year for
freight than it is now paying The
roads will now be obliged to get this
money in large part by economizing in
ness-something which in the end may
rebound to the advantage Of the stock
holder.
The market has become two-sided.
Those who look for resumption in the
upward tendency Of prices are conv
that the country will continue to gov
and that it is at the present moment in
the early stages of a period Of splendid
progress. Those who take the opposite
view honestly believe, foI the most part,
that improvement to last must start from
sound basis, and that, they are not
prepared to admit, has been established
as yet. The strong point they make is
that the technical conditions are such
that drastic Liquidation in certain quar-
ters must take place before there can be
permanent advancement.
Copper Market a Problem.
The particular thing that engages their
attention is the copper market-shares
and metal They are outspoken in de-
claring that important interests identi-
fed with the copper industry and with
speculation must be brought within safe
limits before the really controlling fac
tors Will consent to any boom icing at
tempted. In this they may be and prob
ably are right, yet it must not De forgot
ten that just that kind of talk had pre-
ceded every impO. tant merger or unifica-l
ton OF warning elements. 1t was heard
for q year PRIOR to the giant combine
which is now represented by ...e United
States Steel Corporation, with It's share
and bonded capitalization of more than
81. 500, 100000. Everything was going to
pot. The various big steel manufacturing
companies were extending plants in a
way to insure ruin for all. The only sal
walton was to bring them together in
one combine, and this was done by Mr..
Morgan. After ten years the plan has
proved to be a success.
There may be general big enough to
merge the great copper companies. Sew
eral strong men have been at work on
the job at various times tor the last year
and a half. When the Supreme Court
hands down Its decision in the pending
trust cases the project will be revived in
earnest. and leading spirits in the copper
world will once more struggle to bring
about a combination able to control pro-
duction and keep it within bounds. Until
such time the copper situation is likely
to be a menace to the stock market-and
maybe very serious menace.
Gould Adjustment an Example.
On the other hand, the matter may be
adjusted as quietly as that other great
black cloud, the Gould properties" by
which term was included the several cor
porations dominated by George ]. Gould
The Gould personality was effaced with
out anything happening to break the
market into flinders. as many feared
might be the case when the actual deed
was done. Instead of being menacing or
explosive. Mr.. Gould proved docile as a
lamb and stands for the diSciplining
without visible protest. He yielded to
the inevitable and meekly takes the back
seat that was assigned him by his dear
friends, the great banking syndicates,
who had undertaken to regulate him out
of high position. Now If the Guggen-
helms will be equally tractable when it
is their turn to be set back and dis
ciplined there may be no copper disaster.
If they get ugly and try to run things
with high hand, lookout for trouble
trouble with big T.
Just where the Missouri Pacific sys-
tenn, which is the principal Gould asset,
will land, nobody has yet been able to
state with authority. It may be MAIN
tanned as an Independent proposition or
it may go to other systems. The one
thing that stands ont MAINLY 10 that be-