The Birmingham age-herald., 1911-05-14
STREET HAS EYE ON SUPREME COURT Thinks Everything Hinges
 on Big Decision :. BLIND TO ALL ELSE This in Spite of the Fact That Crops Promise to Be Most Enormous
 in the History of the
 Country 
By ". G. NICHOLAS

 up its mind many weeks ago that no im- lportant move could safely be made in speculation until the shighest. court had placed a construction on the law for the Ireguation and restriction of trust opera tfons, and nothing can shake 1t from that position. The whole business and indus- jtrial world has stopped until this one point can be decided. It is very strange situation. It is more than likely that when the decisions are handed down they will have been discounted, but In the present mood that counts for nothing. The determination having been made to wait for the supreme court nothing can lchange the mental attitude Mexico may be disrupted and 100000 soldiers of the United States take possession of the country: that would be matter of minor importance to what the supreme court might say about Standard oil and To- bacco. The substitution of free trade
 for high protection might cause momen- tary ripple among the speculators, but it would be voted a mere incident in com parison with that momentous decision now being framed up by the nine mem- bers of the supreme court bench. There may be bumper crops or crop failures, I it would be all the same in the minds of that numerous and powerful element which has decided in it's own mind that no forward step can be taken in business until it becomes definitely known whether or not the oil and Tobacco trusts will be allowed to go on as they have been do- ing or compelled to reorganize to save themselves from the penalty of outlawry. All this looks absurd. It is absurd, but nevertheless, that Is the Wall street status at the present time and nothing seems able to change 1t. That pending court decision is held so closely to the eyes of Wall street that the vision is oc- scured for everything else.
 The two corporations directly affected represent all told probably one-quarter of 1 per cent of the valuation and the property interests of the United States. Standard oil is capitalized at s1oo,O0o coo, it's tangible assets may be $250,OQo,0Oo and selling value of it's stock is about s650,0 ,000,- oC0 The difference between the asset valuation and the selling price of the stock. namely s4OO,OoO,ooo is organization" that is, the machinery which has been built up through a period of 40 years for the handling of the oil production of the United States and part of Europe. It is probably the most perfect organization lin the world, and every other important industrial is modelled as nearly like it as possible The Tobacco trust has a stock and bond capitalization of approximately s40O, 100000, counting in the stocks and bonds of auxiliary concerns. It's tangible assets may run as high as s150,00O, 0O0. Its lsecurities have a market value of about. $500 900. The difference between s15o,- 900 and s5o0,000,o0o represents good will, brands, labels and above all ''organza- tion.'' It has a selling and distributing machinery as complete and monopoistic as Standard oil, and in some respects its methods for killing competition are even more efficatous than those of the big oil monopoly. Both of these colossal industrials make more money than they know what to do with. Standard Oil has lstupenduous cash reserve fund, as large or larger than the Steel corporation, but It's methods of distributing profits are direct. The Tobacco trust makes as much money as Standard Oil but it's gets the surplus revenues to It's owners by various means of indireetion. The bond issue of $125.0O0, . I coo is one of the ways of distribution. I Those bonds represent in fact little. more than scrip dividend on which per cent is paid annually. l are redeemed but such redemptions seem | not to reduce the visible supply of bonds | One of the features of the Tobacco | trust capitalization Is the issue of ESQ., 900 OO0 per cent preferred stock, which is selling at around ST. The s40,000.o0O in con- mon stock sells around 450 The preferred stock has a preference over the the com mon stock as to division of the assets l in the event of dissolution of the com pany. Should the supreme court. compel reorganization it might occur that the owners of the preferred stock would come | in for a sensational melon cutting minority of both classes of stock is quite widely distributed but control of each is | held by a limited few comprising the l original founders and developers of the business-the Duke family, the heirs of the late William C. Whitney, Oliver Payne, Thomas Fortune Ryan and his sons, and possibly a dozen others. most of whom are entirely unknown to the | WOFiu dt ldT6e put cdcH poooSSohiS iho"JS many millions. The Tobacco trust group has as much ready cash as any com bination of mlIionaires in Wall street. The business of, the country has been lhung up for months over the issue of
 whether two groups of multi-mtllionaires shall be obligated to change their meth-
 odsl of selling petroleum oil and to- bacco. F | Wall street is resigned to this remark able state of affairs because 1t believes
 great banking combinations are com mitted to a waiting policy. Indeed, 1t has been made clear on many occasions thatit is the desire of the interests In control of the money situation that the stock market should hold off until,it could
 be definitely known what organized cap- litaf would have to do In the way of re- Organization Such being the case people of moderate means, and even of large means, felt they would be taking an un-
 wise risk by going contrary to the or ldained programme. Of late that part of the investment and trading public residing outside of Wall street has been recon ciled to the waiting play by reason of ithe fact that Congress is tinkering with l the tarin. Throughout the country man ufacturers and merchants are sailing close to shore on the tariff account producing and handling in quantities sufficient only l to supply day by day demands. The outside public is also mindful of the