The Washington times., 1912-07-14
WALL STREET PESSIMISTIC DESPITE
FAVORABLE NEWS FROM THREE SOURCESF.
Government Crop Report Favorable Increased Orders for Steel
era Sales Fail Cheer the Brokers and Spectators
cal Dtric-News and Comment Center of Operations.
BY JOHN GRANT DATER,
Special Financial Representa,e Munsey Publications

! oil agricultural products. At this time
perhaps. a little more concern is given
10 the reports of the appearance OF
rust In the spring wheat belt than to
anything else connected with crops in
consequence of the diminished wheat
yield In the Northwest in the last two
harvest seasons. The shortage there
mas been felt severely by the railways
traversing that territory and Is in a
large measure responsible for the poor
showing Of the St. Paul road, the de-
cline In the stock of which was one
OF the most disquieting features OF the
Closing session OF the stock market of
the week,
Railway Net Earnings.
The sharp break in st. Paul stock and
the general heaviness Of standard rail-
way issues, was one Of the least agree
able features of the week and directed
attention anew to unsatisfactory condi-
tions prevailing with many Of the lead
Ing transporting companies of the coun-
try. Here and there is a notable ex-
ception, of course, as in the case of
the Baltimore and Ohio railway, which
during the week made almost the best
showing for the year ended June 30. in
Its history, and there are some others:
but 1t Is really becoming exceptional
for an important common carrier to
show satisfactory net earnings
For instance, during the first Ave
months OF the year the New York Cen
tral system shows a gross increase OF
s2o. 900 compared with 1909, but the
affiliated companies earned 500, 900 less
in net. The gross Increase of the Penn
sylvania system for the same interval
is shown to be 81, ,914,0S1, OF which but
A0S, ,214 has been saved for net profits.
/ The heavy increased cost of conduct
| ing railway transportation quite natur-
ally Is receiving much attention, and
II Is reasonably certain that affairs
cannot continue as they are. without
working some, very serious injuries,
/ both to the railways and the entire in
dustry of the country. Fortunately this
| has not proceeded so far as to seriously
threaten dividend payments with the
majority of the railroads. but the alb
cannot continue Indefinitely withou,
harmful result with some companies
The difficulties which the steam rail.
| ways have been experiencing In secur.
| ing funds for needed up-keep and i'm.
| provements have already been referred
/ to In this column, and they are of course
! accentuated by the unsatisfactory net
| earnings, which many larger systems
have been showing OF late. In fact, the
situation of net earnings diminishing
| and the old type of railroad bond be.
| coming practically unstable, except al
| sharp concessions, Is regarded by some
extremists as foreshsdowinS a crisis
in the railway transporting industry.
Bonds and the Bank Statement.
The difficulties in finding a ready
market for investment issues Of the ole
| familiar type is not. however, confined
to this country alone, as is evidenced
by the continued decline in consols and
high grade securities abroad. Tn,
| premier issue was again under selling
pressure in London during the week
and established new low records for tn,
present movement on two separate oc
casions. Bonds bearing per cent in
terest. bought at or about par, are Vir
tually the only securities which are find
| ing a ready sale in the local investment
market, and with this class only wal
| there any appreciable evidence of
| reinvestment OF the huge amount o.
money discussed on July ].
AS was clearly foreshadowed by tn,
| calling of loans and the advance In tim'
| and call money rates, which was IL
progress throughout the entire week, tn,
bank deficits were made good in tn,
| statements of Saturday. This was &C
complished chiefly, however, by an ex
tensive shifting Of loans among insti
tutions.
Loans decrea sed $50, ,S6S. 900. and deposits
| contracted $50. .207, 900. while a loss o.
| So, ,673, 900 was reported in lawful money
| The report of actual conditions reflected
a contra ction OF $37, 900 in loans ant
| OF $26, ST., 900 in deposits with a cash gaiI
of IS, ,029, 900. In the one statement tn,
| reserve increased 81, ,246, ,150, and In th'
other SIG, ,119, 000 which Is sufficiently a
, variance to indicate that the New Yorl
bank statement at best Is a Sphinx
riddle at times.