New-York tribune., 1912-08-12
FINANCIAL CONDITIONS
IN LONDON BRIGHTER
Undercurrent OF HopefuneSS,
Based on Worldwide Re-
ports of Good Crops.
RAILROAD OUTLOOK POOR
Reports Show Decline in Reve.
nue and Decrease in Ex-
penditure on All Lines
Dividends Smaller.
rBy Gable to The Tribune :

rBy Gable 70 The Tribune
London. Aug 11.-There was but lit
te business on the stock market last
week. but the general tone was good,
with an undercurreut of hopefulness
that promises well for the future.
There has been some small buying Of
home rails, while Americans were up
generally. In anticipation Of good crops
and a general revival Of business
crop reports from all over the world
are good and this has had a great deal
70 do with the better tone Of the mar
ket. as crops Of course, are the founda-
ton on which all prosperity is built.
Consols have been fairly steady at
around 741s for cash. and money con
tinues in fairly good supply. Loans
until Monday were made al , per cent,
and weekly fixtures al %.
Discounts remain firm. The Bank Of
England's rate holds az per cent.
cold withdrawals for shipment this
week amounted 10 $500 600 Re
ceipts. however. were slightly in excess
Of this amount. and under normal con-
ditions this situation can be counted
upon 10 continue and relieve the Sank
from the necessity Of competing for
gold with South America and the
Inited States. There are, however
some uncertain factors. Trade In
South America is active, prices are
good and crops large on the other
hand. South America is buying abroad
on q large scale, and it is possible that
imports will largely pav for increased
exports. Nevertheless. IL is almost Ger
tain that the considerable shipments Of
! gold required 10 provide currency for
the crop movements and other business
needs in the United States will be the
lcentre OF interest
Demand Ahead for Gold.
Should trade with America become
very active the demand for currency
will greatly expand. and II will prob
ably be necessary for New York TO i'm
port gold. There seems 20 he little
doubt that there Will be an active de
nsnd for gold within the next few
months In several countries. partly on
account of abundant crops and partly
owing TO the general activity IN trade.
The Bank Of England reserve de-
olined last week S4.615.OO0 20 $40
10000. and the net loss Of gold was
s5155. 600 making the gold held Sl9S,-
10000. The proportion Of reserve 10
liabilities was 4sS per cent.
The reports Of the eleven principal
English railway companies for the
last six months show a decline in net
revenue Of Ss122.77O and an increase
IN expenditures Of Sj67.3OO AS re-
suit Of these changes dividends show an
! average decline Of ! per cent, the Great
Northern. which pays 3 per cent. being
The only road not 10 reduce its divi-
dend.
The decrease in revenue is, OF course,
laid 10 the coal strike and the other
recent labor difficulties, while the high
or prices Of coal and supplies and the
revision Of wage schedules account for
the increase in expenditure. There was
a loss OF approximately S2O.COOoO in
freight traffic during the six weeks Of
the coal strike A large part Of this
was recovered before the end Of the
half year, but the loss on passenger
traffic is. Of course, permanent. The
loss Of revenue, therefore. is transitory,
but the increase of expenditures is not
only permanent but progressive, as the
cost OF coal and supplies Is constantly
advancing TO a higher level. and wage
revision schedules also provide for pro-
s7,essive increases for certain grades Of
employees.
Burden Of Insurance Act.
In addition TO these extra expenses.
the insurance act now comes to add a
very considerable burden to the charges
of the railroads. so that on the whole.
though the prospects Of passenger and
freight traffic for the coming half year
are i6NOfdDlc. WHdL Will TIC N4'9NNN'NN
state OF the labor market and the per-
manent increase In expenditures, the
railroads have rather a difficult situa-
ion 10 face. with no compensation IN
sight for added charges.
The government promised in August
1911. that the railways would be al
lowed 20 raise their freight rates, and
1t is true that a bill providing there
FOR had been introduced into Parlla-
ment, but il has gone no farther ana
in the opinion Of many members the
government intends to let II Ole. AS
there seems TO be no purpose OF per-
hitting the raising Of freight rates the
government might offer some reilei lo
the roads by the abolition OF the pas
senger duty and the reduction OF local
taxation on railways. 1t Is evioehtly.
ho,ra,.or NJ ar-t ~ the programme OF