Evening star. [volume] (Washington, D.C.) 1854-1972, 1913-05-04
HEAVY SELLING
UPSETSPR|CES
Weeks Continuous Liquidation
Depressing Factor Which
Mystifies investors.
LOWEST LEVEL OF YEAR
FOR SOME SECURITIES
Speculation Over Rockefeller's Part
in Market Demoralization-Rail-
way Interest.
BY w. G. NICHOLAS.

NEW iOhh, May S.-The stock market
went through a silent panic" Prices
this week found the lowest level for the
year and in many issues the lowest for
several years. Covering for short account
caused some recovery, but not much real
change Of tone. New Haven, for in
stance, went down within hailinR dis
lance OF par-an actual loss in a few
weeks Of thirty-fve points New Haven
mas been under the. harrow for a long
tlme. Under the peculiar MANAGEMENT
Oh MI Mellen and his associates. the
company more than doubled it's capitali-
zation' with very small increase in earn
lngs. The company bought everything In
sisnt In the way of competing railroads.
a network of trolley lines through Mas
sacnusetts and Connecticut, lines of
steamboats, and every other property for
which an excuse could be found for ac-
QUESTION.
The Meiien management acquired a
reputation for the ruthless expenditure
oI money and for two or three years has
oeen running behind. It has not earned
aua a,vldends for four years and is now
shouldered with a colossal indebtedness.
The great bulk Of stockholders are To-
Gated In New England and include thou
sands OF estates and members Of the ED
erly well-to-do people. Trust companies,
insurance companies and savings banks
hoIu most or the bonds and not a little
OF the stock. The outlook is bad and the
prediction of Wall street is that it is
headed straight for a reorganization. Mr..
Meller is making big fight for his repu-
tation and for the solvency of the
property.
While Mr.. Morgan was alive his per-
sonality and credit had a great deal to
90 with the maintenance of credit and
supply of capital. William Rockefeller is
also . bulwark. and so is james J. Hill.
VINO was largely responsible for the
MeIlen selection This was one of the
cases when Hill graduate does not
seem to have PANIED out to fullest expec-
tations. The almost certain decadence Of
the Dig New England system has been
one of the factors of depression in the
big general market and continues to be
SO.
tremendous selling of miscellaneous
stocks for account Of Boston has been a
feature of the market for several days,
months ago Tom Lawson had news
paper pages predicting the downfall of
New Haven. and he is given credit for
being a leading figure in the market
decline: He prophesied big breaks in
New Haven, steel, the copper stocks and
singled out many other issues for whose
future he had gloomy thoughts The
course of prices has verified his dOlOrous
predictions. and he is credited with hav-
ing made a colossal killing on the
wholesale decline that has taken. place.
1t is also alleged against Mr.. Lawson
that he has figured in the background for
account of Standard Oil interests.
Rockefeller's Street Attitude.
There has been significant persistence
in the claim that Mr.. Rockefeller has
been unfriendly to- the stock market
ever since the boom last fall, and that
he has been the wet blanket over the
entire situation. The Standard Oil party
is believed to have sold many hundreds
of thousands of stocks, and to have led
off in the liquidation of the securities Of
the subsidiary Standard Oil companies
following the sensational booms in that
list. OF this allegation there is no direct
proof, but there never Is direct proof
Of the stupendous operations of the elder
Vanderbilt and his intimate associates.
They are a mysterious and invisible lot
of persons, who prefer to move In the
dark and let the public do the guessing.
Very few of even Wall streets greatest
leaders know what is going on at 26
Broadway.
In these days of mystery all sorts, Of
wild rumors find circulation and Gre
dence. 7 have mentioned this fact in
several of my letters and have also men,
toned repeatedly the more than sus-
picion that the elder Rockefeller has
been an active, though silent, factor in
the stupendous liquidation that has been
proceeding almost without interruption
for several months. The street is giving
ear to stories about the Standard Oil
activity on the down side OF the stock
market, but lacks proof of a positive
sort.
The elder Rockefeller could have let go
of hundreds of thousands Of shares with
out seriously cutting into his vast secret
holdings Of railroad and industrial stocks
His pride received a terrible blow when
Standard Oil was ordered dissolved He
is a long enduring hater and his pride in
his personal achievement is his weak
est as well as his strongest point. He
has, for years been the most powerful
factor in the financial and industrial
world Of America In actual ability Of
performance he outranked Mr.. Morgan
at his death, a fact clearly appreciated
by the so-called king of Wall Street"
Just what part he has taken in the de-
moralization of the stock market OF late
will probably never be known, unless II
should be as a human desire to let the
public have light on the subject.
Small Railway Borrowings.
The railroads have finally rebelled
against paying usurious interest for new
capital with which to improve and better
ing bankers UP to 5 per cent and even a
fraction over that rate and then with
draw The transition from 4 per cent and
Az per cent to per cent was very sud
den although not entirely unexpected.
Many of the strongest corporations In the
United States stood the gait up to the
per cent mark, but that was as nigh as
they cared to go. REPRESENTATIVES or
capital had no money to lend below that
figure and for the time being financing
on large scale seems to have stopped.
Comparatively small borrowings are be-
ing made and cases are mentioned where
the price paid is 5ls and per cent for
short time mmodations-that means
two to FIVE years. The money situation
tied condition. How it is going to work
out nobody pretends to be able to say
with certainty Candidates for new cap
itai have not given up, however, and
they are feeling the changes as they de-
velop, hoping for the best. but fearing
for a continuation of the worst
The street is awaiting with interest au-
thoritative announcement as to the plan
of j. P. Morgan & Co. Thus far moth
ing definite has been made known. There
Is more or less gossip about friction
among the partners, but nothing definite
has come to light and it is altogether
likely the stories have no foundation in
the $1J0OO0.0D average deposit placed
at the unrestricted personal direction Of
the senior Morgan has been drawn upon
to some extent since his death, but prob
ably not anywhere nearly to the extent
busy people have been intimating. The
subject is one, however. which contains
In It the seed of nervousness and 1t is
being felt in the street.
In the minds of well informed people
those most intimate with the late Mr..