The Washington herald., 1913-11-16
Street ANXIOUS
ON TRUST PLANS
Trusts Going Slow Until the
President Makes Public His
Ideas on Corporations.
BUST OR TOREGULATE
Comment AneEt Local Security Sit
uation-Bis Eaters Small Savers.
Stocks Action to Date.
Ry i. 4. FLEMING.


this trade to become. The sales during
the first hour were 1880 shares and In
the second hour 2,000 Most of the bust
ness was confined to the leading securi-
ties, with a smattering of business in
minor stocks and the fluctuations were
generally within y point to a closing on
the leaders at practically Fridays final
figures.
Many traders refused to take any part
in the proceedings, save when a slight
advance induced selling, and then
slight reaction brought a little covering
and the steady closing. 1t was a waiting
proposition, waiting for the coming of
another week. of something definite
about Mexico and the Mexican situation,
something concerning the reportSd heavy
falling off in steel business and an indi-
cation as to the prospect of the railroads
being able TO meet obligations.
More than this the average investor
wants an expression or the plans of the
Executive with regard to future opera
tiOns In trust busting. The President has
stated in plain English that, following
the currency legislation he will outline
his plans on trust busting, regulation.
&C.
Seriously this is one Of the most seri-
Dus propositions that the administration
faces. If the work is to be undertaken
along lines that will disturb every big
corporation, and that's the way the bus
mess of today is being done. then the
present uneasiness will be continued and
the present price range weakened.
During the last few days there have
been evidences of negotiations for a ces-
sation of the Steel Corporation. although
the chances are that this case will go
On TO the highest court as the govern
ment seems to have selected ii as a
shining mark.
No statement has been given out by
the Attorney General of tine petitions TO
the Department urging 4 stoppage of
the prosecution. Chairman Gary is not
inclined. judged by recent expressions. TO
make any concessions TO the govern
ment and the evidence has been more in
favor of the corporation. as the case
nears its ending
What the country needs and badly, is
an understanding of the Presidents po-
sition on corporations. The corporations
want TO know what they can do and
then they will 90 it. A little wise regu-
lstion by the state. referring to the
national government rather than a
declaration of intent 10 enforce the Sher
man law to the letter would be much
better for the whole country.
Has Not Been Beneficial.
1t does not need that one should not
be prejudiced to realize that the Sher-
man antitrust law, in so far as its en-
fOrcement in the Standard Oil and Amer
ican Tobacco cases has been, but so
much water on a ducks back as far as
the lowering of the cost of products or
tending to make times better for indie
pendents Both companies in their sew
eral entities, after dissolution. prospered
to a mere marked degree than either
did alone as corporation; both these
corpora ations were known as wicked
trusts; both had been muck-raked to
a fareyouwell, and both were in
measure vicious.
The corporate soul today is better. less
antagonisuc. partly because it realizes
that the old regime has passed away.
Americas greatness made the greatest
strides in the era OF Capitalization of
capital and endeavor the era of the Steel
Corporation.
The Sherman law has disturbed Amer
lean manufacturing industry more than
the tariff changes, Mexican situation.
currency law, &c. and recovery would
regulation of control, rather than Of at
tempted busting.
Railroad Earnings.
Railroad earnings are keeping up fairly
well, largely on account Of crop move
ment, but with lessening tonnage from
factories and more conservative buying
and distribution of merchandise, the
earnings are not likely to hold. Liberal
buying is going on for the holidays, but
other than in this class of goods. the re-
rairments to depleted stocks is the limit,
as a rule.
Railroads have an enormous amount Of
short term obligations maturing within
the next few weeks and it will be in
teresting TO find just how they plan to
meet these maturances. Many of them
cannot be matured. A glance at the
stock list shows many per cent stocks
selling close to the $50 share market
per cent bonds of responsible cor
porations around 20 to so. and some good
to 10 per cent stocks close to the par
point.
Still investors will not take chances
on laying them away even when they
are cheap. The income tax muddles and
is working against bonds other than
State and municipals.
Financial interests would have well
coined stamp tax as a compromise
measure on the income tax with its in
congruities and inexplicable language.
Steel Matters.
This month shipments will hold up we'll.
and the full dividend may be earned.
But December, unless there is decided
Improvement. will report earnings very
close to dividend requirements. Should
United States Steel in December ship at
the rate of 11,000 600 tons per year and
net profits per ton average 50, net earn
ings would be at the rate of less than
800. 10000 a year. II requires earnings
of between S1O0.00OOOO and $1O5, 900 a
year TO satisfy interest. depreciation, Z
per cent on the preferred stock and
per cent on the common.
Owing to increased costs, amounting to
something like $50 per ton, compared
with a year ago, the Steel Corporation
cannot afford to allow steel prices to
go down to the level reached in 1911
Since 1911 costs have increased much more
than that. The increase in wages granted
this year was equivalent to an increase Of
approximately 81 per ton in the cost of
steel production.
In connection with United States Steel.s
dividend prospects. 1t is interesting to
note that including this year the Steel
Corporation will have spent in the last
three years nearly 800, 100000 for new
construction. Surplus after dividends in
the same period. this year estimated, will
amount to approximately $4,000, 600
Therefore. the Steel Corporation's ex-
penditures for construction in the three
years have exceeded final surplus by
about $57.0O0.oo0. HID the corporation ap-
propristed from surplus sufficient money