New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-06-22
Expected Rate Decision
Still Checks Market
Movement.
ROCK ISLAND BACK
TO FIRST PRINCIPLES
Federal Reserve Act Nearer
Operation-Exchange Rates
Lower-Gold Exports.

ket here was dull, waiting hiaH' "
tention Of traders being still fixed on
the possibilities arising from the ad-
vanced rate decision. Frequent au-
vices came from Washington purport-
ing 10 tell the conclusions arrived AT
nv tho Interstate Commerce Commls-
sion hut in few instances were these
considered OF enough moment TO IN
fuence the market. The daily turn
over Of shares on the exchange was dis-
couraginglv small, and represented
about the minimum Of speculative &C
tivity. Investors showed no signs OF
onticipating a favorable decision, but
there was no indication Of any ten
dencv toward general liquidation.
Bonds changed hands more Freely
than stocks. Since the first OF the year
transactions in bonds are considerably
ahead OF those in 1913, but for the
last four months or so this movement
is accounted for more by shifting OF
holdings 10 more desirable issues than
by an investment demand. Last week.
Of course. the Rock Island reorganiza-
ton plan accounted for large proper
ton Of the bond business.
After the market has digested the re-
suit Of the rate case other causes OF I'M
certainty will apparently remain. IN
less a decided upturn comes IN the gen
eral business Of the country the market
may well be expected TO fall again into
a waiting attitude, in doubt over the
federal antitrust legislation. the work.
ing OF the new bank act, the result OF
the Congress elections and the course
Of the crops. OF these the harvests
seem TO hold promise Of definite out
come that may perhaps outweigh all
the uncertainty arising from the rest.
recognizing the Rock Island
A noteworthy announcement Of the
week was that Of the agreement on a
plan for reducing the Rock Island edi-
fee Of holding companies back to the
foundation railway, with the elimina-
ton OF 1857, 900 900 Of securities. The
original underlying company has been
able TO meet its fixed charges, and they
are not increased in the proposed re-
organization. Some S30,000,O00 add
tional funds estimated as necessary for
the present to put the property into
good working order are provided by a
new issue Of per cent non-cumulative
preferred stock.
Long negotiations have been neces-
sary to bring about an agreement be-
tween the committees representing the
shareholders Of the Rock Island Com
pany and the owners Of the collateral
trust 4 per cent bonds Of the Rock
Island Railroad, the middle concern OF
the threefold structure. These bond
holders appear to have prior claim tc
control OF the underlying Chicago
Rock Island & Pacific Railway. the
great majority of It's stock forming the
| collateral on which their securities are
based.
To obtain needed funds and to con-
tinue the present efficient management
which may be expected to rehabilitate
the road in credit as we'll as in physi-
cal property, the bondholders are to
| give up 371b per cent Of the railway
stock after it is bought in under fol
closure proceedings. This will go ia
those OF the Rock Island Company
shareholders and those Of their own
number who subscribe to the new Issue
| given owners OF Rock Island Company
shares to subscribe for the new securi-
ties TO the extent of Is per cent Of the
par value OF their holdings, the coin
mon stock holders receiving also 1OS.
per cent in common stock Of the rail.
way and the preferred IA. Holders Of
the collateral trust IS may subscribe In
! similar proportion for the preferred
stock, receiving an additional IA per
cent Of the railway shares. They will
also have the first call on rights not
exercised.
Establishment Of the new banking
system was brought nearer through the
submission to the Senate of the names
Of the five men selected to serve on the
Federal Reserve Board with the Secre-
tary of the Treasury and the Controller
of the Currency. Business men OBJ
tanned some encouragement when they
considered how much better were the
appointments than they had feared
when the organization committee an.
noun, its division OF the country int
districts. The presence of three Office.
holders under the present administra-
ton is, of course, not wholly liked, but
there is hope that the experience Of the
banking members may be allowed "a
guide the deliberations Of the body
Though some opposition, it is reported
will be made in the Senate to confirma.
ton OF the Presidents choice, il is be.
lieved that all will finally be confirmed
The board should be allowed to begin
its deliberations at once. Despite de-
lay in completing lists of nominations
for directors OF the regional banks, II
is still possible TO complete balloting
for these places before the end Of the
month. Whether the new system is in
operation by the first of August or rot
depends upon the promptness with
which the central board is organized
and proceeds to the consideration Of the
problems awaiting it. or these proba-