The Birmingham age-herald., 1914-11-03
Looking Ahead the Officials Have : Made Careful An-
 alysis of Business
NOT NECESSARY TO
 DRAW ON RESERVE
Rate Agreed Upon for the Common Stock Affects Many Thousands But Represents Actual
 Earnings
By HOLLAND

New York, November a.--lspeoiai.) Business prudence rather than business exigencies explains the reduction of the dividend on the common stock of the United States Steel company, from 8 5 per cent to a per cent yearly rate. Con- siderably over 10000 stockholders are af- fected by the reduction to per cent basis. But when the reasons which were regarded by the executive officers of the corporation as sufficient to justify the reduction are understood by the stockhold- CTS they will undoubtedly be persuaded that the action was wise and hereafter may lead to results which will be gratify ing.
 The management of the company con- sidered the matter from all points of view before reaching a decision. Two factors in the situation were demonstrated as mestic trade situation for the past year, or at least from January 1 until August 1. and the other was the unexpected situa- tion created by the continental war in Flu rope.
 The domestic situation was thoroughly analysed by the mbaagement. There was revealed a depression in the domestic iron and steel market which had been continued for months. There was no out lcok even before the European war be- gan, which furnished visita that showed possibility of improvement. What was disclosed to the management was a sit uation which was tersely described by Charles M. Schwab on the eve of his de- parture for Europe. Nevertheless the do- mestic situation itself might not have led the management to decide upon so great & reduction as the one which was voted Q few days ago.
 The export or foreign situation created conditions that were new, unexpected, and which could not be analysed. or |. sudden some of the large customers in foreign lands of the products of the com pany were obliged to stop orders. Their ing market for iron and steel products in other lands which had been counted upon to offset partly at least the depression in domestic business is now lost for 4 time and no one can tell when this fol eign trade will be revived
 In the argument recently made by Johl. c. Johnson of Philadelphia before the United States court at Philadelphia in the proceedings brought by the government for the dissolution of the United States Steel company, he said among other things that if the courts decide that the United States Steel corporation must be cismembered this would entail not only great loss to all classes in the country, especially to wage earners. but would be in the highest degree detrimental to busi- ness interests of the United States. For. after the war of Europe is ended. there 6 to be another war, called by MT. John- son a war of industry, and if the govern ment policy of dismembering the large corporations Is continued. then the United States will lose the only bulwark on which it might depend to stem foreign industrial and commercial invasions.
 This statement in part Illustrates one of the conditions which the managemens of the corporation carefully considered and having done that reached the de- cision that it was expedient to reduce the dividend.
 Foreign Trade
 Since the reorganization of the steel corporations it has been able to enter the foreign markets and command business which was very small before 1900. In q