Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1914-10-22
Suggestion Is Made That
Freight Rate Increase Would
Make Everybody Feel Better
About Situation,
NEW YORK BANKER IS
EXPERT ON SUBJECT
Hearings on Application of
Eastern Railroads Bring
Out Interesting Testimony
From Witnesses,

Washington. oct 2i-~Thc psycho-
logical stimulus to business thai
might be effected by general per
cent increase In freight rates should
be the chief consideration of the In
terstatc Commerce commission. Il was
declared today In tho commissions
hearing on the renewed application
of the eastern railroads
The psychological aspect of the sil-
uaiion was laid by Lawrence Cham
herlain, New York banker, who
spoke for the Investment Bankers as
sociation.
Mr.. Chamberlain said he Knew
nothing about freight rates; his tes-
timony was devoted to detailed dis
icussion Of the railway bond market
This question ought TO DO settled
not on the basis OF railroads and
shippers" he asserted. but on the
contention of the bankers that the
country needs saving Raising rates
! Is the greatest thing that can be done
to relieve the situation psychology
eally.'
The position of the witness was in
stantly challenged hy Commissioners
Clements and Clark
Pointed Question Asked
rs il the general understanding OF
the bankers asked the former. that
this commission has carte blanche to
do anything II wants to do to meet
lpsychologicai condition? We had sun
posed this was q government of inw;
not of the caprice Of commission
We will not take any other POSI-
ton in any brief we file In this case
hastily interposed Morris Roscnthal.
counsel for the intervening bankers
We make no other contention
we come before you when In our
opinion the credit condition of the
country Is paramount Mr., Chamber
lain interiected. lie added that the
bankers had taken no part IN the pre-
vious controversy between railroads
and shippers. over rate advances.
Witness Uses Chart.
/ The entire day was devoted to hear
ing the testimony of bankers. The
cross examination of Frederick strauss
was concluded. Mr.. Strauss quoted
Sir George Paish, the English finan-
clal expert here 10 discuss interna
tional exchange with American Off
clals, as authority for his statement
that English Investors found Ameri-
can railroad securities less and less
attractive.
Mr. Strauss was followed by Mr..
chamberlain, who produced chart
showing the trend Of bond prices and
credit over many years. This, he con-
tended, showed that the credit Of the
nation as represented by rs banks
had closely paraleiled the bonds up to
1910. At that time, he said, the
credit situation Ind broken away from
the railroad securities which were IN
a decline lie explained this BY say
/ Ing that other securities, such as pub
lie service corporation and municipal
bonds, had been growing in popular
ity largely because of government aid.
either federal or state. extended 10
them.
Counsel for various shippers or
iganizatio and special counsel for the
commission took sharp issue with tho
witness on the question OF the rela-
tive attractiveness to foreign inves-
tors Of railway bonds and the securi-
ties Of public service corporations
,and industrial concerns.
Louis Brandes and clifford Thorne
drew from Mr. Chamberlain admis.
sions that at present the yield Of in
dustrial securities is 1 per cent higher
than that Of railway bonds and of
public service securities hnlf Of l per
cent higher The YIELD II was ex-
planned. indicated the rate corpora
Itions were compelled to pay for hor
rowed money and showed the credit
Iof the railways still to he better than
that OF other concerns.
Securities Bring Good Price
In the course Of his cross-examlna-
tlon Of Mr. Chamberlain, Mr.. Thorne
asked
Can YOU name any class of compa-
MES in the United States engaged IN
any other line of business than the
railroad business, either industrial
manufacturing, street railway, gas and
electric light, telephone aud telegraph
or any other general class of manu-
featuring Industrial companies rs
class, that command as high prices
as railroad securities of the same de-
nomination p
"The railroad securities still have
the advantage in credit fl Is getting
less year By year, but they still have
it," Mr. Chamberlain replied.
In other words the credit of the
railroad is the hlghest?
Yes
"Of all companies In bnsiness?'' in-
sisted Mr.. Thorne.
Yes