The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1916-09-12
Capacity Business for Cor
poration in Sight for
Next Two Years
MANY PURCHASED
STOCK BELOW TEN
Perkins Has Said That Ore Holdings
in the Northwest Are the Full
Equal Value of the Com
mon Stock
Ry HOLLAND

the day when the reorganized and reJu-
venated Reading Railroad company's
stock was quoted as having touched
and crossed par, the late J. P. Morgan,
with a bit of tape in his hands upon
which the par quotation for Reading was
recorded, Joined his partners while they
were at luncheon in the basement of the
old banking house of j. P. Morgan &
Co. Mr. Morgan held up the tape ex-
ultantly and said to his partners that
those stockholders of the Reading who
were not frightened into disposing Of
their stock, but instead held it, would
in this quotation find their faith in the
property vindicated One of the partners
who heard him make this statement said
that Mr.. Morgans first thought was for
the stockholders of the Reading, although
he may little later have felt some
sense of qualification that the reorgan-
alton had resulted in such success.
The late Norman B. Ream, who was
one of the original group that organized
the United States Steel corpora ton, said
about a year before his death that Mr..
Morgan was always persuaded that che
day would come when the common stock
of this corporation would be quoted at
par or better and hoped he would live
long enough to read par quotation. Mr..
Ream was also of the opinion that the
day would come when the stock would
cross par All that was necessary for
a quotation of that kind to be obtained,
he said, was improvement in general
business and especially change in the
attitude of the public toward the railroad
companies of the United States.
George w. Perkins, in speaking OF the
~. -
years ago, said that the public forgot
that the interest of this corporation in
certain ore properties in the northwest
was up a fair valuation fully equal to
the value of the common stock even
though the quotations be as great as
par,
OF course the men who are familiar
with all the details of the situation in
which the United States Steel corpora
ton now finds itself now feel justified in
purchasing the stock in large blocks.
Some of them may have done this from
speculative motives. There were undoubt-
eddy large blocks of stock upon the ris-
ing market chiefly forA the purpose Of
taking profits. Many persons bought steel
stock within the past year when it was
selling at 80 or little more. No doubt a
considerable proportion of those who
made purchases of this kind were tempt
ed to turn their paper profits into actual
cash. They found a ready market FOR
their offerings and the impression is
strong in the financial district that the
passing of the United States Steel COM
mon stock above the par line may posi-
bly, reflect further increases in the quo
tations for that stock
A WORLD PHENOMENON
The gradual appreciation in the market
value of the common stock of this corpo-
,1+ to-, I,n = 49,, Nd So
days ago is spoken of as the greatest
phenomenon of industrial business not
only in the United States, but in the
world All of the water If there were
any in the common stock of this corpora
ton, was squeezed out when the quota
ton for it was a fraction above IS a
share. There were some who were ven
turesome or who had faith in this prop
erty who bought large blocks of this
stock when the quotation was below ten.
One conspicuous example of this was that
of a publisher who is reported to have
bought approximately a hundred thou
sand shares when the quotation was
around ten and who was able afterward
to market his shares at prices in excess
of $50 per share. This one venture made
OF that publisher very wealthy man. A 4
part of his profits he put into United
States Steel preferred, holding at one
time million dollars worth of this pre-
ferred stock and explaining the purchase
to his friends by saying that he had put
the stock aside, locked it up. intending
to hold it in case he met with business
reverses, so that through the ownership
of this stock he could be fairly we'll pro-
tected.
One of the explanations given for this
appreciate ton in the market quotations of
the United States Steel common stock isl
that it was inevitable because of the
earnings of this corporation, traceable 10
war orders, were very great. This ex-
PLANTATION is not exactly accurate. For
although the increased business of the
corporation undoubtedly Is traceable 10
the vast accumulation of war orders
nevertheless the corporation itself did not
accept any orders of that kind About
66 per cent of it's commodities were
bought by exclusive industries that made
war munitions It's products were mar
keted to a great extent with industries
which were engaged in manufacturing
war material, but with the purpose which
lay behind these purchases the United
States Steel corporation had nothing to
do. 4
Part of the great earnings of the cor
poration is traceable to the increase in
its export trade. That began in 1893,
shortly after James A. Farrell. who is
now president of the corporation, organ
lied the foreign sales department Two
years ago, when the output of the various
plants of this corporation was not more
than SO per cent. of the capacity. much of
this capacity was occupied in filling
orders for foreign markets.
NOT PURELY SPECULATIVE
or course. it is inevitable that in great
and rapidlV apnrecjatiup ma rlat uh