New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1916-05-29
Rise In Railroads Fails to
Bring Public Back to
the Market.
INDUSTRIALS MAKE
LITTLE PROGRESS
Great Britain to Tax Out Our
Securities-More Gold Here
from Canada.

/ that bought stock so eagerly year
ago went the campaign in the railroads
was not a success. On Monday morn
1 ing, when it had been hoped buying or
ders would be heavy after consideration
over Sunday of the strength in the
carriers, purchasing from commission
houses was decidedly disappointing.
The upward movement, however, was
carried on for a while in spite Of this
lack Of public interest, but it soon be-
came apparent that good deal Of this
was 10 enable those who had bought
lower to distribute at better prices
For most Of the week a good part OF
the business was done in the railroad
list and when trading shifted TO tie
industrials the upturns produced were
without much vitality. The transporta-
ton stocks have possibility Of better
appeal because they have in the last
two years risen in appreciation OF the
improved position of the industry.
Large profits are being piled up from
the abnormal traffic the war has start
ed. Whether or not stockholders re-
ceive immediate returns in higher divj-
dend rates or special disbursements,
the value is there, and after the lean
years that have passed present large
receipts are not being wasted.
Last week earnings statements of
large systems for April, save where
special causes, such as the anthracite
dispute, lessened traffic, showed that
the volume of goods being moved was
still great. How soon these earnings
will appeal TO the speculative and in
vesting public there is no tolling Rail
road stocks have suffered compartive
neglect because of their supposed lack
Of speculative possibilities through the
publicity Of their operations, because
of fear of heavy selling by foreign hold
ers and, recently, because of the de-
mands Of employees. not yet settled.
Railroads Attacked Own Credit.
Besides this, to prove their case for
higher freight rates, the railroad man
ayers presented a doleful picture Of
the prospects of the transportation
business in this country. Week after
week, month after month, the public
was told that, between rising costs Of
labor and material and rates fixed by
unsympathetic regulators, railroad
profits were disappearing and credit
was being destroyed. Was it unnat-
ural that constant reiteration Of such
complaint brought railroad stocks into
disfavor?
Now the business Of carrying goods
from one part of the country to an
other has suddenly grown so great
that the roads can scarcely handle il.
Rates have been raised a little, and
economies learned when times we're bad
have helped keep down expenses. The
result has been that the fiscal year
from July, 1915, to June, 1916, will be
the most prosperous the railroads of
this country have ever seen.
There remains the demand of the
unions for shorter hours, another name
Tor higher wages. To lines just on the
brink OF bankruptcy or trying to
emerge from that predicament. the add
ed expense will be something of
hardship. Successful systems will
hardly feel the additional sums they
have to pay, though later, when the
expected contraction comes with peace.
the story may be different
London Selling Light Recently.
Foreign selling, particularly selling
for London account, where our securi-
ties are being gathered by the govern
ment TO steady exchange, has reached
considerable volume since the begin
mig of the war. In the recent rise
of railroad stocks there was not enough
Of such liquidation perceptibly to check
the upward movement. For this two
explanations were offered: First, that
the supply Of our stocks held by the
British authorities had run out; sec
ond, that selling for London account
was held back so as to get better prices
later.
Bonds from England were steadily
offered for sale, and in the investment
houses IL was expected that plenty
more were on hand TO be thrown on the
market as II was ready TO absorb
them. AS TO the amount OF stocks held
for disposal there was no agreement.
Announcement that q special tax of 10
per cent was to be laid on income from
our securities desired by the Ex-
chequer indicated that the supply was
not large enough TO satisfy British au-
thorities.
Such an unusual discrimination
would not be made in a country that
long had prded itself on offering a
broad free investment market unless
the need had seemed pressing. lnsti-
tutions, according to what was known
here, had turned in the American
stocks and bonds they owned without
reserve. This latest pressure is appar
emily to be directed against estates and
ether private owners and must mean
that the available supply is running
low or that extraordinarily large eX-
penditures here are contemplated
Sterling Exchange Still Weak.
Sterling exchange was not held firm
last week, though gold shipments of
some s6,000,000 brought the imports
from the Bank OF Englands supply in
Ottawa this month TO over 100000
London wishes TO keep exchange
steady, and recognizes that another
bad break once started will be cumula-
tive in its effects. Money rates have
been kept high in the British capital
so as to make it profitable for Ameri-
cans TO leave funds there instead Of
drawing on them at once. When fall
ing exchange brings in question the
future value of such balances they are
likely to be shifted TO this side, adding
to the pressure against London in the
process.
Here money continues abnormally |
easy when the volume Of business
under way is considered In this city
surplus reserve. now under $50 900 900, !
has been reduced more than 100000 |
600 since January; yet the return on !
Lankinc Funda has shaun scarcelv INV