The Caldwell tribune. [volume] (Caldwell, Idaho Territory [Idaho]) 1883-1928, 1916-11-03
Business and Finances
BY w. S. Cousins, Editor American Banker.

NeW DIRK, Oct. ZS.-An interesting
& deNeIopment In the railroad situation
was the announcement last week that
the New DIRK Central had voted a
b new issue OF IoU,UUU shares OF treasury
STOCK, appr oXlmateiy SZo,UUU,UUU to be
Il offered 10 present shareholders. Rail
E road financing IN recent years has to a
Il large extent been limited to short term
notes and bond issues, current net
q earnings have not made a very favor
able appeal to investors 1t is under
stood that the purposes tor which the
proceeds OF the stock distributing will
u De devoted are i'll connection with
important Improvement work.
1t IS believed that the action taken
by the directors is in preference to
increasing the company dividend on
It's present outstanding stock, although
earnings are sufficient to paw a
4 higher dividend than the present dis
bursement. 1t would be we'll for the
railroads. II this practice could become
general, for the tendency in recent
years has been to add to fixed charges
whenever new money was needed.
There is balance between that pro-
portion OF capital which should be in
terest bearing and that which should
be raised by stock sales which has
been distributed by the long period
during which transportation earnings
were not sufficiently elastic to permit
1.-THE roads to pay dividends which
Smade new stock issues feasible, but
business is now running at such a rate
as to enable the companies to extri-
gcate themselves from some of their
difficulties. Last year saw the small
Hest amount of new railway construc-
ton this country has enjoyed since the
Civil war. Only $l2,0000OO of new
capital was added last year to an in
svestment of $l6,OOO,OOO0OO, which is
perhaps accounted for by the fact that
there are $4,000 miles of existing roads
which have not ben able to pay in
terest charges on the bonds they
carry.
II Stocks and Bonds.
"a New high records for Bethlehem
Steel, General Motors and a general
advance in rails and industrials were
inc features OF the opening sessions of
This weeks stock market. After its
sensational rise from 80 to 600 last
year, the interest in Bethlehem
Jagged to such an extent that the quo
cations receded almost 200 points. The
recent active trading in this stock,
stimulated by the reports of enormous
net earnings, has had the effect of
carrying forward the price to a point
somewhat in excess of last years
record, and this verified the predic-
Hons of many of its ardent admirers,
who have continually prophesied
Yelling price ten times its par value.
IN The recent announcement of the
British Chancellor of the Exchequer to
fhe effect that his government must
continue to spend $lO,000,00O day for
american products has been a fruitful
source of speculation for statisticians,
who have been trying to figure out
just where and in what proportion this
vast sum of money is to find final
deposit. Add to this statement the
act that the terms of new collateral
loan of $300,0O0,O00 to the British
government are about to be an
bounced. and an excellent confirma-
non of the probabilities of continued
var orders is surely provided.
~ Despite the general advance in the
stock market in recent weeks, Wall
Street leaders are confident that the
NShihSdl pOSltlOll VI lHC llldI hSl IS
Strong, and has been much improved
IS result of the sudden shake-up
hitch occurred coincident with the
B-boat activities on the Atlantic sea-
bard. The elimination of weak &C
cunts and the coincident resettlement
~ lower levels made for healthier
ambitions, and subsequent operations
ave shown that the undertone is
auch firmer in consequence. The
Moximity of election does not appear
~ have any marked influence in any
uarter, nor has it served to depress
aiding activity. Wall Street is look
Ug beyond election to the next step
81 international financing, interest
wing been rekindled this week by
ne resumption of gold imports in no
mall proportion The view is held