The sun. [volume] (New York [N.Y.]) 1916-1920, 1918-09-25
BANKERS TALK ON
RAILWAY PROBLEMS
Francis II. Sisson Speaks on
the Wars Effect on Rail-
road Securities.
WAYS TO HANDLE LINES
Could Modify Old System Into
Regional Plan Under Pri-
vate Ownership.
Special DespatcA % TIE sus.

Special DsspatcA 20 TIE sus.
CHICAGO, Sept 24.-with every man
eager to do his utmost on Americas
fiscal firing line every financial prob
lem discussed At the sessions to-day OF
all divisions Of tho American Bankers
Association. whose forty-fourth annual
convention ran its second day with over
1000 militant members answering
present" underwent Just one test
what solution will best operate to crown
tho war with overwhelming victory at
the earliest moment 1t was "war.
War. War" all along this picket line.
which represents the force Of all Ameri-
cas- banks and trust companies.
Plans were evolved to aid in putting
over the impending fourth Liberty Loan
IN worlds record time. Cooperation and
coordination OF financial resources OF
the United States was proposed in al
tered systems and methods 20 that the
financing Of the world war for Uncle
Sam may be speeded up to the maxi
num- Conditions which must be dedlt
with after Prussian militarism has been
erased from the earth also were dealt
with.
Foremost Of these problems was the
future Of the great railroad arteries of
tho United States. And foremost in
discussing this vital question-what Of
the roads, their securities, their future.
their contract with the Government and
possible Government ownership after
the war-was Francis H. S!sson. vice.
president OF the Guaranty Trust Com
pary Of New York, before the savings
- ~ lat tar. Ia
spoke on Tho Eject Of the War on
Railroad Securities" and said in part:
= The questions of the moment in the
minds Of all. are: Will railroad securi-
ties rise or fall under these changed
conditions? Will Federal administration
Of the railroads improve or injure their
status as economic factors? VIII pri-
vate or public ownership follow the pres
ent anomalous situation? Can the pres
ent merger ever be ''unscrambled"? He
would indeed be a prophet who could
supply the answers; but one may at
least have the temerity to speculate on
these subjects and enjoy the diversion
Of discounting the future mentally, II not
narketwise, without criticism.
The Future Problems.
'rhe future value of railroad eecuri-
ties will not be determined, even during
the period Of Government operation. and
stu less In the period of transition from
Government back to private operation,
ny the compensation which the Govern
ment may pay the companies, nor by the
way in which It may maintain the prop
critics AS the prospect Of the return OF
the railways to their owners as the act
contemplates. becomes moro imminent.
the ratio between earnings and ex-
penses will become q moro and moro Inn
portant factor In determining the value
Of the securities .i-ss 4:'I" ,...--,'-. s
1T seems reasonably certain that az
Ger the contract has finally been executed
ny the roads, the railroad stocks will be
placed in about the same class as rail-
road bonds. since, with their earnings
definitely limited and guaranteed. specu-
lative possibilities win be largely elirni-
mated from them and their prices should
not greatly fiuctuate.
From the short term viewpoint that
Of tina period Of Government regulation,
the position OF the security holder Is
fairly definite He has assured for him
q definite guaranteed return and need
not be disturbed about the uncertain
lies that might arise during this period.
He has thus been greatly served by
Governmental Intervention.
Damages for Loss.
However. It is clear that Government
operation will undoubtedly make It very
difficult for some roads to have re-
turned to them the same kind of a rail-
road that they had before the Govern
;nent took over It's operation. Through
the rerouting of traffic and the common
rise OF terminals the business that GER
tain roads had developed will be affected.
md they have insisted upon their right
to recover damages for such losses In
order to protect the interests Of their
security holders
There are three ways in which the
railway system OF the country can be
handled at the end of Government OPP
Grafton. The first Ia the present plan
of returning the roads to their individual
companies: the second Is that providing
'or complete Government Ownership and
operation. while a third plan Is possible.
hat OF modifying the old system of in
c'Vdual companies into one OF regional
railways under private ownership. which
All insure all OF the advantages that
would come from coordination Of rail-
way facilities and the advantages that
would come from retaining private own
'Ship and private enterprise In the
Management OF the roads with Govern
Inent cooperation and guaranty. The
fecurity holder Is vitality interested In
al ui these possible solutions, and the
N;lre OF railway securities is dependent
lp-A lie course taken.
Great Compsnies' Part I'm War.
Speaking before the trust company
seton OF the Association on Trust Ser
wee and the War" Mr.. Slsson said in
part.
When the fiscal history of this great
81 O, all wars is written one of Its most
Illuminating and important chapters will
chronicle tho invaluable services rem
Tered by the trust companies OF the
'nited States. That record will AFFORD
+'ost convincing proof of the peculiar
"4GFability of the trust companies. as
wen as the unique and indispensable
~'ace they occupy In American finance
ana economies 1t will reveal In more
ttr.H'ng relief than ever before the great
auctions OF these institutions. their
round principles efficient management
ana far reaching services. That account
no. viii be one OF a high sense Of pat
lo,lc duty, Of unselhsh and unstinted
ana unceasing activity for our country.
our Allies and world democracy.
Flnanciers iund financial, institutions
tre performing as essential war work
rs are fighters, factories and shipyards
her part In tho splendidiv successful
+A''""'Y loans sufficiently attssts the
- city OF that claim But there are
'Dary other fields Of endeavor. less dra-
flIf1 fut mona tho lesa vital in which