Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1920-09-03
GOSSIP OF
THE STREET

A number OF the EVENING LEDoEh
readers have written asking for a more
definite explanation Of the expression
Of the community of interest as ep-
piled in connection with recent article
on the railroad situation.
This expression sprung up about M
teen years ago, as the outcome OF tne
efforts Of such leading lights in the ran
road world as Hartman, Hill and Gas
satt, and others, to promote closer
CO operation of the railroad interests Oh
the country. The community OF in-
terest practically meant closer unln
cation, or amalgamation, OF railroa1f
management, with the consolidation OF
various lines or units into one system;
bringing the control OF movement OF
some particular commodity under the
complete domination of lines traverslng
that particular territory. This plan was
prompted not only for the reason OF
economy Of operation, but also I"
broaden transportation facilities.
while the scheme was only partly
carried out by these powerful super
railroad interests, the foundati0n'
nevertheless, was laid for closer ait
ance Of the various big systems. There
is little doubt had not the plans peem
handicapped by the Hepburn rate piii
and q multiplication Of antitrust ran
road legislation by the various state leg
islatures which, in the Roosevelt AZ :
ministration, became as proiihc as nlsS
on a molasses barrel, the country would
have been girdlcd by not more than
four transcontinental lines. MOST o,
the work accomplished by the. railroad
giants was upset and dented by the
anti trust legislation.
| Yet during the short government con
troll the wisdom Of the ideas, prompteo
In the community of interest ot ran,
| road management. was quickly foreseer
by the railroad administrator, and, a.
stated before in this column, much o
the ilegality Of railroad management
has been legalized by the Esch -Cum
minis bill.
Rail Enthusiasm Spreading
| After Yesterdays further successfu
upbidding Of the railroad stocks 1t wa
to be expected that little else should
spoken of other than what some o
those. enthusiastic about the outlook
called the prospects for a railroad boom
Probably it is only natural that Tn
railroad shares should be the mos
/ favored as the rails, II Is generail
conceded. have entered upon new er
by reason Of the rate increase, an0
since they have been selling at the low
l est levels in many years, 1t Is 10 .
expected substantial recovery shoul
occur. One OF the quantities in hg
uring the worth of specific railroad Sc
curities is the lack of data as to pre-
cisely how the net rate increase WI
effect the earning of any given road.
II In view of this uncertainty, the vie
of 8. Davies Warfeld. head Of the Ma
II At &c hnsp
road Securities. on the subject Is esp'
cially interesting.
III In his capacity as chairman Of d
| Seaboard Air Line Railway, Mr.. Wa
field says:
| "Since the operation of the act
relation to rates IL more or less aut'
matte, should the increase named n
yield the expected return under {
requirements called for by the act, I
commission will doubtless make Il
! necessary adjustment to meet those r
- quitements.'
Distribution Going On
It Is oftentimes refreshing and illun
= mating to hear what the other fellc
has to say. The growing bullish enth,
siasm in the rails is not by any mea
altogether q unanimous verdict. Qui
few are disposed to look upon t
demonstration With rather skeptic
" view. and regard 1t as n fash in
pan. which, however, may be prompt
because of the many false starts th
were made in getting the rails point
n upward.
n One of the doubling Thomases is ].
n Fayne, who occasionally sends over
N mighty interesting market letter to
n W. Sparks & Co. In commenting up
M Al,
said:
n evidence accumulates that in sp
! N of the splendid performance of the ra
In the midst of buhish sentiment so
selling has been going on.
NJ Otherwise, it Is difficult to expl'
" why during four point advance