Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1920-05-11
ROADS EXAGCERATE'
NEE0S,.IS CHARGE.
Purpose Is to Enlist Greater
Measure ot-Public Sympathy,
Says Banker

An investment banker III this city is
of the opinion that the yailroads are ex-
aggerating their condition and their
needs to enlist a greater measure of
public sympathy and support from a
moral standpoint. He maintains that
good deal Of this exaggeration is pub
lished in regard to the car shortage
situation, which he claims is not any
where near so acute as the public Is
led to believe. Then he said the refund
ing necessary for two years TO come
will not be more than between $500,
100000 and 5000 900 ,O0o' 9.
Even IL the roads should be compelled
to pay an additional | or . per cent for
such loan, he said. the amount repre-
sented would be a drop in the bucket
compared with the earnings.
There was some talk in bond houses
of an issue of bonds or notes by the
Union Pacific Railroad Co.. but lead :
ing houses, which make railroad securi-
ties their speciality, denied any knowl.
edge of such an issue, although some
said one was expected.
A partner of one of these concerns
said that If such financing were to take
place 1t would certainly originate with
Kuhn, Loeb & Co. New York. but up
to the present his house. he said, had
not even been approached on the sub
ject.
Notwithstanding all this. there were
positive statements made by the repre
sentatives of some bond concerns tha,
Union Pacific issue was being sold
here, and one large financial institu
| tion was mentioned as having said il
had made its purchase a week ago.
| ~ Conservative brokerage houses are
advising their customers that the rail.
road list presents the safest venture al
present.
| One broker said that he is Of tina
| opinion, but would qualify it by q res
ervation as to that unknown quantity
| the valuation which the Interstate Com
meyce Commission will place on tn
roads.
At the present time. he said. the tota
of railroad securities at present marke
| prices is around $4,000. 900, 900. bu
] anyone who has given the subject even
cursory study will acknowledge the re
placement value of the roads and equip
ment, terminals, etc, Is little, IL any
short of $40 ,000. .000, 600. and the gen
eral impression is that the commission
will in all probability consider $50,
900 900 900 as a fair basis on which I
grant rate increases.
If this figure or a greater sum is de
cided upon, he said, then he woul
strongly recommend ailroad securitie
as a safe and profitable investment prop
osition.
The senior partner of we'll know
banking and brokerage house said tina
he had recently received some letter
which indicated that the word broker
as used by the newspapers is mis-
leading.
When broker or brokers are men
toned. he said, people conclude that
stock broker is meant and all the sin
and profiteering by sugar brokers, c
potato brokers, or any other species {
broker. is placed TO the account of th
stock broker, who hasstroubles enoug
Of his own without bearing the obloqu
Of all the others.
He said he hoped the newspapers !
these times of war on prohteerin
would distinguish between brokers, es
pecially between the stock and the suga
brokers'.
The manager Of the local Office of
prominent New York banking and in
vestment house when asked il he had an
information of new financing being don
| by the Union Pacific said he had jus
had his New York house on the phon
| trying to get information along th
same lines, and the reply he receive
wds that everything said on the subieC
| in the street was pure guesswork. Whe
| il comes, he said, it will be for euuip
, ments, but no one has anything author
itative about it yet.
Asked if he agreed with anothe
banker who earlier in the day had ey
pressed himself as of the opinion tbs
the railroads were exaggerating the
condition, especially as regards eouip
mentS to impress the public, he sale
that the condition of the roads was Ia
well known for any one to entertai
such an idea. ~,
| 1T is too serious a matter" he sale
The whole country is suffering fro,
the shortage of equipment to NOV
freight to markets. and enormor
quantities are being ruined by moo
storage accommodation in the absenr
| cars to move the stuff to the markets.
1T is also well known, be said, tha
| experts have gone, into the situate
! thoroughly and have decided that 100
600 freight. 5000 passenger, 1000 bag
gage cars and 2000 locomotives AZ
needed at once. It'is no pleasure fo
the officials Of the roads to be com
PEELED to pay s or per cent for m
money needed to supply these eouin
meuts, and if they could get out of
they certainly would.
In fact, there are several instance
where certain roads needing equipmer
badly could not raise the neceSssr
funds in any form unless they receiy
assistance from the government.
As an aftermath of luncheon give
by John II. Mason. president of Nh
Commercial Trust Co. before he ssile
for Europe. when leading bankers an
exporters of the city met TO discuss M
establishment of foreign bank unde
the provisions of the Edge law, il wa
stated yesterday that the First Federf
Banking Association, now being forme
under the co operative auspices of
strong group of banks and manufsc
turers in this caintry, had selectc
Arthur II. Titus. vice president of tb
National City Bank of New York. a
president.
. There was n limited amount bf tn
Ts al e -. Al 4