Evening star., 1921-04-17
By I. A. FLEMING.

Railroad shares turned sharply
one day last week. under the stimu-
lus of the Labor Board in terminal
ing the national agreements of fed
eral operation. marking a treme ndous
change in conditions with regard to
the great transportation arteries Of
the nation.
The railroads Of the country have
been handicapped. in that their own
ers. men and women. corporations.
life insurance companies. savings
banks and trust companies. have
not been given any voice in their
management.
There is powerful organization
of these forces today, the investors
who hold the stock and bonds of
these various corporations operating
the transportation system. Year
after year these companies have been
going from bad to worse, under the
pressure for lower rates from ship
perS and the urge of higher wages
from the workers. brotherhoods. sat
isfied with wartime conditions. hut
slow to accept the return of peace.
which has prae,i ,ically been back more
than two years.
Between the two. security holders
were without redress and could keep
their certificates and bonds lock ii
up in strong boxes and note the daily
price receSSionS or accept the con-
cessions of s25 to $50 or more "A
share and taking their loss. shifting
the burden to other shoulders.
Dividends have been cut: earnings
have been eaten in overt ime and
excess charges Of various deScrip-
tons
For years the I. c. G. clipped the
earnings Of the roads. nibble by nib
LII
and the trials of the war, the rates
were advanced, as many think, too
sharply.
Government ownership. costly to
the people, but, as before stated.
satisfactory to workers. brought no
relief to shareholders
Now it is a case of the Sharehold-
ers, or their representatives. taking
hold and making their own arrange
ments with their workers as husi-
ness men. perhaps to the necessity of
few changes in brotherhood rules
larger return to the shareholder
eventually. when the changed con-
ditions shall be in operation. else
bankruptcy.
Commenting on this interesting
proposition. the Bache Review says:
There now enters into the field of
contest a body representing the really
most important part of the PROPOSE
tion-namely. the owners Of railroad
securities.
'"The contest at this time is not on
rates. but on settlement of the wage
dispute. The real owners are repre-
sented by the National Association of
Railroad Securities. Its membership
reflects the Interest of some 10000 600
owners. directly or Indirectly. This
large number includes the savings
bank depositors and the life insur-
ance policyholders, who are Indirect
ly affected because the insurance
companies and savings banks hold
enormous amounts of railroad securi-
ties. The savings banks hold around
81. 600. 100000 of railroad bonds. and
the insurance companies over ST.
900 100000.
"It is true that negotiations with
employees are strictly within the prov
ince of the management of the rail-
roads. but it is undoubtedly well for
that while there are 100000 en-
ployes. there are 100000 to 80.
900. 900 security owners who are suf-
fering from the abnormal situation
which has been created through
labor's absorption of 20 per cent of
resulted in the railroads being run
at a very heavy loss.
''The Pennsylvania Railroad Com
pany has asked its men to accept a
wage reduction, and gives three or
four compelling reasons. One of
Pennsylvania railroad $1.05 to take in
81. without considering taxes, inter-
est on debt. etc.
at stated that on the 2sth of March
s1.SS4 freight cars (35 per cent of all
those owned by the system) were idle
and were not earning a cent.
Further. that without providing for
any dividends whatsoever the Penn
sylvania railroad lost s1,60O710 in
December, &4.300.000 in January. S.
100000 in February and that March
figures would be as bad
"In the public mind the contest in
railroad wage disputes has been un-
derstood to affect only the public. the
railroad management and the wage
earners. The effect upon the public
II adverse. has been in the nature of
inconvenience and physical suffering
A new element for the wage earners
to cosider is the financial distress
caused to some 100000 security
owners"
The Public in Stocks.
What is the psychology of the pub
lie in its operations in the security
markets?
The pitcher may go to the well too
often, but in this instance it never
goes on any mission but to acquire
stock, the opportunities of profit on
the selling side never being given
consideration until too late to be of
any actual advantage
Securities have been ear-marked. as
they say in London. when they set
aside a box of gold for the United
States. for a decline for a year and
plainly. but the only sales by the
public are for the purpose Of getting
losses for tax reporting purposes and
getting back again, frequently, for
further losses.
When the market is going down
the public stays out; when it is going
up brokers. offiees are crowded and
The public will not sell short.
Ninety per cent of it's transactions
are on the long side of the market
Why will a buyer of securities,
aside from the bears and profess
sionals, take a profit Of few points
and hang on for dear life when the
market is being smashed day by day
for 40 to so points losses? Hang on
until the loss is SO heavy that the
trader heSitates to get out, in antici-
and probably side-tracked for months
to come.
Experience will not answer either
question, though it has observed the
phenomena and has been familiar
with it for fifty years.
Citfsens' Savings Bank.
On the 18th instant, the Citizens
Savings Bank celebrated its second
anniversary. a healthy, growing in
stitution, on the highway of pros
perity. Fernand Petit. cashier. re-
ported at the close of business on
Friday last s761, 900 deposits. a gain
of over $500.000 in the two years.
The total resources of the institution
are 81 ,047, ,S12.96.
Wa shinefon savings banks are all