April 13, 188&





Record and Guide.





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Vol. XLIII.





APRIL 13, 1889.





No. 1,100





Secretary Windom's liberal purchasea of national bonds settle
the question that there is to be no extra session of Congress to vote
large appropriations for improvements, so that the surplus in the
treasury could be used productively to '.help the legitimate business
of the country. Ex-President Clevland's policy of making a
present of the ti'easury eui'plus to the wealthy bondholders and
corporations is to be continued, though fche motive in each case is
different. The retiring Presidenfc wished to force Congress to reduce
the tariff; the new President probably wants the next Congress to
revise the tariff wifch a view to increasing the revenues, and hence
be will not only do what he can to dispose of the present surplus
and reduce the debt, but wUI favor some more pension legisla¬
tion to further waste the funds of fche nation.





The situation is anything but reassuring. When Congress does
meet there will be no money for internal andharbor improvements,
for rehabilitating our merchant marine, or beginning the gigantic
work of defenses for our sea-coast cities. To raise new funds there
will be a proposed tariff revision, which will still fiu'ther unsettle
the business of the couutry ; but, while trade will suffer, Wall
sti-eet may have occasional good times, for bond-buying by the
government always starts speculation in the "sfcreet." We all
know what happened wben the government stopped purchasing its
own debt obligations in July, 1887—securities of all kiuds got a
"black eye." The fall of that year saw a reuewal of bond-buying
and a consequent revival of speculation, alfcliough the raih-oads of
fche country were in a deplorable condition in the spriug of 1888.
Secretary Fairchiid's circular of April of last year made a bull mar¬
ket. From July fco Ocfcober there was a steady advance in prices
due to bond purchases, although the railroad wars in the Wesfc
were bankrupting the wealthiest aud the most powerful railroad
corporations of the country, such as B. & Q,, Atchison, Rock Island
and Missouri Pacific. Secretary Windom's liberal purchases of
bonds has revived speculation in Wall streefc.





The highly respectable banking firm wbich represents the Barings
in this country have gained a deal of eclat lately by their endeavor
to bring about a change in the Atchison Company. But is there
not somebody to blame besides the directors of that great raili'oad
corporation. In something over three years the capital stock and
bonded debt was not only doubled but trebled. It found no diffi¬
culty in selling its stock, or marketing its bonds. The bulk of the
latter were placed through this very banking concern, wbich hasat
last discovered that the railroad was managed in a most reckless
manner. But ought uot the Barings or their American representa¬
tives have kuown all tbis in dealing wifch the officers of fche Atchison
Company. Their means of information were very mucli better tban
that of the general investing public, to whom the banking house
sold the bonds. It ought to have struck them that this sudden crea^
tion of an immense debt must have been perilous business for even
the most solvent corporation, but it seems they "were content to sell
the bonds aud pocket the commissions until tbe imprudence of the
company became manifest to the operators iu the stock market.
After the steed was stolen tbey came to the fronfc to lock the stable
door. Iq other words, after the investing iiublic got rid of their
money, the bankers announced that they proposed to change the
management of the Atchison Company aud asked the stockholders
to Ijelp them.





So far bankers have generally not dealt fairly with investors. All
they have seemed to care for has been their monstrous commis¬
sions. The great investing public was a goose to be plucked. The
leading banking houses of the world would cut a very sorry figure
were any oue to publish the loans they have floated on the market.
It would be found fchafc some of the most respectable houses have
raised money for the most hazardous and speculative enterprises
which were almost certain to come to grief. There is, however,
scaBcely any danger of exposure. These bankers are, or may be,
generous advertisers, and our newspaper press never quarrels with
fche supply of bread and butter,   The journals of "to-day would no





more open fire on the bankers than they would on the patent
medicine vendors, and for the same reason. Then, again, a news¬
paper that would be honest in the matter might be discredited by a
cry of blackmail, which is easily raised and hard to disprove.





Still we think this reckless lending of money to corporations on
its issue of bdnds has received a check. It is evident that the great
concerns, like Drexel, Morgan & Co., the Barings, etc., are supposed
to give some guaraniee to investors thatthe money will be safely
placed. People who buy bonds hereafter from great houses will
have a befcfcer show for their money than they have had in the past.
It is very evident tbat the Western situation is in much better
shape than it would have been had there not been some co-opera¬
tion among the bankers to secure better management for the
future. It will be remembered that at the original meeting of
the railroad presidents at Mr, Morgan's house, in this city, last
December, Mr. Roberts, of the Pennsylvania Central, very frankly
told Mr. Morgan that the bankers were greatly fco blame for placing
loans which pracfcicaliy encouraged reckless overbuilding. This
fche greafc banker did not deny, and he promised that in the future
more cai-e would be exercised in this matter.





There are signs that the public mind is assuming a saner attitude
towards the Mauhattau Company in relation to the rapid transit
problem. We publish elsewhere iu this issue a third series of inter¬
views with prominent citizens as to the advisability of grantino- the
elevated roads permission to construct a third track for express
trains and a " loop " in the Battery Park. These interviews in The
Record and Cdide have clearly demonstrated thatthe press of the
city does not truthfully represent public sentiment by ifca attitude of
uncompromising hostility to fche Manhattan Company. Prejudice
is no guide to the solution of the problem which confronts the city,
and people are beginning to see fchat the urgent demands of the
houi" can best be met, indeed can be mefc only, by improving the
system already iu existence. The public are also learning that the
rapid transit necessities of the island, for the present and the future,
cannot be provided for by any one scheme. There is room nofc only
for whatever Mayor Grant's bill may bring forth, bufc for the Arcade
road and the cable system. This saner view of the matter is even
being taken iu Albany. Mayor Grant's measure apparenfcly wiU be
passed without any hampering amendments. Mr. Hamilton, who
is the advocate of the cable system, said in a speech on Wednesday:
"I am generally opposed fco our giving up any portionof our parka;
but in this case I think a portion of the Battery Park might be
given to the elevated road for its use, without material harm to the
city's interests;" and Mr. Crosby, who introduced Mayor Grant's
bill, promised to suijport a measure granting the Manhattan Com¬
pany fche facilities they need. These are indications that at
last common sense is to play some parfc in the rapid fcransit question.





The Manhattan Company does not seem to know how to deal
with fche press. It made a curious and characteristic blunder last
week. Noticing that the publication of the Battery Park loop map
in The Record and Guide made a favorable impression on the
public, its officers hired some scribs further to elaborate Che loop
project with diagrams, description and the like. As the Sun news¬
paper had net shown the rank prejudice against tbe Manhattan
Company that the other papers did, the article was gotten up as if
written by a reporter of the Sun. The Manhattan officials having
fche matter in charge supposed there would he no difficulty in pub¬
lishing it in fche Sun as news matter, but that journal makes it a
rule—as indeed do all first-class newspapers—fco publish no paid-for
matter without explaining to its readers that it is an advertise¬
ment. The article was accepted, but fco the mortification of the
Manhattan people the letters " Avt." at its close toid the story of its
origin and purpose. The Times publishes such articles for pay
without notifying its readers. It will abuse Jay Gould without
stinfc ; but has frequently published interviews with him, for which

he paid cash down.

----------■----------

But the interviews we have been publishing for the past three
weeks show that our press does not represent iu this case tho mass
of our fellow citizens. We have given fche unbiased opinious of
representative bank presidents, real estate owners and dealers,
bmlders, architects and merchants in all departments of trade.
Among them we have found no echo of fche active dislike to the
Manhattan Company shown by the Times, Herald, World, Evening
Post and other daily and weekly publications. The Record and
Guide cau safely claim to be the first and only journal to point out
the fact thafc if we are lo have auy immediate relief in the way of
rapid transit the Manhattan Elevated is the only railroad fchat can
give it to us. We have been pointing out for the pasfc two years
that an additional track on the 3d and 9th avenue roads would
save at least twenty minutes time between both ends of the island,
and enable the company to carry one-third more passengers. We
have also urged the widening of Elm street to accommodate ancther
elevated road, as well as the construction of another branch on the