May 18,1895





Record  and  Guide.





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VOL. LV.





MAY 18, 1895.





No. 1,418





For Brooklyn matter, see Brooklyn Department immediateli' follenving
Hew Jersey records {page 854).

IT looks as if the rise, wbich was almost continuous for ten
weeks, has taken the bloom off things in the Stoek Market
somewhat, and that hereaiter, while the market will in tbe end
tavor purchasers, it will be subject to reactions oi: more or less
severity, according to the circumstances that bring them about.
It would not be at all sui'prising if the one that began last Mon¬
day should continue still further. But we are in a time of
luliabilitations, and any movement that will put a bankrupt
property back into the solvent list, oi that even promises to per¬
form that beneficial work, will he the signal for a new advance,
with the securities most directly affected, of course, in the lead.
The .situation favors, too, new deals and combinations, and these,
as they are proposed or effected, will have a tendency to keep
prices from becoming utterly disorganized. The husiness situa¬
tion East is one of continued eucouragement, and is likely to
remain so for some time, because it will not be a very brief task
to replenish the supplies of the country which, it has been
admitted on all sides, were down to bare needs. The West still
hangs hack, recent climatic change having rather deepened its
trmihle, hut the people are not despairing, believing that there is
still time to remedy the damage done hy the cold winds.





A LONDON paper points out where G-reat Britain's war chest
is. With l^ranee, Grennany and Russia keeping their great
gold hoards so prominently in view, the question arose what
England would do for money in the event of hostilities with
another great power. The answer is that she eould pay the in¬
terest of a new loan of $1,000,000,000 without adding anything
to the burdens of the taxpayer by diverting to that purpose the
margin of taxation that now goes into the sinking fund forthe
redemption of the national debt. Tbis is a provision that none
of the other powers have. Reports of improvement in business
in European countries are a little more pronounced than they
were. This improvement is indicated in England by the de¬
mands of the provinces on London for money, which have
already strengthened discount rates, though fractionally only;
in Frauce the purchases of rentes through Treasury agents are
falling ott'; in Germany the iron outlook is brighter and the pros¬
pects of textile trades are tbe subject of favorable comment; at
Vienna the shares of banks and some iron works have risen in
price, the reason given locally being the improvement in busi¬
ness. A correspondent in Mexico says that that country is re¬
covering from the serious effects of the disastrous harvests of
1891 and 1892, and the dislocation of commerce due to the de¬
cline iu the value of silver, has gradually heen succeeded by an
adjustment of trade to the new conditions and the steady devel¬
opment of native industry. From Argentina the reports are not
good; in fact, an English paper published at Buenos Ayres says :
" Not since the crisis came five years ago have husiness mattere
ijeen so bad as they seem to-day." That was written a month
iigo, and meantime it should be noted there has beea an advance
in Argentine securities as a result of the attempts of the govern¬
ment to place them in a better position.





WE print elsewhere iu our columns a serviceable arrange¬
ment of the uew legal requirements necessitated by the
, ''eccnt enactment of the Tenement House Bill. It will he seen
at a glance that the present condition of the measure differs
greatly from the positive absurdity which was iutroduced into
the Legislature some months ago by Mr. Gilder and his ignorant
w-reformers. The dose of refoim which we actually have to
take is merely homeopathic. It is not likely to have any marked
eft'eet oue way or the other on: the body social. Indeed, we
vather suspect that Mr. Gilder  would have  abandoned the





measure long ago if he could have done so without at the same
time abandoning his reputation as an amateur reformer. All
that remaius now for our builders to do is to study np the few
additional requirements which the law demands and comply
with them.





Northern Pacific's Eeadjustment.

THERE is about Northern Pacific the usual gossip that pre¬
sages a change, or an attempted change, iu a great prop¬
erty whose securities are the subjects of speculative manipulation.
Most of this is mere buzzing, but it is nevertheless highly prob¬
able that a plan of reorganization for this property will he
announced in a reasonably though not very near future. Not
only the talk that is going on, but the fact that its earnings are
increasing gives color to this belief, because it is always desira¬
ble, if not necessary, to get capital readjustments effected on the
basis of earnings of bad times. The improving husiness outlook
and the actual gains showu by the Northern Pacific in its receut
weekly reports cf its earnings are likely to hasten the prepara¬
tion of the plan for this settlement, for the simple reason that
those having the matter in hand know very well that the security
holders will accept harder terms now than they will later on
when the returns are heavier and prospects brighter.

President Hill, of the Great Northern, and Mr. Villard are
both mentioned as likely to guide the course of reorganization.
In regard to the first, there are a good many reasons why an
alliance with the Great Northern would be a good thing, but it
is impossible to see how it could be eff'ected on terms that wonld
be satisfactory to tbe Northern Pacific junior security holders.
To take the property on any but bargain terms would weigh
down the Great Northern and imperil its fine credit, and Mr.
HiU is too shrewd a man to be suspected of contemplating an
operation of that kind. Given his own terms, there is no man
in tbe country who could operate Northern Pacihc to better ad¬
vantage, either to the property itself or to the capital that may
remain upon it, Mr. Vilhird's name has heen connected with the
prospective reorganization because of the recent buying of the
geueral 5e., -(.vhieh, from all appearances, are the issue which will
control in the final settlement. The reappearance of Mr. Villard
in control of the reorganized Northern Paciiic would be about
equal to a permanent discount of from ten to fifteen per cent.
from the securities of the property; that is to say, their value in
the market would be that much less than they would otherwise
he because of the discredit his management would give to them,
much as Mr. Gould's name was a bar to perfect confidence in the
securities of his roads. There is, however, good reason to be¬
lieve that Mr. Villard has money, and as things arrange them¬
selves there is nothing to prevent a man if he has money from
buying a wreck, even though he should have beeu the one to
cast it upon the rocks.

Whatever may be the plan and whoever the reorganizers may
be, the security holders may take it for granted that the basis-
will be purely an arithmetical one. One interest may offer more
on paper than another, but the actual cash results are likely to
be pleasantest in proportion to the business principles that enter
into the calculation, A reorganization for stock-jobbing pur¬
poses is to be desired the least of all. Of course the problem to
be solved is not an easy one, not so easy as the Atchison one,
nor, it may be remarked, so difficult of solution as the Union
Pacific matter has proved aud will prove. Ifc is unlikely that
any attempt will be made to take in the Wisconsin Central or
tbe Chicago & Northern Pacitic in the first instance, though it
is here that the Northern Pacific and Great Northern might very
well join hands, but there are a number of branch lines which
may hereafter be of great service to the parent system, whose
relations to it have to be readjusted; the terms of which read¬
justment will materially affect the value of the junior securities.
It is doubtful if any concessions can be obtained from the three
first mortgage issues, except, perhaps, the funding of arrears of
interest, because net earnings as currently reported are more
thau sufficient to pay full interest upon them. In fact, for the
first eight months of the present fiscal year they amounted to
$4,500,000, while interest on the First, Second and Third mort¬
gages for that period amounted to about $3,000,000, leaving
$1,500,000 for taxes and interest on the Collateral Trust Notes
and some other indispensable obligations. A continuation of
the improvement that has been seen in earnings for the last
month would soon show something earned ou the General 5s;
this fact had something, of course, to do with the advance
in the price of those bonda, but its more important
significance is in making them the pivot for the
operation of readjustment and thereby assuring to them reason¬
ably good treatment. The preferred and common stock occupy
different positions. The provision for a floating debt of between
$7,000,000 and $8,000,000-and other requirements will doubt¬
less fall upou them, and upon the common stock particularly.
The preferred stock has a claim upou the land grant east of the
Mississippi so long as default is not made upon the first mort¬
gage bonds,   The land in this grant was last i eported to amount