November 5, 1S98





Record and Guide





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Vol. LXII.





NOVEMBER 5, 1898.





1,599





THERE must tie confidence in the minds of the men who con¬
trol our railroads, that they can obtain relief from Con¬
gress froin the unpleasant situation created l)y the recent Joint
Traffic decision. Otherwise it would be impossible to account
for the strength of railroad securities since the Supreme Coui-t
held that the Joint TrafBc agreement was illegal. Those who
remember the discussion that preceded the passage of the Inter-
State Commerce law, which was presumed to sanction rate agree¬
ments, will recall the fact that its necessity was insisted upon,
because rates were disorganized and railroad properties were
threatened with disaster as a consequence. By the passage of
the act it was thought that equitable ari'angements could be
made that would satisfy the railroads and be just to shippers.
That has not been the case, however. The railroads have not
held to their agreements, because the law was weak in that it
afforded no means for enforcing them. Rates were cut and dis¬
aster finally overtoofe: the railroad world so Ihat at one time the
mileage operated by receivers was appallingly large. Whatever
good it may have done in other directions, and it may be sup¬
posed to have done some, the Inter-State Commerce Act has to¬
tally failed to benefit railroad investments, so that the investing
public have a right to ask Congress to give tliem some assistance,
especially in view of the sacrifices made by them in the past five
years. What form this assistance should take has not been sug¬
gested, but it ought certainly be such as will allow agreements
on rates to be made, and also provide that when once made they
shall be maintained. The shipper's interest in this matter will
have to be protected, which can be done by creating a commis¬
sion to whom he can appeal for readjustments of rates when such
operate to his disadvantage, and who will have the power to en¬
force their orders. A year ago it was thought likely that Con¬
gress would pass a railroad pooling bill as a result of the Trans-
Missouri decision, but it did not. Evidently there is a stronger
ground for hope of relief now, otherwise it would be natural to
suppose that a break in prices of railroad securities, similar to
that that immediately followed the Trans-Missouri decision,
would have occurred on the announcement of the later and more
important ruling against agreements. As it is, prices are not
only strong, but there are signs of extensive new buying of rail¬
road bonds, in spite of quotations that at one time, especially in
the cases of the new bonds, would have been thought much too
high.





'^WO years of industrial activity in Great Britain, with a con-
A. sequent and continuous increase in the demand for money,
have brought about a substantial reduction in the prices of the
very best securities. Consols have in this time declined sis
points and guaranteed Canadian and Indian loans nine points.
Prices of other gilt-edged issues show corresponding declines,
and the end of this movement has probably not been reached be¬
cause there is no sign that lower prices are attracting new buy¬
ing. Certainly, with military and naval preparations now di¬
rected against Russia instead of France, if not against Rus¬
sia and France combined, there is little likelihood of
a change in sentiment toward these issues. That there is
no doubt of the industrial activity previously mentioned is shown
by the report of the Labor Department of the Board of Trade for
September, which states that, in 117 trade unions making returns,
with an aggregate membership of 467,075, 12,027, or 2.6%, were re¬
ported as unemployed at the end of the month, as compared with
2.8% at the end of August and 4.4% of 113 unions, with an aggre¬
gate membership of 462,292, reporting In September, 1897. While
we have no similar returns from labor in other countries. In
view of the reports that have been current for the past year or
two, the same cause, trade demand, supplemented in Bome cases
by over-Bpeculatlon, \b operating to create stringency In money





and to restrict operations on the bourses. It is the fall demands
that are the severest, so that putting aside extraordinary agen¬
cies In the Inflation of rates such as war, relief ought soon to
appear; otherwise accepted theories of the sufficiency of available
money to sustain a growth of trade that has been unprecedented
will be very thoroughly tested. In a period of over a quarter
of a century, in which wars have been of short duration and
carried on in very restricted fields; in which new markets have
been opened up, and resources, quite revolutionary in character,
as, for instance, electricity, have been extensively developed,
trade has grown so enormously tbat, failing tbe uprising of some
unnatural check to that growth, a situation of intense interest
will arise. In a year the aggregate gold holdings of the great
European national banks have decreased by about $100,000,000 (a
sum, by tbe way, that corresponds somewhat to the gold gains
by importations of the United States in the same period). As
these banks are the channels through which flows the gold pro¬
duction of the worJd, outside of that of the United States, and
which ought to replace the gold drawn away on exchange, this
loss reveals a very large dispersion of basic funds among de¬
pendencies in the provincial districts. The readiness and extent
of the return tide ought to indicate whether the present strin¬
gency is simply an aggravation of an old symptom or a new one
whose precise nature has yet to be diagnosed. On the solution
of this question will depend whether European Industrial devel¬
opment can continue. The situation in the United States is very
different, as we show in another column.





THE adoption of a budget for 1899 cf $93,520,082 must make
the propertyowner desirous of knowingwhere the money is to
come from. The amount to be raised by taxation will be reduced
to an extent, estimated at $7,000,000, by returns from the general
fund, but this still leaves $86,500,000, roundly, to be provided
directly out of the ratepayers' pockets. This is about $14,000,000
more than the budget of the current year, after deducting the
income from the general lund. It is stated, and we fear with only
too much truth, that the whole of this increase will be put upon
realty in Manhattan and the Bronx. Going into details, report
has it that the real estate valuations of these two boroughs are
being increased in the total between $500,000,000 and $600,000,000,
mostly by raising the assessments on the commercial and better
class of residential properties, especially in the middle sections
of Manhattan, from twenty to forty per cent. The tenement sec¬
tions on the extreme East and West sides are not touched.
Ordinarily such reports as these would not be worth repeating,
but at the moment they have credit and importance because it
is impossible to imagine where the increase in the city's pecu¬
niary needs is to come from, unless it be from real estate in the
old city. That this is so is not surprising; it is one of the results
aimed at by consolidation, and which the provision in the charter
requiring an equalization of valuations throughout the consoli¬
dated city was intended to produce. It is expected that the per¬
sonal assessments will be increased in Kings and Queens, as they
were in Manhattan and the Bronx last year, but that will not off¬
set the results of equalization against the boroughs or the in¬
crease in the cost of running the larger city. The final result
must be to increase the burdens in Manhattan and the Bronx
and correspondingly relieve the other boroughs.





X PPLICATIONS for paving streets and avenues are now met
*^ by the city authorities with the statement that this year's
appropriation for such work is exhausted, and such applications
can only he placed upon the list for consideration when next
year's appropriation becomes available. This is not a pleasant
prospect for owners of property abutting on streets needing re¬
pair, but it is one that will have to be borne with such philosophy
as has been vouchsafed to them. The fact of the exhaustion of
this appropriation probably accounts for the suspension of work
on Elm street, which has occurred in spite of the protests of the
owners of land and buildings along the route and of other repre¬
sentations made to the authorities. In our report of the Munici¬
pal Assembly will be found the announcement of the postpone¬
ment of other paving work in different parts of the city for the
same reason.





THERE are indications that red brick is returning to favor.
Except that fashion is as arbitrary and extreme in archi¬
tecture as In millinery,there never was any reason why the archi¬
tects and builders of New York City should have so completely
banished this warm-iooking material from the exteriors of their
work as they have for ten years past. They deprived themselves
thereby of a valuable resource for contrast and color, and the
general appearance of the city has suffered. Light bricks were a
valuable addition to the architect's palette, but much of the gain
was lOBt when one form of monotony waa substituted for anoth4r.