Record and Guide





237







Busntess jublHEitEs or CeHb^ iKnnpl.

PRICK     PER   TEAR     IN   ADVANCE    SIX   DOLLARS

PwbHshed every Saturday,
Tblbfhone,                                        Cobtiakdt 1370.

Common Icadona sliatild ba addreiaed to

C. W. BWEBT, 14-16 Veaey Street.

J. 1. LINBSBT, Bu$ines8 Manager.

"Entered, at tht Foat-OSice al New York, K. Y., assecondrclass matter."





Vol. LXIII.





FEBRUARY 11, 1899.





No. 1,613





'HERE is a shrinking of business and an irregularity in,
** prices on the stock market which shows that the public
deEires to hold off to see what the outcome and influence of recent
events will be. The position of affairs in the Philippines is seri¬
ous enough to justify this to a people that did not, and does not,
want to mow down semi-nude barbarians with machine guns,
but only to bring them peace, plenty and freedom from oppres¬
sion. It is too bad to find, according to scare-head Elnglish, that
their proteges have become "rebels," The financial condition of
the Government is also again becoming as prominent as it was in
the latter part of President Cleveland's administration, through
remarks recently made in Congress, It should be borne in mind,
however, that the case is very different now from what it was
then. There is no question of the ability of the Government to
maintain gold payments now as there was then, and
there had been then no distinct decision of the country
to abide by the gold standard, as there has been now.
It would be infinitely better, of course, if the Govern¬
ment's fiscal arrangements made a balance between income
and expenditures more nearly possible than has been the case
for some years; but while the adjustment of differences is dis¬
turbing, the issue of a few hundred millions of dollars in bonds
more or less can make very little difference to a country as large,
rich and as lightly involved as this. Therefore, if it is finally de¬
cided to issue bonds, that fact ought not to disturb business. It
will be remembered that the last issue was positively inspiriting
and that the Cleveland issues, notwithstanding the gloomy times
in which they appeared, actually served to make business better,
for a time at least.





IN spite of tbe reductions in the bank rates the conditions of
the money markets of Europe have only to become some¬
thing more than ordinary and nervousness Immediatey arises
as to the ability of operators to obtain funds readily. This
was the case only this week when the settlements were being
made in London and Paris. The continuation of the high price
for gold also shows that there is still more than a usual demand
tn the market for that metal. The market is iri expectation of
an announcement from Portugal regarding Delagoa Bay, the idea
being that although the King is bound by his promisenot to alien¬
ate any Portuguese territory, a lease of the bay would be no viola¬
tion of that promise—especially if the terms are pecuniarily sat¬
isfactory to Portugal. London has shown a better disposition
toward government loans than has been observed for some years
past, the reported success in advance of the proposed Chinese
and German offers being evidence of this fact. This is due to
the growth of capital during half a dozen years of successful com¬
merce and manufacture. In France the success of the Indo-
China railway loan has encouraged the Government to prepare
schemes for railway construction in other of the French pos¬
sessions. The Minister for the Colonies bas stated that the Gov¬
ernment was taking measures to open up trade in the colonial
domain by railways. According to "Der Deutsche Oekonomlst,"
the new issues of capital In Germany in 189S amounted, taken at
the. issue price, to $570,000,000. There has been a constant In¬
crease in issues since 1895, when they amounted to $340,000,000,
followed in 1896 by ?470,000,000, and in 1897 by $490,000,000. The
feStatiUshm^nt. ot joint-stock companies was the greatest. In point
of capital, since 1873. The "Oekonomlst" places the capital of
these new companies at $115,000,000. against $95,000,000 In 1897,
The Austrian Board of Trade minister has had an inquiry made
as"to the advisability of destroying the iron ring, represented by
the Prague Iron Industry Company, about whose affairs so much
sensation was aroused a few months ago. It was stated among
other things that iron manufacturers in Germany refused to
take Austrian orders because of agreements they had with the
Prague Company. Altogether It looks as It a report in favor of
^bolIsJUPS some of the protective duties on manufactyre^ iron





will finally be made. The decline in the gold premium at Buenos
Ayres noted last week as a consequence of the favorable reportft
from the Argentine harvest fields has not continued this week,
but on tbe contrary there has been a rise, from which it may be
taken that later crop reports are not as good as earlier ones
were, Publie comments point to Macedonia as being likely to
give cause for a break in the terms of European peace. The peo¬
ple there suffering under Turkish rule have almost as good as
declared their intention of compelling other nations to intervene
in their behalf by drawing down massacre upon a part of them¬
selves. That, they argue, was successful in Crete, and it would
be better to sacrifice a part of their people if it brought relief to
the others than to remain in the cruel bondage of the Pashas.





WHAT CONSTITUTES EQUALITY IN TAXATION?

THE charter, in conformity with State law, provides that real
property shall be assessed for the purpose of taxation at
"the sum for which the said property under ordinary circum¬
stances will sell," Of course, in practice, th© assessed valuation
is always, except in rare and unintentional cases, less than the
market value—a practice which owes its origin to the general
desire on the part of each tax unit of the State to pay a smaller
share of the State tax than the others. Nevertheless, in each
tax unit the assessed valuation bears some more or less uniform
relation to the market value. The assessed valuation of a piece
of property is affixed to the tax roll by the assessor only after he
has first determined in his own mind the selling value. Roughly
speaking, therefore, the selling value furnishes the basis for
taxation.

Now, the sum at which a particular piece of real estate will
sell is a matter which-is subject to thS widest difference of
opinion, even in neighborhoods where sales are of frequent oc¬
currence. In the absence of recent sales the difficulty of secur¬
ing a Just appraisement in a given locality Is enhanced. As re¬
gards such localities assessors estimate the probable increment
in realty values from the sums expended in recent building im¬
provements. It so happens, however, that it is precisely In those
localities where the construction of new buildings is largest that
rents tend the most, for the time being, to a minimum. Over¬
building leads to reduction of rents, although the price of
property advances, or, at least, does not retrograde. In anticipa¬
tion of a readjustment of the supply cf and demand for the class
of housing affected. The New Mercantile District is an excellent
illustration of the tendency of the selling price to have regard
to prospective r,ather than present earning capacity. But it Is
certainly not the intention of the law to tax future earnings;
such a tax would be open to other objections besides inequality.
In Mercer, Greene and Wooster, including side streets, many
millions of dollars have been expended in new buildings in re¬
cent years. At the same time, rents have decreased absolutely
and perhaps relatively, trade having to some extent left the dis¬
trict for reconstructed Broadway. Nevertheless, the tas assess¬
ments for 1899 have been augmented here as well as in sections
of the city where the earning power of iniiproved realty Is on tha
increase.   What is the result?

The owners of certain properties have called the attention ot
the Record and Guide to the hardships which the increased as¬
sessment compels them to bear. Take, for example, an old 5-
story building in Wooster street, where rents have declined, say,
33^ per cent, since 1893, and where the To Let sign is discour-
agingly conspicuous. This building is now fully rented for the
first time in six years. Sis years ago it brought $15,400 per an¬
num. It now brings $9,935. Last year the assessment on this
building was $85,000, which, with a rate of 2.01, made the tax
$1,708, or 19 per cent, of the net rents received. This year the
assessment has been Increased to $115,000, which, with a 2.50
rate, will make the tax $2,875, or over 32 per cent, of the rents.
If the rate shall prove to be 3 per cent, as anticipated by some,
the tax will exceed 38 per cent, of the net earnings of the prop¬
erty. In the case of certain premises on Crosby street the as¬
sessment has been raised from $12,000 to $16,000. The premises,
when fully rented, bring $600 a year. This year, after the taxes,
insurance and cost of repairs have been paid, the owner will be
out of pocket about $100.

That it is not old buildings only which are so overburdened Is
evident from the income and expenditure account of a modern
structure in'Greene street. " The gross rents for 1893, 1894 and
1S95, when the building was fully occupied, averaged $24,600
per year. The depression In rents and the decrease in the
tenantry of the locality has been so great that the owner has
found it impossible to obtain more than $11,300 this year, a large
part of the premises remaining empty. The expenses for ele¬
vator service, steam heat, insurance, etc., amount to $2,450, leav¬
ing $8,850 as net rent from which to pay the taxes. In 1898 the
tax on this property, which was assessed at $150,000, was $3,1)15,
or about 35 per cent- of Its present income.   For 1899 the aesese-