Jnly 29, 1899.
RECORD AND GUIDE.
.^^^
Bt;sD^3juù>lia<EsorCE>âs^1rfiatFsi^
PSICE PER YEAR IN ADVANCE SIX DOLLARS.'
Piiblinhcd every Saturday.
TELBrlIONE, CORTLANUT 1370.
CoramunioatioT^ should be adâressed to
C. W. SWEET, 14-36 Vesey Street,
â– 1. 1. LTNDSEY, Bushiiiss Maintf/er.
"Enieriid al Iht FoBi-Op%ce al New SorK, A'. T., assicond-class inalter."
Vol. LXIV.
JULT 20, 1899.
No. 1,637.
The Index to Volume LJI[I of the Becord aiid Guide, core?--
ing tlie period hetween Jainiary lst and June '.\Oth, 1899, is now
â– ready for delivery. Frice, iffl. This Index in Us enlarged form
is now recofjiUised as iiidlspensahle to every one engaged or
interested in real estate and- building opérations. It eovers all
transactions—deeds, nwrigages, leases, auction sales, building
plans filed, etc. Orders far tlio Index should be sent at once
1.0 the office of publication, 14 and IG Yesey Street.
ESPITE Lhe dullness in Wall Street security prices main-
taiu their strength. To enunierate the causes productive
oT this condition of things is to , repeat what has been
sàici several times before about tlie excellence of the
gênerai commercial situation and the indisposition of hold¬
en; to part "with their securities. Any activity in buying dis¬
closes a scareity of stocks. This is perfectiy natural because
it is not in times of confidence and prosperity that people throw
their holdings on the market, but when tlie conditions are ex-
actly the reverse. It îs by O'verlooking this fact tkat those who
remain bears on the market maîce their mistake. Prices may be
too high for a good many issues, hut so long as the owners of the
latter refuse to acknowledge this fact they will remain high, The
stubhorn résistance to attacks on quotations which has character¬
ized our market for a month îs merely a répétition of the move¬
ments of European markets when the prosperity of the commun-
itiea they reflected was in the stage that ours is in now. The pre¬
llminary railroad earning statements for the fiscal year, which
with very few exceptions ends on June SOth, which are now be¬
ginning to appear, are decidedly encouraging, showing as they
do a satisfactory increase in profits on stock. Where thèse state¬
ments are supplemented by equally good current statements, in¬
dicating a continuanee of profitable opérations into the new fiscal
year, stockholders are naturaily encouragea to believe that prés¬
ent quotations do not represent possible values in a reasonably
near future.
ALTHOUGH the mind more given to humorous than other
views pictures the results of the Peace Conférence as Will¬
iam T. Stead, standing in a débris of rejected resolutions shout-
ing "Victory; Praised be the Czar," there are others who believe,
while admitting a woeful lack of actual practical results, tha't good
will come of it. Some important questions hâve been ventilateû
and the difiiculties in the way of achieving the great object in
view hâve been exposed; moreover, a way has been found in the
proposed conventions to keep the discussion altve. Thèse com¬
bined make one of those slow but sure steps towards universal
progress that are more to be desired than more flaunting, hut
ephemeral results. The conférence has undoubtely heiped to
improve the world's political situation. Regarding the European
financial situation, the press continues to dévote a great deal of
attention to money. There is practical unanimity that rates
wili be higher and tbat some stringency will prevail when the
iarvest and holiday demands become pronounced. Thèse condi¬
tions may continue, with more or less severity, until the opening
of the new year. In London, the holding of the Bank of England
rate at 3^2%. notwithstanding the development of easier condi¬
tions at the moment, is approved as a measure of précaution to
strengthen the Bank against possible future rather than actual
présent demands. The condition of the Reichsbank indicates
greater tension at Berlin than was experienced this time Iast
year. A rise in the rates for public loans continues to be a marked
phenomenon of the situation In Germany. Nuremburg, which is
said to be one of the best communities in the Empire from the in¬
vestor's point of View, had recently to pay nearly 4% for a loan
and in ail municipal loans, of which a great number hâve recently
been placed upon the market for the purpose of raisiug funds
for electric railways and iighting plants, the same phenomenon
of the rising interest rate has heen observed. It is announced that
the délégations who are to arrange the common budget of Aus-
tria-Hungary will meet at Budapest in October. Some daim that
necessary adjournments will delay assembly until Decemher. The
removal of-the obstacles to the Ausgleich has called attention to
the question of eurrency reform, begun some years ago, but held
in obeyance owing to the uncertainty of the outcome cf the more
important matter. The Hungarian Finance Minister, when asked
when the Austro-Hungarian bank would return to cash payments,
gave an evasive answer, stating that the coining of the gold and
the printing of the new notes would take a long time, perhaps
three years, and, as there was no knowing how tbe economical
arrangements of Austria and Hungary might by that time bave
developed, it was not safe to make any binding engagements, The
gênerai political aud financial situation is favorahly interpreted
on the Vienna bourse. The Rand gold production for June was
445,793 ozs., an increase of S30 ozs. over that of May The pro¬
duction for the half year and for the corresponding periods of the
three immediately preceding years were: 1S99, 2,585 565 ozs â– 189S
1,961,663 ozs; 1897, 1,388,431 ozs.; 1896, 1,054,503 ozs.
THE KEALTY MARKET.
-J EiE number of plans flled for elevator apartments is evi¬
dently increasing întensively, as- well as extensively In
other words, the spéculative construction of elevator flats is being
cnccuraged by cheap money in addition to cheaper appliances
of opération. An excellent proof of the ahundance of capital
available for projections involving heavy outlay is the growing
proportion of apartment hôtels in the weekly reports of plans
filed. Time was when it was difficult to secure loans for this
style of residential housing, for the reason that the économie suc¬
cess of an apartment hotei dépends so very largeiy upon the
capability of one individual. It requires a mueh higher order of
executive ability to build and provide for the equipment and or¬
ganizatlon of a family hotel than to build and secure tenants for
a flat house.
The existence of a plentiful supply of capital available for build¬
ing opérations being couceded ta be an active force in the real
estate market, the question arises as to how far thîs is a condition
which ÎS likely to endure. Indications point to- a more or less
permanently higher interest rate on money employed in com¬
merce and the manufacturing and transportational industries
The expansion of capital needed to conduct gênerai business dur¬
ing the autumn months will, no doubt, tend to restrict temporar¬
ily the funds available for building operation-hardly however
to a sufficient exteot to influence the interest rate on real estate
loans, particularly as loans of this character are for a compara¬
tively long period. Furthermore, the money required for the
building opérations that are to begin in the fail wilî for the most
part bave been secured months in advance.
The continuous fall in the interest rate 'on real estate mort-
gages, which has been so couspicuous a feature of the money
market fo-r the past few years, bas been occasioned to a large ex¬
tent by shrinkage in the value of the asset. Money was loaned
at, say, 5% during the Iast period of prosperity; that is before
the panic of 1S93, when real estate values were much inflated
Smce then the process of weeding out financially weak owners of
realty has been in constant opération by means of foreclosure
suits. It is estimated that, in about 85 per cent, of the properties
loreclosed, the plaintiffs hâve been compelled to protect their in¬
vestments by purchase of the fee, the purchase invariably re¬
cording a lower valuation than that upon which the loans were
madé. This process of eliminating inflated values has now prac¬
tically come to an end, and prices are once more on a basis of
intrinsic merit. Meantime, the interest rate has declined in sym-
pathy with the décline in prices. With the continuanee of gênerai
prosperity, the process is likely to be—first, an increase in the
mtrinsie value of real estate, then spéculative inflation of prices,
followed by a stiffening of iuterest rates corresponding to the
degree of instability infused into the market value of the asset
As yet, however, the activity slowiy returning to real estate
has not developed sufficiently, broadly speaking, to influence
prices. Loans on real estate, unlike loans on stocks and bonds,
continue to be made on stable values. There is nothing in the
existing condition of the real estate market to indicate in the
immédiate future a stiffening of rates on mortgage ïoans similar
to that which is noticeable in commerce and the industries. Fur¬
thermore, when the expected boom in realty does come, the
average interest rates will hardly rise to the average of the last
boom, for in an economically progressive community the perma¬
nent tendency of capital interest is downward, though not in a
straight line.