RECORD  AND  GUIDE.





177







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BusrtJE.ss A^/DThemes OF GeKeraI Intefiesi.

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C. W. SWEET, 14-16 Vesey Street.

/. T. LINDSEY, Business Manager.

"Entered at the Poat-Office at New York, N. T., aa second-clasa matter."





Vol. LXVII.





FEBRUARY 2, 1901.





No. 1716.





The Index to Volume LXVI of the Record and Guide, covering Ihe
period between July ist and December 31st, igoo, is now
ready for delivery. Price, $1, This Index in its enlarged form
is now recognized as indispensable to every one engaged or interested
in real estate and building operations. It covers alt transactions—
deeds, mortgages, leases, auction sales, building plans Hied, etc. Or-
ders for the Index should be sent at once to the oMce of publication,
14 and 16 Vesey Street.

T COKING under the reports of deals and combinations that
■^- are given as the reason for the continued strength of
the Stock Market, It will be found that the real cause is the
great volume of the capital that has at present no other use.
In what other way can the every-day demand for investments
lie satisfied? Government bonds are practically pre-empted
by banks of issue and trusts; municipal bonds are also to
a great extent absorbed by fiduciary agencies. What then can
an investor, of whom new ones appear in the market every day,
put their money in but railroad bonds and stocks. The rail¬
roads themselves, besides doing an unprecedentedly good husi¬
ness, are solving the problem of anti-pooling by direct and in¬
direct ownership of competing lines, and, under restriction ot
new lines to avowed needs, creating monopolies of territories
that give an immensely improved value to their securities.
Already these facts have in the past three months produced an
enormous investment buying and removed from the arena of
speculation a corresponding amount of railroad securities. That
alone would account for much of the advance in quotations; but
this is also to be considered; with the volume of available se¬
curities so considerably lessened, a moderate short selling move¬
ment creates a scarcity and prices can be easily run up. The
only thing that the public do not appear to see is that good
conditions do not last for ever, and that the average ought
to be the guiding principle in buying. Industrial shares are
improving under signs of a better understanding among the
managers of the properties they represent. If it could only be
believed that this good behavior would last, there would be a
rush of buyers to this side of the market, because considered,
with all offsetting allowances that prudence would require to be
made, many of these issues are cheap, particularly the preferred
shares. Even with the suspicion that always rests upon prop¬
erties run by speculating managers and the mystery with which
the reports of their condition are clothed, there is reason to
believe that a discriminated line of these shares could not fail
to pay in the near future.





SOME lessening is seen of the satisfaction expressed when
the British trade figures for last year were first issued.
While they bulk well and show monetary increases in both ex¬
ports and imports, these results are found on ejcamination to be
brought about in a way that does not promise well commer¬
cially. An increase of about $200,000,000 of imports is found
to be accompanied by no change in the volume of the goods re¬
ceived. There are variations in and exceptions to the rule, but
the final result is that the increase as a whole is due only to
higher prices. In tbe item of raw cotton, there is an increase
of about $65,000,000, of which $55,000,000 is increased cost.
The nation has then to face the facts, that it has been buying
raw material at high prices and that the quotations for manu¬
factured articles are now declining, with the prospect favoring
further declines rather than increases. In exports, again, coal
cuts so large a figure in producing the total increase and Its ex¬
port has so advanced prices on the home consumer that It is
doubtful if in the long run any real benefit has resulted from
the Improvement of this department of trade.   Qladatone's dic¬





tum, that excess of imports is a sign of wealth, though long
accepted, is being questioned now by economists alarmed by the
growing excess of imparts over exports. It is asked whether
this does not mean that as a nation the British have ceased to
save and are beginning to live upon their capital, which would
be a very serious thing both politically and commercially.. Its
possibility is, we think, rather too readily admitted, and the
train of thought into which economic writers have allowed
themselves to run is due as much to the unfortunate events that
have oppressed the British nation for a couple of years as to the
actual conditions of trade and finance. Otherwise, It would be
somewhat ludicrous to see a people just passing out of a pro¬
longed era of the greatest prosperity scare so much at the pros¬
pect of the bad times that always follow good as certainly as the
world goes round.





An Inadmissible Suggestion.

OUR Albany correspondent hints at a probable compromise
on the bills to tax banks and trust companies for State
purposes 1 per cent, on their capital, surplus and undivided
profits, on the basis of exemption of the same from taxation
for local purposes. "The Evening Post " openly advocates this.
It is evident that there- is something more than mere coinci¬
dence in this. If the thing is so pervading, it at least suggests
the direction in which the opposition to these bills propose to
act. Assuming that, it is also right that the public should know
what would be the. consequence of this compromise if accepted
by the legislature. First it should be stated that it was the
Tax Department of this city that originally drew attention to
the disproportion ot the contribution of the trust companies to
the public revenue to that of the banks. This was not done to
secure relief for the banks, but to bring the trust companies up
to the bank's level as taxpayers, except incidentally as the area
of taxation would be broadened the contribution of any part
would be correspondingly lessened, a process that would ben¬
efit real estate and the other forms of taxabies in common with
bank capital. This idea was embodied in the Stranahan bill
of last year, but, being in evil company, that of the tax on
mortgages, came to grief.

Until this year it has always been thought that the assess¬
ment should be made and the tax levied by the local authorities,
the State support being provided by what is known as the direct
tax.     This year,  however,  under the lead  of  Governor Odell,
Albany proposes, not to abolish the direct tax, but to render Its
imposition unnecessary, by taxing bank and trust company cap¬
ital for State purposes, though not as yet suggesting its exemp¬
tion from taxation for local purposes.     That suggestion comes
indirectly from the banking interest.     No doubt they would
be very glad to see it adopted, because it would simply mean
that their capital would be taxed at 1 per cent, instead of at
the local rate, which, in this city, was last year about 214 per
cent.,   and  in   1899,   2%  per  cent.      The  so-called  compromise
would be a tripartite deal made for the benefit of a duality.
That is, the State wouM get its income, the banks would have
their tax-rate reduced, but the city would be robbed of a valu¬
able tax asset.    The theft might be compensated to some extent
by an increase in the amount of taxes paid by the trust com¬
panies reducing the city's obligations in the matter of the direct
State tax; but that it made doubtful again by the difference in
the proposed State and the actual city rate;   and, probably, al¬
together destroyed by the expropriation of a legitimate local
tax asset.

In effect the compromise, so called, would reduce the actual
local tax valuations by $80,000,000,000 or $90,000,000, and the pos¬
sible tax valuation by as much more, all of which would go to
the State, but the State would not realize half as much as tbe
city would upon it. The difference would have to be mainly
made good by real estate. It is easy to see, therefore, why the
banks would prefer to pay the 1 per cent, to the State, and also
why the city would prefer to keep these taxabies subject to its
own assessors, and continue to pay the direct tax. At the
same time it would be obviously unfair to put the new tax on
bank and trust company capital for State purposes and leave
it still liable for taxation for local purposes as at present.
The proper thing to do is to leave matters as the are, with the
addition of making the trust companies liability to taxation
equal to that of the banks.





I





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N appropriating the additional money needed for using
marble in the construction of the new Public Library, the
Board of Estimate and Apportionment have acted with a proper
sense of the architectural and civic importance of the building.
The Library will stand, as much as any single structure can, for