Click image to zoom in (opens new window)
May 24, 1884
The Record and Guide
THE RECORD AND GUIDE.
Published every Saturday.
191 Broadway, N. Y.
ONE YBAU, in advance, SIX DOLLARS.
Conununications should bs addressed to
€. W. SWEET, 191 Broadway.
J. T. LINDSEY, Business Manager.
MAY 24, 1884.
It will be good news to real estate dealers tbat the Governor has
signed tbe bill to appoint a commission to prepare and report to
the next Legislature a series of measures to facilitate and lessen
the expense of transfers of titles of real property. It is now to be
hoped tbat the Governor will appoint a competent commission, and
one which will not procrastinate. The work has all been done to
hand by the very admirable Land Transfer Association, of which
Mr. Dwigbt H. Olmstead ia the pre:iident. That gentleman and hia
associates have gone over the ground thoroughly. Tliey have pre¬
pared in advance the necessary enactments, and have consulted
with the lawyers who know most about the law relating to real
property. Next winter should see this desirable reform fully con¬
summated. Real estate ought to be as good a collateral in bank as
government bonds, and it would be were it not for the preposter¬
ous impediments now in tbe way of the consummation of every real
estate sale. It is understood that the Real Estate Exchange will sug¬
gest to tbe Governor the names of a number of weU-known lawyers
from which be can select the right kind of a commission. The
Exchange should endorse no lawyer without tho distinct under¬
standing that he will be ready to report at the opening of tbe next
Jay Gould and Cyrus W, Field are doubtless anxious to settle the
dispute between the Manhattan and Metropolitan companies, but
are not probably in a position to accept Sylvester H. Kneeland'a
proposition. He is willing to sell the stock of tbe Manhattan Com¬
pany for bonds, bud tbis is no time to raise money for any such
purpose in WaU street. Field's counter proposition was simply
absurd. By a peculiar kind of book-keeping he tries to make out
that the Metropolitan earns less than 1 per cent., and then be offers
to pay 8 per cent, whenever the Metropolitan earns that amount.
In other words, he offers just nothing at all. To adjust tbis mat¬
ter satisfactorily, the whole dispute should be left to arbitrators.
The courta so far bave done nothing but prolong litigation, and
add to the exorbitant bills of the lawyers. In the meantime the
stockholders suffer, and iniportant real estate interests nortb of
tbe Harlem are injured because the connections whicb ave to be
made witb tbe Suburban Rapid Transit, tbo Nortbern New York,
and other existing and inchoate lines of travel cannot be effected
until the elevated system is worked as a unit.
It will ba a relief when the present Houae of °Represent atives
passes out of existence. The economies on tbe part of the
Government demanded by Messrs. Randall and Holman are of a
kind to make the United States a laughing stock for other nations.
We are potentially tbe richest and most powerful nation on earth,
yet here ia tbe most important committee of Congresa cutting
down tbe incidental expenses of tbe State Department for rent,
stationery, postage stamps, telegrams and the like from ^85,000 to
$15,000. Twenty-seven consulates are reduced and twenty-one
abolished. Tbere are to be no missions to eix minor countries, and
tbe usual appropriation for tbe care of indigent American sailors
abroad bas been cut off. In short everything is being done to
degrade us in the eyes of other nationa so as to save some $350,000
to a treasury whicb bas annually over a hundred millions surplus.
The comic papers ought to make these cheese-paring economists
as ridiculous in the eyes of the country as their official acts are
Tbs time is coming when there ought to be an understanding
among tbe well-to-do classes in tbia country. They should take the
government away from the control of the small lawyers and poli-
tioiana wbo cater for the votes of the day laborers. Funds ahould
be raised by voluntary subscription to pay our public servants
decent salaries both at home and abroad. Our ministers should
liva in equal state with those of other nations. Every Senator and
Representative in Congress should have a house of his own, and
not be forced to live in cheap lodgings. Every Governor should
have a State house, and the Mayor of New York ought to occupy
the finest house in tho city and have a salary large enougb to enter¬
tain distinguished strangers within our gates. The day of small
ecouomies has gone by, and looking after the "cheese-parings
aud caudle-ends" should be left to such "hole and corner"
statesmen as Samuel J. Eandail and William S. Holman.
During the panic of last week there was a notable increase of
investment purchases of good stocks. There are plenty of people
with means who know when securities are being given away,
and hence in every panic there are purchaeera ready to buy
stocks aud bonds outright and take tbem away from the market.
Capitalists of large means not only do tbis, but tbere are liter¬
ally tens of thousands of persons of limited resources, wbo are
willing to take cheap stocks representing good properties, and
keep them as a permanent investment. Hence it was noticed
on the tape that quite a large number of the twenty aud twenty-
five shares were quoted, but in every case the purchasers of
small lots were forced to pay frora a half to !i per cent, more tban
those wbo dealt in the regular hundred-share certificates. The
Stock Exchange ought really to encourage these small investors.
Tbey are very numerous, and the aggregate they aro willing to
spend in ready cash is always a decided relief to the market in
the money pinch. But in making a hundred shares the only
delivery these small investors are discriminated against. It is
with difSculty their orders are filled, aud tbey are forced to pay
more than other purchasers. In^London ten shares is the regular
delivery, and hence there are tens of thousands of investors there
who avail themselves of panicky times to add to their holdings.
The same is true of Paris. In none of the large cities of Europe
are tbere any places corresponding to our " bucket" shops. Oper¬
ators with limited means here are driven to these nefarious insti¬
tutions, because purchasers of small lots are at a disadvantage on
tbe Stock Exchange. The bucket shop would disappear from New
York were tbe small buyer to bave the same advantages as tbe
large purchaser on the New York Stock Exchange. Nothing puts
an end to a panic sooner than the appearance of permanent
investora in the street. Tbey pour a steady stream of cash into
tbe place where it is most wanted. It ia strange that this matter
bas uot received more attention from the Stock Exchange, At
present tbat institution discriminates against the small investor,
who should rather be encouraged, and keeps alive the bucket
shops, nearly all of which are as dishonestly conducted as the skin
The Proximate Cause of the Trouble.
AU the financial editors aro giving their theories of the recent
disturtance in Wall street. Bradstreet's thinks it is due to moral
causes, and was precipitated by illegitimate methods of doing busi¬
ness. The Financial Chronicle, which is never bappy outside the
facts it gives, say it was a mere stock panic, and that the general
business of tbe country is all rigbt. Tbe Chicago Tribune, wbich
often has very wise acticles, declares tbat the country is prosperous,
and that the trouble in Wall street was a mere local disturbance.
But are not these views all superficial ? We know, aa a matter of
fact, that after the exceptional prosperity which began with the
enactment of the silver bill in tbe spring of. 1878, and ended with
tho drought of 1881, there followed a period of liquidation which
has continued without interruption to tbe present time. Why we
were prosperous up to that date is easily accounted for. We had
immense crops, while those of Europe were deficient. The
cost of production waa light and profits were large. Our cur¬
rency waa doubled in amount by reaumption. Since 1381 our crops
have been relatively poor, pricea of agricultural products low, and
our profils very small. Then we have built too many railroads and
overproduced all kinds of manufactured articles. In four yeera
from the date of tbe last census we have increased, it is true, over
13 per cent, in population, but in tbe meantime we have
increased the mileage of our railroads nearly 40 per cent., and
an expert authority asserts that in the four years ihere baa been
an increase of 50 per cent, in many of the industries which supply
our population. While we have enormously increased oar capac¬
ity to produce manufactured goods, our consumptive power is not
much greater than it was four jears ago. In 1880 there
were 575 people to a mile of railroad. Three and a half
years later there were only 466 to every mile of road. Doea
not this tell the story of the immenae depreciation of
securities representing properties where railroad buUding
has been most active? With 40 per cent, more of stocks
and bonda representing our transportation system the roads them¬
selves have lesa businesa relatively than they bad four years ago.
Who can wonder at tbe shrinkage in Union Pacific, Denver,
Northern Pacific, and indeed in all the stocks which hav©
depreciated in value ? and wbo will say tbat the end has come
It is also to be noted that while we have added so greatly f o our
manufacturing facilities we consume about as much of foreign gooda
, aB ever. There is no market for our productions abroad, due to