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March 17, icjoo.
KECOlil) A^D GliDE.
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Communications should be addressed to
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7. T. LINDSEY, Business Manager.
•Entered al ilic l'osl-0/fice al A'tiw York, ,V. 1'., as secoiid-clus» mallei:"
MARCH 17, 1900.
\ X 7 ITH two such events occurring as the signing of the
W Currency Act cn this side and tlie tremendous over-
subscripLion cf the British war loau on the other, it is surprising
that the markets on hoth sides of the Atlautic do uot display
more activity than they do. Scarcity of money is said to re¬
strain speculation and prevent indulgence in the only form of
jubilation the security markets know w^hen they celebrate a vic¬
tory, namely, an advance in quotations. Without a deterrent of
considerable force the important events mentioned would doubt¬
less have been recognized in the orthodox way. So strong is
this rule that we cannot help thinking that the celebration is
only deferred until the way is more cpen aud the generosity of
the banks makes it more easy. As it is, a little activity and
strengthening can be noted in the bond market; not very much,
it is true, but enough to suggest the coming of something better,
especially as it is most noticeable iu bonds outside of the gilt-
edge list and in these of the speculaive class. There is money,
much or little as it may be, seeking investment, and there is
really nothing now to attract it but bonds of tbe lower grades
and new additions to tbe ranks of dividend payers among stocks.
Third Avenue is less of a wet blanket cn the market than it
has been for some time. When the stock was lowest we pointed
Dut that the selling had been overdone, and that opinion is more
than confirmed by the advance in the face of the receiver's report,
which is a most perplexing document to outsiders. Some familiar
with the property have apparently the key to the riddle, and if
they are willing to buy on a statement that reveals to the unin¬
itiated little else than confusion, the outsider is unwise who goes
counter to their view. Official explanations of the new Currency
Law wbich have appeared in all the daily papers serve to slioW
its practicability and value; the dangers it removes, either of
fears of a tampering with the legal standard of value or of an
insufficiency cf currency to meet the enlarged demands of the
commercial community. Jnow large these demands may be at a
particular moment is illustrated by the recent distribution of
many millions of dcllars by cne company, tbe Standard Oil, in
dividends, the preparations fcr which, by the way, must have had
something to do with the advance in the rates for money s^een
recently. Though the market has failed to respond to much
good news and is mainly professiona!, there is no reason to take a
gloomy view of its near future, because it only needs a little
more confidence iu the sufficiency of circulation, which the op¬
eration of the Currency Act ought to produce very soon, to create
more activity with advancing quotations.
THOSE who have followed the discussion of the question of
tax reform in this State are under the impression that
the necessity for that reform arose from the injustice of casting
all public burdens upon real estate. This was claimed by friends
of real estate and admitted when the Ford bill defining franchises
as real esate and taxing them accordingly was passed last year.
It was also admitted by the Governor in his message to the Leg¬
islature at its opening this year and by the framers of the Stran-
ahan-AIlds bill, though the relief they proposed, so far as it re¬
ferred to the tax on mortgages, was considered by many as likelj
to be of doubtful efficacy. If that bill failed adequately lo re¬
lieve the necessity that called it into existence, how much more
so does the amended bil! introduced by Senator Stranahan last
week with its exemptions to placate certain opposing elements,
but those whose property it is absolutely necessary to reach for
purpoBes of taxation, if real estate is to experience any substan¬
tial relief. Apart from that, a bill that discriminates in favor of
people who can borrow money at low rates of interest^four per
cent, and under—is certainly not much assista,nce to the strug¬
gling and needy who have to pay rates high in proportion to
the urgency of their needs and the smalluess of their means. It
is no woaider, then, that the introduction of the discriminating
amendments have increased tbe opposition to the bill and tbe
weakness displayed by its friends in departing from the principle
originally laid down of reform of the tax system by a fair and
equitable distribution of its burdeuB on ali classes of property
and people, apparently has deprived tbe bill of what little chance
of success it had in its original form ,
Looking to the Future.
INFLUBNOES OF THE CURRENCY ACT AND THE FATE 0(F THE
MORTGAGE TAX BILL.
IN the Tt-eai EstaCe Salesroom this week the offerings at vol¬
untary, partition and executors' sales comprised thirty five
improved parcels (dwellings, tenemients, fiats and a couple of
mercantile premises) in Manhattan and seventy vacant lots
in Bronx. Of the lots, half were sold; of the Improved pieces,
Ofteeu. The foreclofiure schedule contained some thirty offerings,
which, deducting the usual proportion of adjournments, were
bought almost exclusively by plaintiffs. The brokerage reports
disclose a similar condition of Inertness in the private-sale
branch of tbe real estate market.
Apparently the only probable means of reinvigoration in sight,
so far as the immediate future of the market is concerned, are
the new currency act and a prompt settlement of the mortgage-
tax agitation. Some brokers think that the currency act, in the
course of the year, will cheapen money to such an extent as to
induce real estate speculation acd investment on a large scale.
However, competent financial opinion is divided as to the influ¬
ence which the act will exercise upon the circulating medium—
whether the vclume ot currency will be notably or only mod¬
erately increased. Precise observations as to the act's effect on
real estate are, therefore, impossible. Nevertheless, there will
undoubtedly be an appreciable tendency toward chaper money.
A feature of the act is that, by facilitating in every section of the
country ample bank-note issues in response to local
temporary demands for currency, the traditional move¬
ment of capital at certain seasons, particularly the crop-
marketing mcnths, from New York to the interior will
Ije checked. The New York banks, in the absence of the tradi¬
tional drain, may find themselves in a position to offer money at
low terms in the late summer and early autumn, with the result
of infusing some animation into that customarily stupid period.
One thing may be taken for granted, namely, that any con-
siderablo augmentation of the currency wiil result in a fall in the
general interest rate on money. With speculative building
checked, with rents stationary or, as is the case in some forms
cf realty, rising, a fall in the interest rate would mean immedi¬
ately a corresponding increase in the net income from improved
real estate, some part of which would ultimately be capitalized in
the fee value. A substantial increase in the currency would,
further, prolong the existing period of industrial prosperity, and
thus, by augmenting the production of wealth, augment the com¬
munity's ability to buy homes and acquire real estate.
The Stranahan bill does not appear to gain friends as time
goes on. It was denounced Thursday night by a meeting at the
AstOT House of representatives of fifty-seven building and loan
associations in the State. The United Real Estate Associations
cf New York, through their president, Henry Markus, are issu¬
ing a circular in which the defects of tbe bill are clearly summa¬
rized. T'he introductory remarks ol the circular read: "Tbe
United Real Estate Associations of New York, having 3,200 mem¬
bers, of whom few are wealthy and many own mortgaged prop¬
erty, have unanimously adopted resolutions comdemning the
Mortgage Tax bill. The Real Estate Board of Brokers and the
West End Associations, composed of real estate'owners, have
taken like action. We protest against the burden of supporting
the State being placed upon the owners of mortgaged real estate.
The amendments to the bill make it more unjust than before.
Wie approve of the Elsberg bill, because it will promote economy,
fix the responsibility for extravagance, abolish equalization, ap¬
portion the State tax fairly and permit the exemption of mort¬
HOW many kinds of a scapegoat is the owner of real prop¬
erly to be? Just now the District Attorney threatens to
hold htm responsible for the neglect (?) of the police in permit¬
ting gambling and other illegal occupations to be carried on in
this city. That is to say, the person who pays the policeman is
to do his work also. Any property owner who violates the law
which forbids him to let his premises for certain purposes de¬
serves to be punished and is punished from time to time, but
what the District Attorney threatens is to hold the owner of the
premises responsible for wrongdoing therein, whether he Is cogni-