Columbia University Libraries Digital Collections: The Real Estate Record

Real estate record and builders' guide: v. 43, no. 1100: April 13, 1899

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April 13, 188& Record and Guide. 499 If*. . ESTABLISHED ^ lAARPH 51'J^ 1868. ^ DEvfiTd) TO Re\1. Estate , SuiLoi^J'o Aji,ct(iTECTdR,E .HduseiIold DESOHftTiotJ. BUsitJESS dv Themes of GeiJeraL I;>(tei\est PKICE, PER VEAR IN ADVANCE, SIX DOLLARS. Published every Saturday. TELEPHONE, . - - JOHN 370. ■'(tommunlcatioiis should be addressed to C. W, SWEET, 191 Broadway. /. T. LINDSEY, Business Manager. Vol. XLIII. APRIL 13, 1889. No. 1,100 Secretary Windom's liberal purchasea of national bonds settle the question that there is to be no extra session of Congress to vote large appropriations for improvements, so that the surplus in the treasury could be used productively to '.help the legitimate business of the country. Ex-President Clevland's policy of making a present of the ti'easury eui'plus to the wealthy bondholders and corporations is to be continued, though fche motive in each case is different. The retiring Presidenfc wished to force Congress to reduce the tariff; the new President probably wants the next Congress to revise the tariff wifch a view to increasing the revenues, and hence be will not only do what he can to dispose of the present surplus and reduce the debt, but wUI favor some more pension legisla¬ tion to further waste the funds of fche nation. The situation is anything but reassuring. When Congress does meet there will be no money for internal andharbor improvements, for rehabilitating our merchant marine, or beginning the gigantic work of defenses for our sea-coast cities. To raise new funds there will be a proposed tariff revision, which will still fiu'ther unsettle the business of the couutry ; but, while trade will suffer, Wall sti-eet may have occasional good times, for bond-buying by the government always starts speculation in the "sfcreet." We all know what happened wben the government stopped purchasing its own debt obligations in July, 1887—securities of all kiuds got a "black eye." The fall of that year saw a reuewal of bond-buying and a consequent revival of speculation, alfcliough the raih-oads of fche country were in a deplorable condition in the spriug of 1888. Secretary Fairchiid's circular of April of last year made a bull mar¬ ket. From July fco Ocfcober there was a steady advance in prices due to bond purchases, although the railroad wars in the Wesfc were bankrupting the wealthiest aud the most powerful railroad corporations of the country, such as B. & Q,, Atchison, Rock Island and Missouri Pacific. Secretary Windom's liberal purchases of bonds has revived speculation in Wall streefc. The highly respectable banking firm wbich represents the Barings in this country have gained a deal of eclat lately by their endeavor to bring about a change in the Atchison Company. But is there not somebody to blame besides the directors of that great raili'oad corporation. In something over three years the capital stock and bonded debt was not only doubled but trebled. It found no diffi¬ culty in selling its stock, or marketing its bonds. The bulk of the latter were placed through this very banking concern, wbich hasat last discovered that the railroad was managed in a most reckless manner. But ought uot the Barings or their American representa¬ tives have kuown all tbis in dealing wifch the officers of fche Atchison Company. Their means of information were very mucli better tban that of the general investing public, to whom the banking house sold the bonds. It ought to have struck them that this sudden crea^ tion of an immense debt must have been perilous business for even the most solvent corporation, but it seems they "were content to sell the bonds aud pocket the commissions until tbe imprudence of the company became manifest to the operators iu the stock market. After the steed was stolen tbey came to the fronfc to lock the stable door. Iq other words, after the investing iiublic got rid of their money, the bankers announced that they proposed to change the management of the Atchison Company aud asked the stockholders to Ijelp them. So far bankers have generally not dealt fairly with investors. All they have seemed to care for has been their monstrous commis¬ sions. The great investing public was a goose to be plucked. The leading banking houses of the world would cut a very sorry figure were any oue to publish the loans they have floated on the market. It would be found fchafc some of the most respectable houses have raised money for the most hazardous and speculative enterprises which were almost certain to come to grief. There is, however, scaBcely any danger of exposure. These bankers are, or may be, generous advertisers, and our newspaper press never quarrels with fche supply of bread and butter, The journals of "to-day would no more open fire on the bankers than they would on the patent medicine vendors, and for the same reason. Then, again, a news¬ paper that would be honest in the matter might be discredited by a cry of blackmail, which is easily raised and hard to disprove. Still we think this reckless lending of money to corporations on its issue of bdnds has received a check. It is evident that the great concerns, like Drexel, Morgan & Co., the Barings, etc., are supposed to give some guaraniee to investors thatthe money will be safely placed. People who buy bonds hereafter from great houses will have a befcfcer show for their money than they have had in the past. It is very evident tbat the Western situation is in much better shape than it would have been had there not been some co-opera¬ tion among the bankers to secure better management for the future. It will be remembered that at the original meeting of the railroad presidents at Mr, Morgan's house, in this city, last December, Mr. Roberts, of the Pennsylvania Central, very frankly told Mr. Morgan that the bankers were greatly fco blame for placing loans which pracfcicaliy encouraged reckless overbuilding. This fche greafc banker did not deny, and he promised that in the future more cai-e would be exercised in this matter. There are signs that the public mind is assuming a saner attitude towards the Mauhattau Company in relation to the rapid transit problem. We publish elsewhere iu this issue a third series of inter¬ views with prominent citizens as to the advisability of grantino- the elevated roads permission to construct a third track for express trains and a " loop " in the Battery Park. These interviews in The Record and Cdide have clearly demonstrated thatthe press of the city does not truthfully represent public sentiment by ifca attitude of uncompromising hostility to fche Manhattan Company. Prejudice is no guide to the solution of the problem which confronts the city, and people are beginning to see fchat the urgent demands of the houi" can best be met, indeed can be mefc only, by improving the system already iu existence. The public are also learning that the rapid transit necessities of the island, for the present and the future, cannot be provided for by any one scheme. There is room nofc only for whatever Mayor Grant's bill may bring forth, bufc for the Arcade road and the cable system. This saner view of the matter is even being taken iu Albany. Mayor Grant's measure apparenfcly wiU be passed without any hampering amendments. Mr. Hamilton, who is the advocate of the cable system, said in a speech on Wednesday: "I am generally opposed fco our giving up any portionof our parka; but in this case I think a portion of the Battery Park might be given to the elevated road for its use, without material harm to the city's interests;" and Mr. Crosby, who introduced Mayor Grant's bill, promised to suijport a measure granting the Manhattan Com¬ pany fche facilities they need. These are indications that at last common sense is to play some parfc in the rapid fcransit question. The Manhattan Company does not seem to know how to deal with fche press. It made a curious and characteristic blunder last week. Noticing that the publication of the Battery Park loop map in The Record and Guide made a favorable impression on the public, its officers hired some scribs further to elaborate Che loop project with diagrams, description and the like. As the Sun news¬ paper had net shown the rank prejudice against tbe Manhattan Company that the other papers did, the article was gotten up as if written by a reporter of the Sun. The Manhattan officials having fche matter in charge supposed there would he no difficulty in pub¬ lishing it in fche Sun as news matter, but that journal makes it a rule—as indeed do all first-class newspapers—fco publish no paid-for matter without explaining to its readers that it is an advertise¬ ment. The article was accepted, but fco the mortification of the Manhattan people the letters " Avt." at its close toid the story of its origin and purpose. The Times publishes such articles for pay without notifying its readers. It will abuse Jay Gould without stinfc ; but has frequently published interviews with him, for which he paid cash down. ----------■---------- But the interviews we have been publishing for the past three weeks show that our press does not represent iu this case tho mass of our fellow citizens. We have given fche unbiased opinious of representative bank presidents, real estate owners and dealers, bmlders, architects and merchants in all departments of trade. Among them we have found no echo of fche active dislike to the Manhattan Company shown by the Times, Herald, World, Evening Post and other daily and weekly publications. The Record and Guide cau safely claim to be the first and only journal to point out the fact thafc if we are lo have auy immediate relief in the way of rapid transit the Manhattan Elevated is the only railroad fchat can give it to us. We have been pointing out for the pasfc two years that an additional track on the 3d and 9th avenue roads would save at least twenty minutes time between both ends of the island, and enable the company to carry one-third more passengers. We have also urged the widening of Elm street to accommodate ancther elevated road, as well as the construction of another branch on the