AMERICAN LETTER.

Auckland Star, Volume XLVI, Issue 308, 28 December 1915, Page 9

AMERICAN LETTER.

PROBLEMS IN FINANCE. i DISASTROUS SPECULATIONS, j HAVE A SOBERING EFFECT. (By. Telegraph.—Special to "Star.'T XEW YORK. November 15. Undoubtedly the most interesting thing in the commercial life of America j to-day is the condition of affairs in Wall Street. All idea of the probability ot America taking an active part in the war seems to be definiteh- abandoned, the country is gradually adapting itself to the changed conditions of imports and experts, with the interna] reliance cle- | veloped for necessary progress in busii ness, and the niorp conservative financiers are trying to solve the problem of what will happen to stocks when the inflation caused by the demand for war materials, has ceased. Already the limits in the stocks wbich were most steadily soaring a month or two ago has been reached, and the eharp breaks in Bethlehem Steel, Crucible Steel, and oUer stocks that led the witches' dance, I brought a good many indiscreet or inex- , perienced traders to their knees, if not j to penury. When statements were brought out for the business, during the firet nine months of the year, of other companies the stocks ot which had gone j far above par. and which had made dpI fie its instead of dividends, the realisation ■ seemed to have a. sobering effect upon j the speculators, and the rush to cover ■ caused for a few days some 'little alarm, jbut a gradual switching of the inflated I investments to others of more stable and less pretentious character, a good many of which are coming up. had the effect ■ of preventing anything lige a stampede . or a crash. This was, of course, aided by easy money conditions, and by the fact i that the losers were, in the great majjority of cases, the "lambs, -, who had I been speculating with their savings, instead of capitalists whose losses might have stood to affect the financial standing of important concerns.

As illustrating conditions, the state- I ment of the Steel Foundries Co. for the nine months ended September 30 disclosed a deficit of nearly half a million dollars in that period, yet the stock had gone from 4G to 74*. Crucible St.eel showed net profits for the year ended j August 31 of 3,073,75 C dollars, equal to j 12.2S per cent on 25,000,000 dollars pre- I ferred stock, upon which 25 per cent of ; unpaid dividends have a-lready aarumu- J lated, and there is therefore no imrne- ! diate prospect of disbursements on the common stock in such a showing. Yet i the issue ha= recently sold at 9 i -o above ] par. There eeems no question that such i statements were perfectly correct, and I gave emphatically the precise facts oi j present business in order to set the com-1 munily right concerning the illusive > basis that the brokers had been working ! upon to delude speculators. Yet these same well-intentioned statements were bitterly denounced by the stot-K jobbers, who accused the officials oi such companies of ulterior motives, and continued to exaggerate misleading stories about war profits in order to give fictitious values to the stocks they desired to sell. Thus the stock market situation cannot as yet be at al] regarded as squared for permanent prosperity, nor will it be so long as the preponderance of business originates in the war demands, but with new stocks, such as those of flying machine factories, which are shipping hundreds of aeroplanes to Europe, steadily coming up. and other concerns asking investments and seeking the superabundant zeal and dollars of the speculators, the distribution of the reckless money at large may be so directed as to avert a serious disaster. As the attractions of war stooks and specialities diminish indeed, railway issues and seasoned industrials of a non-belli-gerent character are coming more and more into 'favour. That the market shows a guiding and directing hand seems unmistakable, and the situation is the better for the broader diversification of speculative interests.

THE WALL STREET RUSH. Interesting incidents or the Wall Street rush during the boiling market included the overworking of tlie clerks in the exchange and brokerage houses. , A number o£ such establishments placed cote and beds in the office buildings at the disposal of their helps, and some firms even went to the trouble and expense of installing shower baths. The tremendous activity, however, brought too great a strain on many clerks, and compulsory vacations thus necessary only added to the work of others, for all of which, needless to say, there will be important remembrances at Christmaetide. Of course there are a good many instances of great profits on very small ventures, such as that of a young Irish lad at a leading hotel who had saved 350 dollars from his wages and tips as bell-boy', and sold out 'his stock ventures of that amount for eleven thousand dollars. Then there is the record 01 William Marshall, a consulting engineer, who advanced a thousand dollars to a Dane named Weden who had invented a machine gun. The invention is now returning to Marshall thirty million dollars in commissions on the sale of three million guns to the French and Russian Governments. MONEY IN MOTORS. A comparatively neglected, yet steadily appreciating; line of stocks at present is that of the great automobile manufacturing concerns. Despite the fact that many cheap and unreliable productions in the way of motor cars have made their appearance, there is still a demand by wealthy patrons for machines which afford the acme of speed and luxury, regardless of expense, and it is the manufacturers who -jater to this demand vrho are able to show the greatest profits. Of course some of the American manufacturers of cars have been able to enormously increase their outputs by war orders, but the home sales have been the strong point of all, and an extra quarterly dividend of one per cent, to the regular U per cent oi [the Studebaker concern, which -had been paying 5. per cent since nine months ' ago, was not anticipated, while the announcement that a regular 10 per cent return to stockholders is soon probable was also cheering news. This company had taken a long time to corns clear of debt, but it is now upon the basis of having only the outstanding obligations of come two million dollars of serial notes beginning to come due next March, and which are amply provided against. The common stock has lately fold uj to 70 doll?

CHEAP CARS NEXT YEAR.

An interesting case of an automobile company that did not make good was brought to light by the suit of the National Surety Company against Daniel 1L Brady for the payment of a guaranteed note for . £500 given by Brady, along with others who made up a fund of £25,000 obtained by the Orson Automobile Company on a chattel mortgage from the Farmers' Loan and Trust Company. Mr. Brady is popularly known as the Brass King, from hie extensive interests in brass manufacturing, and sometimes as "Brass Dan" to distinguish him from his brother "Diamond Jim" Brady. It developed that Mr. Brady had also parted with £7SO for an Orson automobile, which after another £200 worth of repairs, "blew up" about the time that the manufacturing company became insolvent, in December of last year. This company was organised in 1910 through the efforts of Mr. Horace M. Kilbourn. vice-prasident of the National City Bank, who offered to a number of the bank's depositors the chance to '"come in on a good thing," in the shape of an automobile company which his brother Orson was organising. He readily found 100 men who subscribed £500 each and agreed to take a car at that price. With £50,000 on paper, but in plain sight, pledged by wealthy friends, most of whom carried large accounts in the National City Bank, nothing was easier than starting the company and ! getting half that amount in real money from the Farmers' Loan and Trust Comj pany, upon a bond from the National Security Company, which in turn took notes individually from the 100 stockholders and prospective car-owners. The alleged cause of failure was that the business was not properly conducted, nor the assets conserved. It is none the less important to note in a general way that the practicability of cheap motor cars has been determined upon by some wealthy Philadelphia men, who say they I expect next year to have upon the mar- } ket a good serviceable runabout at a selling price of £22, which will give a profit of more than ten per cent, on the (manufacture. AN INTERESTING FRAUD. An» interesting fraud on the United States Government in connection with the war has been unearthed by the publication of the names and alleged ad-j dresses of people to whom the Govern-' ment, through iU consular agents in i Germany, advanced money for their return to America when the war started,' there being a great many tourists at! that time in Europe who were unable to obtain funds in a hurry for thoir return I expenses. Those to whom such money I was advanced gave promises that it ! would be returned to the Government, '■ but the lists show that while the j- amounts in some cases ran as high as j £200, a great many of the people are i unknown at the addresses given, while I about one-third of the names are) j German. I I WOMAN SUFFRAGE. I The principal issue at the annual elec- ! tiiiii.s this month was the question of ■ woman suffrage, which was put to the •.vote in three States—New York, Penal i sylvania, and Massachusetts—and de- j ! feated overwhelmingly in each. To i understand this thoroughly it must be remembered that voting in the United States does not depend upon any property qualification or any other qualification, but merely upon citizenship, and if suffrage were adopted the number of eligible voters would be immediately increased by the names of ail the women who cared to register for the privilege. The pre-election betting in New Yorkl was 4 to 1 against suffrage, while the' 1 returns showed that two out of every j 1 three votes were cast against the measure. Only five counties of the State \ voted for the women, and all the large I cities went heavily against them. The revised constitution for the State of New York was rejected by half a million [ votes, which means, aiiiong other things, that there 13 no relief from the city paying 70 pe.r cent, of the State taxes and there is no chance for further j amendment until 1010. The State of Ohio defeated prohibition by an overwhelming vote, but Virginia cast a heavy vote in favour of the. measure, which will become effective there on November 1, 1010. The Tammany Democrats resumed power in Xew York City by a large majority. In only four States thus far has a woman suffrage amendment been ac- [ cepted on its first referendum to the ; voters; Idaho, in 1890; Arizona, in 1912; i Montana and Nevada, in 1914.

PROHIBITION POLL. The British colony of Newfoundland gave an unusual result to the question of prohibition a,t an election the other da>. The voters throughout the colony cast a large majority in the aggregate in favour of the proposition, but the method of the election shows a decision against it. By the regulations of the election it was specified that unless the vote in a district -was more than 40 per cent, in favour of prohibition, that district would be recorded, as against it, and the voice of the colony would be regarded a≤ specified by the majority or minority of districts for or against the proposition. Thus the colony as a whole defeate4 the question. FIRE IN A SCHOOL. Doors swinging inward instead of outward and causing a jamb of school children auainst them during a fire-panic the other day at Peabody, Mass., caused a loss of life of 51 of the pupils, while double that number were more or less seriously injured. Six hundred and seventy-five children wjre in the building when the fire started. A PHOTOGRAPHIC FRAUD. The New York Board of Education has just nipped in the bud an extensive scheme to make money by a company of photographers . who . had cajoled the truant officers into permitting photographs to be taken of all school children as a matter of identification and as a means of eliminating truaruy. Incidentally, however, the pictures were to be kept on sale to the children by the teachers, the latter being made agents | of the photographic company. Some of, the enterprising parents of scholars protested, and the business was squelched. MISCELLANEOUS ITEMS. A curious labour law of the State of Arizona has just been declared unconstitutional by the Supreme Court of the United States. The Arizona legislators had declared that an employer of more than five persons in thai Stato must employ at least SO per cent of qualified electors or native-born citizens.

That the average length of life has •been increased by ten years in the United States in the past quarter century has been declared lyr the nuMKraU

associations, .but it is admitted that this average has teen made 'by the lowering of infant mortality.

The open-ing of a new milrjon-dollar store in Fifth Avenue has again demonstrated that io be the retail shopping centre of the future, although it is admitted that business is not likely to go farther'north than 57th Street, which marks the lower end of Central Park, where the city is divided by the park for two and a-half miles, of its northward trend, and for a number of years yet the shop s will not go above 42nd •street. The present new structure is that of the old firm of Arnold, Constable, and Co., founded in 1827 by Aaron Arnold, who had just come from England, and which has been for a longtime at Broadway, and 19th Street, and almost exclusively in the wholesale line of clothes, draperies, women's wear, etc. The new building is at Broadway and 40th Street, 82ft x 175 ft, with an ell 25ft wide through to 39th Street, and is- a six-storey white limestone and granite structure. The business was incorporated only two years ago, with a capital of £500,000, but the original Constable was a son-in-law of the original Arnold, and the stockowners are ail in the family.

An eminent American business man who died on November 6, at the age of 81, was Peter A. B. Widener. of Phils, delphia. Mr. Widener started in life as a butcher, and when he had amassed about £20,000 he became an oil trader, subsequently becoming interested in street-car lines and acquiring control of the principal routes in his city. His wealth is estimated at upwards of £20,000,000. On the death of his wife in 1596 he spent £2,000,000 in memorials for her, including a home for crippled children, which he endowed with £600,555, and added to it another £800,000 on the loss of his son George in the Titanic disaster. He bad become a great art collector, and leaves much to libraries and institutions. He at one time owned some of the most magnificent yachts afloat.

I Christmas in the shops this year will be conspicuously marked by the arjsence of European toys and gift goods. The American makers of clocks and watches have, however, made special efforts tomeet the season with new designs, and the offerings will include a greater variety than ever of useful thing 3in dress goods, stockings, all sorts of beribboned creations, and household adjuncts, it . is stated that the fad for rugs instead of T J carpete, which has steadily developed ! for many years,, is now being limited to j rugs for apartments, the occupants of which never expect to be very pennan-1 ent. while the owners of houses are j again acquiring the idea that harmonious carpetings give an impression of more complete furnishing. [

A great State funeral takes place m] Halifax, Nova Scotia, to-morrow, that; of the late Sir Charles Tupper, Bart., j who died in England at the age of 94., Sir Charles was the last surviving mem- j ber of tho original Council of the Dominion of Canada, and had hcen an ] active politician the greater part of his i life. He was a practising physician in j a country town in his native province; before he entered politics. His title j descends to his grandson, his eldest son! being dead. ! One of the police mysteries of Brook-! lyn, New York, has been the death of! an unknown man who was found, cix weeks prior to his death, lying on a truck in a vacant lot with a broken loft arm, and a bruised left eye. Hβ was , never able to talk beyond stating his I name as Daniel .McLoughlin, but after j death an autopsy revealed the fact that 1 a fountain pen had been driven into bis! brain through the bruised eye, penetrat- , ing the centro of the brain to a depth of j six inches. It had been evidently driven Jin with a mallet, and the murder may I have been committed anywhere. In its issue of September 23 the ".Star" pave ,a recipe for an imitation of the famous American pumpkin pie, to bp made from veectable marrow. It is all right except the direction to "cover with crust." No one over snw a pumpkin pie covered. There is nopastry except the bottom, and a good rim. the pip being shallow, not more than an inch thick in the middle. Custard, cocoanut and cranberry pics arc also always without a pastry"coyer, but sometime cranberry pies have cross-bars.