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THE ATLANTA GEORGIAN AND NEWS SATURDAY, APRIL 27, 190T. railroad stocks supported BY GOOD AND TANGIBLE ASSETS: REPRESENT ACTUAL VALUES 'in reply to the Indictment so often made against railroads In halls of leg Ertatl«n and by public speakers and thi „ re «s that the watering of their stocks Jut of all proportion to their actual vslue Is responsible for burdensome charges upon the people, the neglect of rolling stock and equipment, resulting In the delay of freights and the de moralization of schedules, the follow ing defense, prepared by a staff con- hbutor nnd printed in The Railway World Is interesting as affording a fair idea of the "other side” of the question: Talk o{ "Water” Flippant, people talk as glibly about water In n ilroad stocks os they do about a liver overflowing Its banks during a Jan- nnry thaw, and no doubt many persons, on account ot their talkative habits, have come actually to believe that vhat they eay of railroad etocks It lit- emllv true. No distinction Is made; •II railroads shares are put In the samo Class by the unthinking public. Thle flippant talk, however, Is causing other uni wiser persons to ask themselves v hat constitutes water In etocks, and the more they reflect upon the Inquiry the farther they appear to be.from a jiilifactory answer. A company may he operated for years without paying anything to Its shareholders In ttje way of dividends. Year after year earnings are appropriated for improvements for iccond and third tracks, for better ter minals. for equipment. In fact for the thousand and one requirements of a railroad whose management has a care for Its condition In order that It may fulfil It* obligations to the pub lic. At length as a partial restitution to the shareholders they are given a cer tain proportion of new shares without cost. Is the new Issue water? The public will say It Is, but the sharehold ers who have received not a. penny of Income upon their Investment will say no. The shareholders will assert that for every dollar of new stock lasued there has been put Into their property out of the earnings three or four dol lars, that there Is good value In the way of tangible assets back of every •hare Issued which represents new capital Just as much as If the share holders had gone down into their pock- etc to produce the money required for the Improvements. Thus It Is that the new shares represent an actual Invest, ment of capital or a large quantity of aqua pura. Just according to the point of view. Invettor Worthy of His Income. Just as the laborer Is worthy of his hire so Is the Investor worthy of an Income upon hie investment. Having been deprived of the Income to which he Is entitled, in order that the public may be benefited through a diversion of earnings to an Improvement of the properly. It follows that the Investor la entitled to bo made whole In some manner. The simplest way to accom plish this Is by an Issue of stock which h distributed pro rata among the rhsreholders without cost. When In tuturc yeurs the company has pros- lered so that It may pay dividends the new shares Issued In the above manner are just as much entitled to receive dividends as are the original shares for the reason that the new shares represent capital actually In vested An old method of "watering” stock, not much In vogue now if at all In the financing of railroads, was to Issue shares ns a bonus to aid the sale of bonds. In those days railroads were built out of the proceeds of bond sales and It was due largely to this fact that many railroads had to be reorganized. As an example, the subscriber for a bond of tl.ooo would be entitled to req reive five.shares of stock of the par value of $100 each at a bonus. Thus, for each $1,000 paid Into the treasury of the company there was Issued 11,BOO of securities, of which $500 might be considered "water” pure end simple. Day of Reckoning Came, There was a day of reckoning for such railroads and when the crisis came the bonded Indebtedness had to be icaled down, the rate of Interest was reduced, the old shares of stock were canceled and new stock leeued only to such persons as paid assess ment into the treasury. A multitude railroads In the West and South, and some In the East have gone through this process of reorganisation hlch the water has been thorough. ly squeezed out, Doubtless a careful woo'mIi. 0 * *¥ h °? th **® roa<) * today r h °.r ■ h r i hat the ™ u n ° wa, * r » o.oL ,toclt *' but In fact there aro val- “ aa '® aszete equal to the par value of ,tui ,he thoughtless “auw talk of watered etocke. PORTED—ED PAGE Thursday ,.J a rman Kn app. of the Interstate commerce commission, recognizee thle error on the part of the public when ne says: the common talk about the overcapitalization of railroads as whol ly !&" or * n t and mistaken. I believe tnat in far more instances than the people suppose a fair valuation at this time would give figures exceeding the nt .i C * t ! tna *.®' **F thought in thle connection Is, that an official valuation of railroad properties resulting, as I believe It would In most cases, In an aggregate not less than the present par value of the stocks and bonds, would give an assurance and credit to railroad securities which they now lack in many ?? a ??.!?® caua0 ot ,h ® widespread belief that' they represent a large volume of water. I suppose It Is the element of uncertainty which gives opportunity to the gratification of the gambling In stinct. It is difficult for me to explain the wide fluctuation In many railroad stocks except by assuming that the public la uncertain and apprehensive aa to the value they represent.” Another Difficulty Met In an article In “Moody's Magazine” for April, John B. Dalsh write*: “An other difficulty which la met Is to as certain what Is the proper capitalisa tion. Numerous theories have been ad vanced but no one of them seems to have received the approval of the courts. In considering this matter tome argue that there should be con. sldered the original cost less the depre. elation. If any, and an addition for the Improvement: others argue that the value should be determined by a con sideration of the amount of securities outstanding and their present market value; others argue that the cost of re production la a safe guide; other* say that the matter should be determined by ascertaining the fair market value In the same way as the Value of real estate Is ascertained In eminent domain proceedings; others argue that the value at a going concern ought to be considered. Perhaps the real truth, If we could get at It, lies In an appropri ate consideration of all these heads to gether with the constituent elements of each." It must be clear to the reader by this time that the subject of “watered" stocks Is somewhat complex; that all Is not water that trickles. Qulte'ln contrast with the methods noted above is the policy of some of tho larger and most prosperous rail roads of disposing of netv stock at a premium. Shares ltave been sold out right to present stockholders for cash at a premium of 30 per cent. They have also been given In exchange for collateral trust bonds at a premium of 40 per cent, to that the railroad Issuing tho stock was receiving In Its treasury money considerably In excess of the par value of shares Issued therefor, a proc ess Just the reverse of watering. Dur ing the past eight years the Pennsyl vania railroad, which Is conspicuous for following the policy last - noted, expended over $$00,000,000 of capital upon Its roadway and equipment, a “ of thle eum coming from ROCKEFELLER GIVES AWAY $2,000,000 TOCHICAGOCOLLEGE Also Transfers $750,000 in Real Estate to His Son. New York, April 27.—Wltli advanc ing age making dally Inroads upon his health, John D. Rockefeller has begun to turn his enormoue fortune over to his son, and to dispose of his real es tate holdings. This fact was emphasised today by the transferring of real estate In Cleveland valued at 2760,000 to John D. Rockefeller, Jr., and a gift of real estate worth $2,000,000 to tho Univer sity of Chicago. large portion premium* upon stock Issued, from profits obtained through the purchase and sale of the stocks of other compa nies and from appropriations from earning! year after year for extraor dinars' expenditures. Thus the Penn, sylvanla shareholders have a large equity In the assets over the par value of their shares, an equity which makes talk of water In Pennsylvania stock seem absurd. If a valuation of this company's assets Is ever made It will be found that there la 2140 of value hack of each 2100 of slock and that the 7 per cent paid as dividends on the par value of the etock Is equal to only 6 per cent upon the actual value of the ■hares as represented by the capital Invested. There are other companies that will doubtless make as good a showing If a valuation of their assets Is ever made by the government. As to Collateral Trust Bonds. Iconoclast* who are Inclined to scoff at *11 modern methods of finance have paid their respects to the collateral trust bonds, which they regard ai one method of creating overcapitalisation. The Reading-Jersey Central 4s afford a good example of this class of eecurl- "THE FRIEND8 AT HOME.” But, nevertheless, John Temple Graves Is one of the elect. He can not say anything that would spoil .‘:lm to thousands and thousands of friends and admirers—those who have never heard of the editors out there on the frontier without the light of his presence— Rome Dally Herald. / HE IS CONTENT WITH ~ . "THE PEOPLE.” Again the parties are being led out of bondage to the spoiler. The con trast was scarcely more sharply drawn between Moses and Pharaoh—between John and Pilate. Here Is the hand of the people to John Temple Graves, the new prophet. Call It Populism or what you may. It Is genuine patriotism—the real broth erhood. The nation will now bound ahead—In wealth, science, education and the development of the race—as never before. There It some Populism In It. Between Bryan and Roosevelt they have It all, but call It American Ism, If you please—If It Is more tune ful. The people are marching forward, and with such leaders party organiza tions can no longer obstruct.—Joliet (III.) Dally News, AN APPEAL FOR THE KINGSTON GRAVES. To the Editor of The Georgian: Knowing the warm Southern splr!'. that exists In you. 1 desire to call your attention to a paragraph I saw a few days ago In one of our Atlanta papers, stating It as a tact that there was a town within the state of Georgia that contained the burying ground In which there were sixty or more graves of Confederate soldiers, without a head stone or any mark to show whom they were or from where. I* It not a dis grace to the state of Georgia and her rltlsens that such a thing should exist? That after forty-two years, with all the wealth and money that has been spent by the state for various purpose*, she has not seen fit to care for her heroes of the Civil war. burled upon her soil? Take thle up end see with your mighty hand and power of your paper that every grave within the state unknown and unmarked ehould have the attention It deserve* from the fa. there, mothers, eons and daughter* the heroes of the Civil war. Yours respectfully. SERGEANT MALCOLM M'NEILL, Forrest Cavalry, Eighteen Mlee, Reg. tie*. These bond* were Issued to pay for stock of the Central Railroad ot New Jersey, which was bought by the Reading company, and the stock pur. chased together with some other col> lateral woe pledged to secure the col lateral trust bonds. Because thle etock was bought at 21*0 per share, a price which seemed high at the time, the cry of overcapitalisation was heard when the bonds were issued. Central Railroad of New Jersey shares are now worth about 2186 a share, and they sold '12 per share. creased so that the Reading derives an Income from the shares after paying the Interest on the bonds. Considering the value of the assets of the Central Railroad of New Jersey. Us large earn ing power and the high market value of Its shares, who can truthfully cay that there Is any water In the Reading-Jer sey Central collateral trust bond*? ' they are but a type of similar 1 i sold by many other companies. Open Until 11 Tonight And ready to completely outfit you in stylish, dependable ap parel. Come in and choose a new suit from our Hart, Schaff- ner & Marx and Rogers, Peet & Co. lines. Sew Shirts We can’t say enough about this shirt stock to make* you appreciate its immensity and its excellence. Come and see it. Manhattan shirts—$1.50 to $3 50; other shirts—$1 to $3.50. Ties and Sox See the smart new patterns in 50-cent ties—silk and wash able fabrics. And a great stock of new light-weight fancy sox—25c to $1.00. Best Hat Styles Here You can’t go wrong if you come here for the new/hat, for only right sorts of hats are here. ’ Stetsons at $3 to $6; Miller hats at $5; and advance show ings of Panamas and straws. Daniel Bros. Co. L. J. DANIEL, President. 45-47-49 Peachtree—Opposite Walton St. / J2, 3 S & 7 F 0. <3 A COMPEL. SUCCESS — By Attending— The Dixie Business College, Atlanta, Ga. YOUNG PEOPLE, in these days, cannot succeed in BUSINESS unless skilled in Bookkeeping or shorthand. BUSINESS MEN, in these days, refuse to employ those who constantly need instruction in their duties. THE THOROUGHLY TRAINED BOOKKEEPER AND STENOGRAPHER GETS THE JOB AND KEEPS IT INSURE CERTAIN AND RAPID PROMOTION BY TAKING OUR UP-TO-THE-MINUTE COURSES IN BOOKKEEPING, SHORTHAND AND TOUCH TYPEWRITING, BANKING, ETC. Which Are Thoroughly Taught by Thoroughly Trained, EXPERIENCED TEACHERS at The School For Thoroughness. (Corner Peachtree and Marietta Sts.) ONE HUNDRED STUDENTS ENROLLED THE FIRST FOUR MONTHS IN HISTORY OF SCHOOL. THE DEMAND FOR “DIXIE” BOOKKEEPERS AND STENOGRAPHERS WAY AHEAD OF THE SUPPLY. DIXIE BUSINESS COLLEGE GRADUATES RECOGNIZED AS THE MOST HIGHLY TRAINED IN THE STATE. SCHOOL ELEGANTLY EQUIPPED; BEAUTIFULLY LIGHTED, CENTRALLY LOCATED. EVERY STUDENT RECEIVES THOROUGH INDIVIDUAL INSTRUCTION AND ATTENTION. WRITE FOR HANDSOME CATALOG AND SPECIAL RATES TO H. L. Bridges or Bernard C. Ansted, Proprietors. HEARD COL. GRAVES AI WASHINGTON, Gft, Auditorium Packed to Its Capacity When the At lantan Appeared. tors of the Confederacy held approprl ate memorial exercise* at the city cemetery here yesterday. The address of the occasion was made by Rev. S. Harris and short talks were made by a number of the old surviving Con federates who were present. The graves of those who are burled at the city cemetery were decorated with flowers. Special to The Georgian. Washington, Ga, April 27.—The Me morial day exercises held In Washing ton yesterday afternoon, were con ceded to be among the moet Inter esting ever presented on a similar oc casion and the crowd In Washington to hear the address of Hon. John Tem ple Graves, of Atlanta, could not be accommodated by tho large auditorium In which the exerclees were conducted. All the etoree closed thetr doors from 12 o'clock for the remainder of the day In honor of the occasion. Editor Graves reached Washington at 1 o'clock from Greensboro, where he de livered an address In the morning at 10 o'clock. The exercises which were under the direction of the Last Cabinet Chap ter of the Daughters of the Confederacy were commenced at 2 o’clock with the •ong. "I Am.An Old Time Confederate," which was sung by the veterans. Mr. Graves commenced speaking at 2:16 and for nearly an hour entertained one of the largest audiences that hns as sembled In the court house auditorium. Editor Graves left Washington at o'clock,, to be present tn Thomson at 8 o'clock Friday night, where he de livered his third address In one day. CROWD WA8 TOO LARGE FOR THE AUDITORIUM Oreensboro, Ga„ April 27.—Hon. John Temple Graves addressed the largest audience ever assembled In Greens boro yesterday, the occasion being Me morial exercises. Bo great was the crowd that no auditorium could be found In the city largo enough and Mr. Graves was compelled to epesk In the open air from the steps of the court house. Mr. Graves was at his best end thrilled his large audience by hie matchless eloquence. He was Intro, duced by Hon. J. B. Prose 4s "the sliver tongued orator of the United States.” After the address, hundreds of the old veterans, as well as the ladles, rushed forward to shake hands with Mr. Grave*. For twenty minutes he held a moet enthusiastic reception. Mr. Graves left hero for Washington, where lie delivered a memorial address In the afternoon . Veterans’ Gravas Decorated. S-ieclal to The Georgian. * Buford, Ga., April 27.—The Daugh- WOMAN SHOOTS HUSBAND AT RACES 'Imltco yesterday. Mrs. Nina Kins shot Wllllnm Dunn, a betting commissioner, whose home Is understood to She asld aha was his wlfo. Will Locate In Brunswick, Special to The Georgian. Bruniwlck, Ga., April 27.—The large cigar factory which Is now located at Jesup, will be removed to this city as soon as the change can be brought about. The factory will have a month ly pay roll of 22,000. No bad after effects from drinking all you want ot POSTUM FOOD COFFEE ‘‘There’s a Reason.” WMimMHnmwiai 1 GUATEMALAN EXILES PLAN NEW REGIME Mexico City, April 27.—It le rumored that another revolution Is Imminent In Guatemala, and If It Is successful the Guatemalan exllea In Mexico ond Central America expect to organize In this city a provisional government for Guatemala. LIE IS PASSED IN U. S. SUPREME COURT Washington, April 27.—In summing up the Herrmann case yesterday before the United State* supreme court the lie was passed between District Attor ney Baker and Attorney Worthington. The latter redtnted an alleged Insinua tion. HAD OPEN KNIFE FOR POLICEMAN P. E. Andrews, a mill foreman who lives at <22 South Pryor street, went home with too much whisky on board Friday at noon and threw all the bed clothing down stairs. When Call Offi ce™ Luck and Coker answered a call from Mrs. Andrews, they found an open knife on the bureau, which looked dan gerous. Mre. Andrews aald the knife had been Intended for the "first police man who cam* In." Andrew* waa locked up at the police station. 00009000000000000000000000 O O 0 8TUDENTS TIE UP O O CONTRARY JUDGES. O O O O Alton, III., April 27.—Having O O decided In favor of the aopho- O O mores In an oratorical test at O O Hhortllff College, Profeeoor M. O O Mngun and E. if. Day, two of the O O three Judges, were seised by the O O freshmen, tied on the campus and O O left there until this morning. O 0OOOOOOOOOOOOOOOOOQOOOOOOO ROLL OF THE DRUM GIVES YOUTH TO VETS Continued from Page One. fifteen hundred of them In line. That Atlanta has so many of the younger generation In her borden was a fact unknown to many who saw the little fellow* marching with the dignity of true soldiers In the long line of the parade Friday afternoon. Three Generations. As keeping perfect step to the music and with their long lines held In almost perfection, they passed the Confederate soldlen -1 n review, many expressions of praise were heard on evsry side and repeated cheen burst from the throats of the old veterans. To Dr. Toepel, physical director of the grammar schools, and who ha* taken on active Interest In the preparation of the chil dren for participation tn the parade, le due the wonderful showing they made Friday afternoon. But not only did the appearance of the children prove Inspiring and Im pressive, but the whole parade elicited applause and expressions of surprise and satisfaction from all who witnessed it. At Oakland, where the exercise* were held, one of the largest crowd* which ever assembled on a similar oc casion was present. Sol even the par- cloudy condition and the threat- rain served to keep the people away, and for hours before the head of the parade filed between the massive gate posts of the cemetery great throngs of people crowded the spacious area on the Inside. At Oakland Cemetery. The speakers' stand waa prepared upon the base of the monument to the Confederate dead. Chairs were placed on either side of the stand for the use of the president and ladlea ot the Memorial Association and other* who were to taka part In the exercises. Around the bass of the monument an Incloied space waa reserved for the Veterans of the Confederacy. After a selection rendered by Wede- IE III BUS: MUSICIANS EVE The Love Family Awakened Barely in Time. The family of H. Love, member* of the well known Love band of musl- clans, had a narrow escape from burn. Ing Saturday morning at 4 o'clock le fir* that almost completely de stroyed their home, a two-story from* dwelling at If Highland avenue. The family was awakened by neigh bors after the flames had gained greal headway and when the roof was al most ready to fall In. Tho frightened musicians rushed through thick vol umes of smoke Into the street and had time to ears only a few of (heir ef fects. By the time the firemen arrived os the scene, the house was almost de stroyed, a* the blase had been burn ing for some time before discovered. The fire le supposed to have started in tht kitchen. irealdent of the local chapter daughters of the Confederacy, si chap Confeai nounced that the crosee* of honor could not be delivered on account of the failure of the factory to supply them at the proper time. Grand Mi Joseph F. Bur time. Grand Marahal urke then Introduced the orator or the occasion, Hon. John T. Bolfeultlet, of Macon. Address of the Day. Mr. Bolfeulllet’i address waa deliv ered In the characteristic style of the eloquent Georgian that he. Is. With a fund of adjectives scarcely paralleled he paid glowing tribute to the women of the Bouth -who, during the dark days of bloodshed and carnage and the atilt darker daya of the reconstruction riora to beat the sword Into plowshares and to build up th* new South from the ashes of the old. In Inspiring colors he painted th* picture of the incomparable Lee, dauntless and victorious In the bloody battles around Richmond, when h« fought with tho ferocity of the lion al bay and hurled back, crushed and broken, th* attacking forces of McClel. Ian. lie pictured the redoubtable Jock- son, as he recklessly rods at the head of his column and with unparalleled daring attacked whole armies with but a handful of men. But tribute was not only pal<j the leaden of the famous conflict by the speaker. With eloquent tongue he sans th* p/alses of the men who bore the ark of the Confederacy upon the polnte of their bayonets and whose quick and daring execution of the orders of thelt leaden made possible the longest struggle against overwhelming oddi that history record* The address of Mr. Bolfeulltet wsi frequently applauded and was one ol the ablest *v*r beard In Atlanta. The. exerclees were concluded with th* song, "God Be With You TIM Wt period. Inspired and encouraged the Uili-i, , defeated and all but disheartened war- “®® 1 Again, after which the bene- -* ' **' diction wa* pronounced. After the salute of twenty-one wa* fired, taps was sounded raves of the sleeping soldlen ay l ay ,’llaon. of the Governor’s Horn Guard. Aged Negro Found Dead. Special to The Georgian. Griffin, Oa., April 27.—Mack Wil liam*. an ante-bellum negro about 20 year* ot age, was found dead In a shal low branch In the northeast corner of th* county. 4% Interest Compounded, Allowed In Our SAVINGS DEPARTMENT On and After January 1,1907 TH E NEAL BANK E. H. THORNTON, President. W. F. MANRY, H. C: CALDWELL, F. M. BERRY, Vice President. Cashier. Ass't Cashier.