Fifty years in Wall Street
Administration, we gained on an average more than ten billions each
year, the exchanges having gone up from $51,935,651,733 in 1896, to the
surprising sum of $92,037,588,818 in 1900. From 1888 to 1892 during a
Republican Administration, we increased our exports $317,787,505,
reaching the then gratifying figure of $1,015,732,011. From 1892 to
1896, during a Democratic Administration, our exports decreased by
$152,531,524, falling from $1,015,732,011 to $863,200,487. From 1896
down to June 30, 1900, with two months estimated, during McKinley’s
Administration, our exports have gone up from $863,200,487 in 1896, to
$1,400,000,000, gaining $537,000,000, or nearly doubling; and of this
vast export of $1,400,000,000 more than $400,000,000 are manufactured
goods, and would require in their production more than a million of
American mechanics.
From the fall of 1888 to the fall of 1892, during a Republican
Administration, national banks gained in resources $694,400,000, going
from $2,815,700,000 to $3,510,100,000. From the fall of 1892 to the fall
of 1896, during a Democratic Administration, the national banks lost in
resources $346,500,000, going down from $3,510,100,000 to
$3,263,600,000. From the fall of 1896 to April 26, 1900, during
McKinley’s Administration, the national banks have gained in resources
$1,548,356,000, going up from $3,263,600,000 to $4,811,956,000. The
increase in both Republican periods was constant and gradual throughout,
demonstrating, as has been well said, the influence and power of
far-reaching politics which alone can bring about uniform and universal
prosperity worthy the genius of the American people. The Republican
party turned over the Government to the Democrats in March, 1893, with a
bonded debt of only $585,029,330, and this was increased to
$847,365,130, in times of peace. For the purpose of prosecuting the war
the debt was increased in 1898 by $200,000,000, and now stands at
$1,046,048,750, less such an amount of the twenty-five millions of 2 per
cent. bonds as the Secretary of the Treasury may have already redeemed.
During the last four years of Democratic administration, $201,003,808 of
gold was exported; while during the first three years of the recent
Administration, or down to June 30, 1899, we imported $201,071,000,
making a difference in favor of Republican politics of $402,074,808.
Look, too, at the per capita circulation in the United States. In 1802,
it was $5.00; in 1845, $9.00; in 1873, $15.85; in 1892, $24.40; in 1900,
$26.77.
As President McKinley pointed out in his message, our foreign trade for
the fiscal year of 1900 showed a remarkable record. The total of imports
and exports for the first time in the history of the country exceeded
two billions of dollars. The exports are greater than they have ever
been before, the total for the fiscal year 1900 being $1,394,483,082, an
increase over 1899 of $167,459,780, an increase over 1898 of
$163,000,752, over 1897 of $343,489,526, and greater than 1896 by
$511,876,144. The growth of manufactures in the United States is
evidenced by the fact that exports of manufactured products largely
exceed those of any previous year, their value for 1900 being
$433,851,756, against $339,592,146 in 1899, an increase of 28%.
Agricultural products were also exported during 1900 in greater volume
than in 1899, the total for the year being $835,858,123, against
$784,776,142 in 1899.
The imports for the year amounted to $849,941,184, an increase over 1899
of $152,792,695. The increase is largely in materials for manufacture,
and is in response to the rapid development of manufacturing in the
United States. While there was imported for use in manufactures in 1900
material to the value of $79,768,972 in excess of 1899, it is reassuring
to observe that there is a tendency toward decrease in the importation
of articles manufactured ready for consumption, which in 1900 formed
15.17 per cent. of the total imports against 15.54 per cent. in 1899 and
21.09 per cent. in 1896.
The election of November, 1900, stamped out of the minds of the people
all fear that any sort of governmental policy in any way inimical to the
finances or business or prosperity of the country may be adopted. A very
great factor in our future development, which our people are soon to
discover, will appear in the building up of the ports of trade on the
Pacific Coast, which will be so extensive and rapid in progress that the
Atlantic ports will before long begin to feel the competition of the
Western coast of our country. Our grasp of the Philippine Islands, and
the foothold in trade and greater share of confidence in our
disinterestedness as regards territorial encroachment which is fast
gaining in the Chinese Empire, will finally consummate the preparations
for as great business and prosperity for the Pacific coast States as
have heretofore been enjoyed by those of the Atlantic coast. Soon a part
of the trade and commerce of the Eastern States will be brought into
competition with that of the great Pacific coast, insomuch that it will
appear that indeed “Westward the star of empire takes its way.” It is
the foresight of such change in the Pacific States that has helped
produce such a pronounced electoral result.
Our country is now passing through a rapid growth of progress and power
and prestige which will soon place her in the leadership of the nations,
with every means necessary for extending civilization, enlightenment,
commerce and better government over the world. We have come to the time
when we must take up the mighty work of further cultivating and
improving the condition of mankind, and we will continue this great work
until our labors shall have brought to pass better conditions of
government, co-ordination of interests, education, and peace and good
will among the nations of the earth. In the progress of civilization
since the dawn of the Christian era, the momentous task of leadership
has devolved first upon Rome, then upon Spain, then upon England. It
seems to have been reserved for the “Young Giant of the West” to
complete the tasks undertaken, and assemble into one great community of
interest vast national forces which have been the growth of centuries.
In due time we shall no doubt finish the work and bring peace and good
will to men in every part of the world and prepare men everywhere to
turn the spear into a pruning hook, the sword into a ploughshare and to
give freedom and protection and prosperity to all sorts and conditions
of men, and put an end to strife between the nations. We believe that
such is the great office to which we have been called, and that our
functions as the leading nation of the world have already begun.
ALL THE PRECEDING PAGES WERE
WRITTEN YEARS AGO, AND WHAT FOLLOWS
BRINGS THE WORK UP TO THE
DATE OF THIS ISSUE, MARCH 31ST, 1908.
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CHAPTER LXIV.
MY CHRISTMAS ADDRESS TO CUSTOMERS DEC. 24,
1906.
You can now realize why we have for so long a period had a congested
stock market. It started by the accumulation of Union Pacific by
comparatively few people, the purchases being commenced in 1903, the
panic year, when the price dipped to 65. By the time the stock touched
100 the accumulation was complete. Then the manipulation was begun for
its advance to 190, at which time the ten per cent. dividend was
declared, since which the process of distribution has been going on. St.
Paul, Northern Pacific, and Great Northern have gone through a similar
process. Prior to the declaration of the increased stock issues by these
companies, the larger part of the old stock had been bought up by the
inside knowing ones, after which the new issues were announced to the
public. The profit to the holders of these stocks can be measured by the
market value of the rights. Now we all know what the large holdings of
these stocks meant. The inside magnates having nearly all of them, the
outsiders were left out in the cold, and were consequently in the dark;
but now the light of day flashes over the situation. You are asked to
buy the rights which represent insiders’ profits, all of which is water
pure and simple. The accumulation of stocks has now ceased and
distribution is under way, and that is why the market has this present
fit of liquidation, which must go on until completed. Then the situation
will have righted itself legitimately, and not until then. Remember what
I tell you: that the accumulation of stock as I have described has
produced the present congested money market, and the unlocking of the
former will, after a short time, unlock the other; then all will be well
again. The present turbulent waves will pass over without many
shipwrecks, and then will come calm weather and a smooth sea. Patience
is a great virtue; exercise it, and wait for bottom; then get in and get
rich.
Gentlemen, this is my Christmas greeting to you. You all have my best
wishes for a happy and prosperous New Year.
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CHAPTER LXV.
EDWARD H. HARRIMAN.
Edward H. Harriman was born on Long Island in 1848. His father was a
clergyman, and the family in poor circumstances. At the age of fourteen
he left school, and began his business career in a Wall Street house. Of
an aggressive and masterful character, with a great capacity for hard
work and the ability to master every detail, he rapidly forged ahead. At
eighteen he became partner in a brokerage house; at twenty-two bought a
seat on the New York Stock Exchange. In 1883 he was chosen a director of
the Illinois Central Railroad Company, and four years later, when he
became its vice president, he retired from the brokerage business,
having amassed what was then considered a comfortable fortune. For a
time, while President Fish was abroad, Mr. Harriman was acting president
of the Illinois Central, and promptly put into execution his idea that
the way to make a road pay was to put it in the best of physical
condition, and thus attract traffic by the ability to handle it, rather
than by cutting rates. This policy afterwards brought the Union Pacific
up from a financial and physical wreck in 1893 to the most aggressive
and progressive railroad corporation of the day, operating, together
with the Southern Pacific, over 15,000 miles of road, besides
controlling the Illinois Central, Chicago & Alton, and St. Joseph &
Grand Island Railroad companies and the Pacific Mail Steamship Company,
and owning large interests in the Baltimore & Ohio, New York Central,
Atchison, Chicago & Northwestern, and Chicago, Milwaukee & St. Paul
roads. Mr. Harriman and his associates were defeated in an attempt to
obtain control of the Northern Pacific in 1901, but the Union Pacific
system benefited by this defeat, it is estimated, by about $60,000,000.
The purchase of Northern Pacific in the open market forced the price of
its stock up to $1,000 per share on May 9, 1901, causing the memorable
panic of that date.
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CHAPTER LXVI.
THE UPS AND DOWNS OF WALL STREET.
ILLUSTRATED BY PERSONAL REMINISCENCES OF ITS LEADERS.
The mutations and vicissitudes, the ups and downs, of Wall Street can be
best illustrated by sketches, from life, of the career and experience of
its leading operators, who have often, though not generally, gone up
like a rocket and come down like a stick.