OF THE UNIVERSITY WALL STREET AND THE COUNTRY I THE FUTURE OF UNDIGESTED SECURITIES THE perturbations to which prices have been subjected on the New York Stock Exchange during the past year have naturally caused revulsions of feeling among those who have suffered from them, and much questioning of the wisdom of some of the recent operations of prominent American financiers. It is a familiar aphorism that "Wall Street" is very popular in periods of ascending prices, and is very unpopular in periods of declining prices. The public often seem to forget that quotations in Wall Street are only the mirror of their own estimate of the value of securities, and that most financiers would be as well pleased as outsiders if they could warp this mirror to give the reflection of a constantly ascending value to the properties which they control. There are many lessons to be learned from recent experiences, one of the most obvious being that the outsider should not enter the stock market in the gambling spirit, but only for investment, and then only when he has made a careful study of values of properties and their earning power, and of the conditions which affect the market. The creation of industrial companies during the past five years and the ascending prices of their securities until within the past year have written a new chapter in the history of the world's effort to work out its economic destiny. It has afforded a new illustration of the law of the survival of the fittest. Practically every form of financial enterprise has had to go through the same birthpangs when it was a new and untried project; and only those features of it have survived which have been found to possess real economic value. It is usually those who initiate the new methods who take the greater risks. If their projects will not stand the test of competition, they carry down their projectors with them to disaster; if they succeed, they sometimes confer rich rewards upon the far-sighted and venturesome pioneer; but in the latter case they render a net economic service to the community. It is the experience through which the new methods of finance have passed, and that through which they are yet to pass, which is to determine whether they have in them elements of survival. The mechanism of modern finance has been devised piece by piece to meet the constantly growing demand for more efficient methods of giving mobility to capital. By mobility is meant facility for transferring capital promptly and without loss from one person to another. It was the use of money which primarily made possible the transfer of capital when trade began to emerge from the |