St. Paul

On June 1, the $48,000,000 of the 4% bonds of the Chicago, Milwaukee & St. Paul R. R. mature and are due for payment. The St. Paul cannot hope to refund this issue by going direct to its shippers as the New Haven has recently done, and must therefore look to its bankers-- Kuhn, Loeb & Co. and the National City Bank. Whether the road is due for a receivership this spring is unknown in financial circles. But the drastic decline in St. Paul stocks and junior bonds indicates Wall Street's opinion that all is not well with the great northwest carrier.

The fundamental trouble with the St. Paul is overcompetition from the Great Northern, the Northern Pacific, the Canadian transcontinental lines and shipping lines through the Panama Canal. The northwest territory is overbuilt with railroads in proportion to its traffic needs; and St. Paul, as the latest comer, has fared worst in competition. President Harry E. Byram naturally is preserving as cheerful a countenance concerning the approaching bond maturity date as he can; and even yet the bonds may be extended or exchanged in some way so as to avoid a receivership. But, since the immediate crisis is financial, the real future of the St. Paul is probably in the hands of two bankers, Jerome J. Hanauer of Kuhn, Loeb & Co., and President Charles E. Mitchell of the National City Bank of New York. Neither very naturally will talk for publication, and whether they will undertake to fund the aggravating loan of $48,000,000 can only be conjectured, But that they have hitherto proved reluctant to do so is a fair deduction from their waiting policy during a period when new security offerings have been readily subscribed, and when rising money rates have foreshadowed a temporary slump in prices for seasoned bond issues.

The St. Paul is not only the largest U. S. Railroad at present in financial difficulties, but one of the largest systems in the country.