page_title: Charles Moran (railroad executive)
section_title: Moran's policy changes
hierarchical_section_title: Charles Moran (railroad executive) / Work / Moran's policy changes
caption_attribution_description: English: Erie Railroad, financial conditions of the Company, 1857
context_page_description: Charles Moran was an American business man and president of the Erie Railroad from 1857 to 1859.
context_section_description: Early in his incumbency, President Moran demonstrated that his policy was to be radically different in the management of the Company's affairs from that of any of his predecessors. It had been the custom, as a bid for new business and an inducement to retain old, to issue free passes to drovers who accompanied their cattle to market on the stock trains, and to "freighters." who controlled produce shipments in those days. There were about 160 persons receiving these free tickets, and the issuing of them had been regarded as good business policy by all managements up to the Moran control. Moran did not believe it was a sound business principle, and he abolished the free pass system at once. He also dispensed with agencies, runners, advertisements, and all such methods of increasing the Company's business.
  Money was necessary to carry forward the improvements the Company had then in hand, but which were being delayed by lack of funds, so a scheme for a fourth mortgage loan was announced early in August 1857. It was proposed to raise $3,000,000 by creating a stock for $6,000,000, half to be paid in cash and half in the unsecured bonds of the Company. The object of the loan was to fund the debt of the Company, and to obtain means to continue the construction of the Bergen tunnel, the depots, wharves and other improvements of the Long Dock property. It was calculated that the debt of the Company would be increased but about $1,000,000 by this plan.
  It was a discouraging time for negotiating loans, however, even on the most approved security, for it was at the height of the panic of 1857 when banks were failing by the score, and the oldest business houses were trembling on the verge of bankruptcy; but President Moran and his associates went to work- in earnest to place the new bonds. The unsecured bonds of the Company were low in the market being then quoted at about thirty-five and the terms of the new issue were favorable, but investors ignored it.
  A meeting of the stock and bondholders held at No. 13 Broad Street, New York, September 23, 1857. For the purpose of inducing them to subscribe for the new loan. President Moran made an address which is to-day a graphic and in some respects an amusing – exhibit of the Company's situation and tribulations in that critical year. He began by presenting a statement of the financial condition of the Company (see image).
caption: Erie financial conditions, 1857
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