Fort Worth daily gazette. (Fort Worth, Tex.) 1882-1891, 1890-10-09
FINANCIAL.
A Reasonably Easy Money Market May
Be Expected the Rest of This Year.
Why the Market Fails TO Respond to Influences
Which Would Ordinarily Produce
Rise In Prices.
NEW YORK. Oct. 4. 1890.

NEW YORK., Oct. 4, 1899.
We have still to record an absence o
any marked response, in the larger
movements of Wall street, to the meas
ures of financial relief adopted by thu
| government. The increase of SIP ITO, 00t
in the surplus reserve shown by the bank
statement of last Saturday, demonstrate!
plainly that Secretary Window 5 last ex.
pedient fully succeeded in affordne
an ample measure of relief at the
And the effect is plain enough in pei
| cent rate for call loans and in THE
abundance of money offered on time
loans at 6 per cent and on discounts a
same rate. Nor is there any apparent
reason for expecting anything short of =
reasonably easy money market for the
remaining months OF this year. All
therefore, that could be mplished by
an easy money market is now within
reach; nor is it any evidence to the con-
trary that money has goue 10 the inter
ior in large volume during the past
week, for there are evidences of the be-
ginning of u return movement at certain
points.
But notwithstanding these advantages,
Wall street still lacks spirit, If not con-
iidence, and if the large iufintion-oS 4Ste
active circulation has inspired hope in
any direction, that feeling has NIT yet
assumed any definite expression, The
stock exchange shows no activity and no
fixed tendency. Large operators are
disposed TO wait for developments, and
business seems TO be drifting into the sort
of stagnancy that comes from the absence
of any clearly defined conditions calcu-
lated to afford basis for large ventures.
The slight fluctuations from day to day
follow the changing positions OF room
operators, and the outside interest np-
pears to be quite nominal. The high
rates of interest on time loans can hardly
be said TO check purchases for long
operations, for money eau be had i'll
large amounts on call ut 4 per cent. :,
with little prospect of the loans being
disturbed for some time 10 come.
1t therefore becomes necessary to look
deeper than surface conditions for the
causes of the comparative stagnancy of
the interests centering at the Stock Ex-
change. An examination into the sup
ply of securities awaiting buyers may
suggest some explanation of the situa-
ton. An illustrative parallel very di-
rectly to the point may be cited from the
tour years 1880 to 1888 inclusive During
that period, 80, l59 miles of railroad were
constructed, with the result of
IN increase of Sl,lS2 900, 600 in
the mortgage debts of the rail-
roads of the country. This increase IN
railroad property, which was at nearly
three times the rate of the growth of
population within the same period, had
the effect of abnormally increasing the
supply of securities seeking investors:
and hence the great decline IN stocks
and bonds that occurred in 1886 1t is
question deserving candid examination
whether we are now passing through u
similar situation; so far as respects rail-
road investments. During the four years
1886 to 1899 inclusive, the mileage of the
railroads was increased 80. 1925, with all
addition of 81 ,0G3 900 900 to the amount
of outstanding mortgate bonds.
Although, relatively, the increase of
mileage and of mortgage issues, within
the last four years, has not been quite so
great as was that of the previous period
referred to, yet it has been at double the
ratio of the increase in population. 1t Is
not unreasonable to assume, therefore,
that the creation of new sc uritles within
late years must have teen largely In ex-
cess of the absorbent capacity of invest
ors, and that consequently there is
heavy current over-supply of invest
ments, some carried on the market and
more not, but large portion awaiting
sale and which can be distributed only at
a low range of prices. It cannot be said
however, that the present situation ia
so decidedly unfavorable as that which
in the break down
of 1885; for the amount of bonds issued
during the last four years is not SO large
as that of the years 1880 to 1883; whilst
the population is now several millions
more and the wealth of the country
much greater than it was then; but do
not see how it can be denied that, with
these exceptions, the two situations are
identical and that we must consequently
look for solution of the present po-
sition of affairs in certain amount OF
liquidation. That solution seems 10 De
now coming gradually, and appears
likely to proceed and eliminate without
any severe disturbance; for apparently
hat is the way In which extreme move
meuts are in these days are adjusted.
This take TO be really the main factor
accounting for the stubborn inelasticity
of the market and its failure to respond
20 influences which would ordinarily pro-
luce a rise in prices. The market is con-
inualiy kept down by an uumanageable
surplus of securities, and prices drop dis
when the smallest meas
Ire of support is lost. Fortunately,
he general condition of trade is healthy
md there is nothing TO disturb
confidence in the stability of af-
airs outside Of Wall street; which
lets as an important check agninst
my serious declining tendency in Sc
,urities. But, ct the moment, the |
European branch of our field of invest
nent has become an element of weak |
Tess. The London money market verges
closely upon q condition of positive
tringeney. The Bank of England lost
Yearly fl 900 900 Of specie last week and |
he ratio of reserve fell from forty-four
o thirty-one, while the rate OF interest
n the open market rose to 81 per cent.
such condition suggests the pos
Utility of relief being sought in
he return of stocks to this |
ids with the double result of
N addition to the existing supply and |