San Antonio daily light. [volume] (San Antonio, Tex.) 1886-1907, 1891-06-03
TIE MONEY MARKET.
Specially reported for the LIGHT by Hen
rv Claws e Co:

ry Views N w.
NEW YORK, June l, 1891.
The course of business on the stock
exchange still turns almost entirely
on the exports OF golu. AS foreshad-
awed in my last advices, the ship
men is have materially declined, hay
ing been about s. 5000 for the week,
compared with 100000 last week;
and although there is nard demand
for bills, the probability is that we
are almost at the end of the move
ment. At the moment, there are
considerable payments being made
against the recent specially large inn
ports of raw sugar, incident to the
repeal of the duty upon that article,
the receipts of which since March lst
exceed those for the same period of
last year by 100000 tons valued at
81, 500, 900.
The factor determining the future
course Of the foreign exchanges, how
ever, is less whether there is still
outstanding any important floating
Indebtedness against this country,
than what Europe is likely to do
under the increase of money that now
rests in its great banks? Within the
past two months, we have sent close
upon fifty millions of gold to Europe;
and, although the bank returns do
not show exactly where it all rests,
yet such large and sudden accession
to cash reserves cannot fail to
strengthen confidence in the foreign
money markets and produce an ex-
pansion of lending ability. Our
earlier shipments of gold went prin-
cipally to Russia; but within the last
two weeks, the bank of Engla has
increased its gold by SIT 500, 900 and
the bank of France by $1,000, 600
besides $3.50, 600 in silver. These
facts show that the requirements of
of Russia were satisfied some
time ago; and our subsequent
exports have gone mainly
towards recouping the banks of other
countries for their contributions to
Russia's wants. The effect Of these
cash gains by the Bank of England is
apparent in rise in the reserve from
SO. SO per cent on the 2lst instant to
40. go per cent on the 2Sth, while the
London rate for money in the open
market is now per cent against 3
per cent two weeks ago. This wide
divergence between the present Bank
rate and the open market quotation
foreshadows an early return TO 4 per
cent rate by the Bank of England.
There is difference of 2 IL per cent
between the current market rate at
London and what is paid for short
time loans at New York; and under
those circumstances London bankers
are likely to allow balances to rest
here for employment rather than de-
mand their remittance in gold and
thereby force the rate of interest still
lower. The situation has thus
reached stage at which it is both
protective and profitable to discour-
age further remittances of gold from
New York.
The probability of London finan-
cie1s taking this course is strength
ened by the fact that Russia may be
expected to soon disburse her accu-
mulated gold in the payment OF i'm.
peIia loans now maturing; and there
is q strong motive for her taking that
course as a means of promoting the
confidence that is needful to prepare
the way for the loan which the Czar's
government has contracted for with
the Rothschild syndicate. We have
therefore the doubl fact that the Eu-
ropean money markets are already
reacting sharply toward ease, and
that this tendency will be soon rein
forced by the redistribution of the
gold Russia has accumulated in tran
sient hoard.
Under these circumstances, it be-
comes not SO much a question whether
Europe will want more of our gold,
but rather whether it may not find it
necessary to encourage the refiuX of
our money In order to find use for it.
Such a situation as this suggests a
probability that European bankers
may direct their agents here to lend
more or less freely in advance Of the
anticipated return of gold in payment
for our crops. 1t seems reasonab BILE,
therefore, to expect an early
turn of the foreign exchanges in our
favor. In the meantime, the rates of
exchange at all interior points are at
so high a premium on New York as
to suggest the continuance of free re-
ceipts of currency by our banks. II
is true that the receipts have beeen
heavy during late weeks, the total net
cash remittance arriving here from
the interior since the middle of April
having amounted to about $50, 000, 900
which, compared with the refiux of
rcent years, nigh 1t seem to sug-
gest some probability that these re-
ceipts may soon decline. But it not
to be overlooked that, during last
fall, the treasury let out some $40,
600 900 of cash, which was drained off
into the interior as fast as it came out,
besides which the treasury has since
that time issued nearly $4,000, 900 of