The Helena independent. [volume] (Helena, Mont.) 1875-1943, 1891-06-03
ON THE EXPORTS Of GOLD
Depends Very Largely the Course Of
Business on the Stock
Exchange.
European Banks Have About All
They Will Need for Quite
"a While.
Requirements of Russia Satisfed-The Re-
turn Tide Should Set in Before
Very Long.
BANKING House OF

Especial Correspondence of The INDEPENDENT.
NEW York, May 29.-The course of bust
ness on the stock exchange still turns al
most entirely on the exports of gold. As
foreshadowed in my last advices, the ship
ments have materially declined, having
been about 81, 900, 600 for the week, COM
pared with $1,000 600 last week; and al
though there is a sharp demand for bills,
the probability is that we are almost at the
end OF the movement. At the moment,
there are considerable pay ments being made
against the recent specially large imports
of raw sugar, incident to the repeal of the
duty upon that article, the receipts of which
since March l exceed those for the same
period of last year by 1907 600 tons valued
ut 81, 800, 900.
Th factor determining the future course
of the foreign exchanges, however, ia less
whether there is still outstanding any inn
portant floating indebtedness against this
country, than what Europe is likely to do
under tho increase of money that now
rests in it's great banks? Within tho pnst
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 a large and sudden &C.
Ccablou ~ GdsA eboIfSs ChkIuOb 1dlt 10
strengthen confidence in the foreign money
markets and produce an expansion of lend
ing ability. Our earlier shipments of gold
went principally to Russia; but, within the
last two weeks, the Bank of England has
increased its gold by $17,5O 600 and the
Bank of France by S., 000,0 900, besides S.
10000 in silver. These facts show that the
requirements of Russia were satisfied some
time ago. and our subsequent exports have
gone mainly towards recouping the banks
of other countries for their contribu-
tions to Russia's wants. The effect of
these cash gains by the bank of England Is
apparent in a rise i'll the reserve from 1898
per cent. on the 2lst instant to 1890 per |
cent. on the 2Sth, while the London rate for
money in the open market is now three per
cent. against five per cant two weeks ago.
This wide divergence between the present
bank rate and the open market quotation
1oresnadows an early return to a four por
cent. rate by the bank of England. There
is a difference of 212 per cent between the |
current market rate at London and what is
paid for shoit time loans Mt New York; and
under those circumstances London bank
ers are likely to allow balances to rest here
for employment rather than demand their
remittance in gold and thereby force the
rate of interest still lower. The situation
has thus reached a stage at which it is both
DTotSCtlS6 "ti pTtHbuLie TO ClSCOuraDe |
further Iemittances of gold from New York.
Tho probababllity o. London tinanciers
taking this course is strengthened by the
Ihct tnat Russia may be expected to coon
disburse her accumulated gold in the pay
ment of imperial loans now maturing; and
the G ia n strong motive for her taking that
course as a means of promoting the conf
denoe that is needful to prepare the way
for the loan which the czar's government +,
has contracted with the Rothschild syndi-
cate. We have therefore the double fact
that the European money markets ara al |
ready reacting sharply towards ease, and
that this tendency will soon be reinforced
by the redistribution of the gold Russia has
accumulated in transient hoard.
Under these circumstances, it becomes
not 80 much II question whether Europe will |
want mora of our gold, but rather whether |
it may not fnd it necessary to encourage
the retiux of our money in order to find uss
for 1T. 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 tho anticipated return
of gold in payment for our crops. 1t seems |
reasonable, 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 Mt 30 high a premium
on New York ~ to suggest the continuance
of free receipts of currency by o2r banks.
1t is true that the receipts have been heavy
during late weeks, the total not cash re-
mlttances arriving here from the Interior
since the middle of April having amounted
to about $780, 1000; which, compared with
the refluK OF recent years, might seem to
suggest some probability that these receipts
may soon decline. But it is not to be over
looked that during Last fall the treasury
let out some 81 100000 of cash, which was
drained of into the interior az fast as it
came out, besides which the treasury has
since that time issued nearly $780, 900, 900 of
new silver notes. 1t hardly seems uureas-
enable to expect that with a comparatively
quiet condition of general trade throughout
tho country this immense initiation of the
Gu rency should be followed by a specially j
liberal spring and summer return of money
to this center. Coupling his probability
with the prospect Of favorable influences
from Europe both before and after the har-
vest. it would not seem that Wall street
has any serious cause for apprehension
about the coarse of the money market from
this time forward. still, conservative OPP
orators will wisely take into account
thut the loan market has been drained
to a point of constituencies. and that any
thing short OF the immediate cessation OF
gold exports might produce u %stringency in
money calculated to precipitate n decline in
securities; aud, for that reason, ! counsel