The Helena independent. [volume] (Helena, Mont.) 1875-1943, 1892-02-10
THE FINANCIAL REVIEW.
Business During the Last Week
Quist, Irregular and Toward
Lower Prices.

Quiet, irregular ana loWar0
Lower Prices.
A General Conviction That Prices
Must Go Higher, Possibly
Much Higher.
Necessary Result of Extraordinary Ease
in the Loan Market-The Situation
Mt Homc-Infcrences.
New York, Feb. 9.-lSpecial. THE las
circular issued by the banking house OF
Henry Clews Il CO.. IL. ID and 10 Broao
street. and IS Wall street, says: During
the past week, the course of business AZ the
stock exchange has been quiet, irreRula'
and. on the whole, towards " prices
The market has, for the moment. fallen III
to the hands of the professional traders,
AMONG whom. AS usual, tho "bear" temper
n~redominatos. The outside public and the
larger bull operators seem willing that mat
tiers should take this course for a while.
,rhev have realized handsome profits ON the
January advance; and, i'll the absence
of snv very pronounced "bulr' feellnR at
the present stage. they deem it good tactics
To Withhold their support and permit the
..hears'' to knock several points OH prices
and then take in new lines for a fresh ad-
vance, Under these circumstances, the
..hears' are allowed a fair chance at selling
down the market. and both sides may IN
turn have an opportunity for q profitable
RIM of speculatiou; which, as the temper OF
the market now stands. is perhaps the most
wbolesome course affairs could take; al
though it may be attended with a tran
silently upwelcome quiet among the COM
mission houses.
There ia no sufficient reason for constru-
ing this change Of temper as meaning that
the speculative feeling has collapsed, or
that prices are destined to any important
reaction. It means simply that the spirit
of speculation. at the moment, is conserva-
tive. and that tine ''bulr' leaders, appreciate
ing this, deem it wiser to encourage On I'M
dulnting advance, with its ups and Gowns,
rather than to force prices IN the direction
Of q straight upward line. In the mean
time there is no surrender Of the general
conviction that prices must ultimately go
higher and possibly much higher; but 1t is
conceded that months may elapse before
that tendency eliminates; and, among
speculative leaders. it is preferred that the
campaign should be so prolonged.
The extraordinary ease in the loan mar
ket can hardly possibly fail to produce an
active, if not excited, speculation. When
an extreme ease in money comes concur
rently with a general depression in business
it may fail to develop speculation; but
when-asis the case at presents happsna
along with large crops and a healthy state
of affairs at large, 1T almost inevitably car
ries along with it a general rise in the value
of securities as we'll as OF other invest
ments. There are two especially potent
monetary influences at present acting as a
lever on the market. In the first place, the
farmers are d~evoting a large amount OF the
proceeds of their abundant crops to the
liquidation of their farm loans; which has
the double effect of creating Il fresh demand
for investments from ths holders OF the
l%iuuidated mortgages, and of causing g
large accumulation of currency at this and
other eastern centers. This movement is
one of the main causes of the continued
extraordinary influx of money from
accumulation of large floating balance.
at this and the other seaboard cities is
producing a depression of the rate of inter
est on call loans which is appalling to the
banks and to other financial institutions;
and that induces a demand for the divi-
dend-paying stocks which amounts to the
withdrawal of an important amount of Al
oL-1,oa v~r %hn r,orLof nhnoo UUifhHtAu
ais nave been. to some extant, Offset by the
return of securities from Europe; but
Symphonic seem to indicate that the reflu1
from London has about ceased-a proba-
bility which is strengthened by the low
rate of 1M14 per cent for call money or
that market. Influences of this character
however. are not apt to create sudden OF
sensational advances in prices. They ap-
peal mainly to careful financial managers
who make their investments gradually al
their funds accumulate and avoid a show
of buying; and. for this reason, these fac
tors may not be expected to produce theil
full effect on prices until a later stage ha:
been reached. Sagacious operators have
their eve upon the ultimate outcome o
these causes. and therefore are immovabl,
''bullish;'' but, during the interim, they
are willing to make short turns for mloder.
ate profits.
The bears advance as their chief argu.
ment against an upward movement il
prices that, the world over, affairs are in
r%eactionary condition, which. they say, i
attended with a commercial depression
which is incompatible with a "bull' mar
ket for securities. There is a ssmblance o
truth in this, bat nothing more. The rea
soning would be sound if the depression t.
which it refers was the consequence o
panic and its usual attendant widespread
bankruptcy. 1t is true that the Barring sus
pension and its surrounding circumstance
were a sharp shock to business in all part
of the world, but there Was nothing lik
the contraction of credit and the losse
from failures that usually attend the grea
periodic panlcs. 1t was a shock, but littl
more, and its effect has been principally
create conservatism, to check really unsoun
enterprise. and to eliminate wild spscula
ton at n few diseased spots in Sout
America, rather than to produce a geners
violent disorganization of trade n finance
This amounts to a much less serious reac
tion than that which ordinarily succeeds
general panic. It's effects are not only les
severe, but are also briefer in their du,
alton. There exists III Europe a contractio
of unsound business and speculation
which Is shown in the decrease of the com
merce of Great Britain and that of some C
the continental nations: but there ia non
OF the excessive caution that denies capt.;
or credit for meritorious undertaking
and when the rate o. interest falls to la
per cent, the holders of money are nc
likely to prefer to keep it idle rather tina
invest it in good securities or lend it upo
safe collaterals. 1t is therefore REASONABLE
to infer that such general Consequences
have followed the crisis of seventee
months ago may be expected TO yield earl
to the recuperative Influences, and X
signs arc not lacking that such recovery
already in steady proqress and will NAL