The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1897-08-09
HAVE CHARACTERIZED THE
MARKET.
BUT BEARS ARE CAUTIOUS.
ARE TAKING NO CHANCES OF
BEING CAUGHT TOO
SHORT.
GOOD REASONS FOR THE sLUMPs.
Market Yet Lacks Some of the EIe-
ments of Strength-Henry CIews'
Weekly Review.

NEW YORK, Aug. SIN his weekly
review of the financial situation Henry
Clews says:
We have had during the week a reaction,
being one of a series of halts which have
characterized the upward movement of the
last three months. These bounds and slumps
are symptomatic of the temper of the market
and of the kind of influences that are affect
ing it; and 1t may be we'll to understand their
cause. They do not imply any real distruSt
in the soundness of values, nor in the reality
OF the recovery in the general conditions that
determine prices, nor do they mean that there
is anywhere any settled misgivng as to the
prospect OF an ultimate still greater advance
in prices All this is taken for granted al
most everywhere; even the bears" are bears
only for the moment, and are extremely eau
tious about not letting their Shorts" run too
long. Why is it then that instead of a con-
tinuous rise, we have had a two or three
weeks of rise followed by a period Of real
ling and partial reaction? Why is the Wall
street weather fitful and gusty, instead of a
steady forcing breeze? The following factors
may be taken an answer:
u Because operators have not yet en-
tlreIy got rid of the habit of nervous eau
ton inspired by the disorders of the last four
years. ~ Because the situation, though one
OF healthy tendencies, is yet a very compli-
Gated one. Though we are visibly and surely
hndlng our way out of the arrangements that
set IN with 1893 yet many probiems-politi-
cal, financial, industrial and commercial-are
still demanding settlement, but are far from
having reached that point 81 Because al
though business at large is fast returning
towards normal activity, yet there is still
some m1sgiving as to what a revival of actiy-
1ty in al our Vast productive resources and in
all our manufacturing plants may mean. The
question remains to be settled by experience
whether we can fully depend upon finding
a market or markets equal to our productive
capacity; and, if not, what is to be the
enect upon commercial values. The fact that
the undoubted commercial revival has not vet
been attended with the rise in prices usual
under such circumstances naturally gives
point to this question. a. The recent unfa-
VoraD4e crop weather has suggested the pos
s1bility Of some drawback upon the grand har-
vest prospects that have so excited the ma
tlonal expectations, which causes some pessi-
mlstIc people to discount the promised farm
ing prosperity and the inevitable increase in
the business of the railroads. (50 Because
though there is nothing in our foreign re!a-
tions 70 suggest impending danger, yet the
annexation OF Hawaii, the reopening of the
sealing question, the delicate possibilities con-
nected with the Klondike gold excitement and
the stage OF exhaustion and depression which
are all new elements that yie,d occasional en-
couragement to the bear side. of the mar
ket (6) Because the market lacks some
elements that are needful to a sustained ard
continuously rising market After such a
long depression. the mercantile and proies-
sional classes have no accumulated profits to
employ in speculation, much less to use in
bona f1de investments. And even the more
important class who are accustomed to en-
ploy large amount of floating capital in
connection with the changing fortunes Of cor
porate securities have less than the usual
amount of resource for engaging in such op-
erauons And CO because the Lon1on and
other foreign markets are showing a yacil-
iating disposition towards our securities. and
IN fact, for the moment at least are reader
to sell than to buy them.
These may be regarded as the chief yea
sons why prices in Wall street are advancing
by somewhat cautious steps, in the face Of
fundamental conditions which under other
circumstances, would have caused an excited
buying movement and a larger advance in
prices. In no one Of these different factors
is there anything to warrant .lEy serious mis-
g1V1ngs. And putting them all together. the
most sanguine bear would not regard them as
Warranting a serious attack On the market.
Their net combined effect is sufficient. how
ever, to temper the sangulne bullish need of
the market and make it possible to get stocks
PACK at concession when operators coo e
to realize profits. In this sense the market
is an easy and safe one to operate N: the
buyer Is sure of rise, AMI he may take his
pront with reasonable prospect of eng
able to buy in at lower prices. This gradual
process OF rise cannot however continue for
ever. Those who are following it are making
very large profits; those profits are being re-
invested in increased holdings; and thus the
demand is expanding to an extent which W III
at later stage, suffice to compel a probably
more continuous and larger advance IN prices
throughout the entire list At the moment il
seems as though we have about seen the end
OF the present reaction, and are ready for
another upward movement.