The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1897-09-13
STEADY GAIN ON ALL SIDES.
EVIDENCE THAT TRADE HAS RE-
TURNED TO ITS NORMAL
CONDITIONS.
IS LONG OF CROPS
And Short of TroubIes-Henry Clews'
Terse Way OF Explaining Re-
newed Activity.

Henry CleWs says:
Since my last advice the market for Sc
curities has exhibited the irregular strength
and steady activity which have characterized
it during the recent weeks. In the general
outside conditions affecting prices there has
| been no material change
! The drift of commercial affairs throughout
| the country adds new confirmation to the
promise of of sound and steady ma
tional prosperity which has laid the basis
for the general large advance in securities.
Their Is every evidence that the trade Of
/ the country has already recovered its full
normal volume and that the obstacles that
| have so long INSTRUCTED 1t have now en-
tirely lost their repressive force. This is
| paced beyond question by the fact that for
the week ending Aug. 2S the transactions
| at all the clearing houses of the country
| exceeded those for the Ike week of last year
! by Al per cent, while for the month of Au-
gust the increase was Sc per cent. The
months volume exceeded that of August,
! 1690-which was the largest year in the his
tory of our banking operations-notwith-
standing that general prices are now fully
10 per cent lower than they were at that
| period. Further evidence OF the large eX-
| pansion of business is afforded by the loans
| and discounts OF the New York city banks.
! For the week ending Sept. this item stood
at 1858 100000, which, as it will appear from
the following statement Of the maximum of
| loans in the fall months since 1887, is the
| highest sum reached at that season of the
| last ten years
1897. Sept $3.50 800 OOOnSs2, Sept $4s7, 100 00O
1895 Sept IA 522, 7Ol COO 1890, Oct. II 4O6, O9O
1894, Oct. SOC. 800 00018S9, Sept % 499 300 coo
1893, Sept. 40O,20O0C0 1888, Oct. q 1881 COO
The city banks are now lending IA per
| cent more than the highest volume ever at
tanned in the history of their operations.
| This is incontestable proof that the amount
| OF current business transactions exceeds all
precedent 1t is true that we now have
about 100000 more population than we
! had in 1S9O-the period of highest previous
maximum of loans-but against that fact
must be set off the great fall in all values
that has occurred since that date.
| This sudden expansion to condition of
normal activity has in it no element of spec
| ulatiCn. 1t is in response to bona fide wants,
| and shows zone Of the dubious elements of
| mere manufactured BOOM The fact
that such measure of recovery has come
nithin the short period of three or fon.
! months is very satisfactory sign of the
| sound financial condition of men of business.
1t means that the weak Clements of credit
have been weeded out during the recent de-
| finances in sound shape for meeting the re-
| quirements of a period of large commercial
! expansion.
What may be the magnitude of those re-
which the satisfaction of a wide range of
wants has been postponed during the last
four years. In every branch of production,
excepting those most essential to su5sis-
! tence, this process OF poStponement has
been in force. In buildings in the home and
its furnishings, in the wardrobe, in our fac
tenance Ct railroads, this avoidance of eX-
penditures has been rig dly enforced. Four
years of this sort of economizing is probably
| about equal to the citizens total exbenGi-
lures Of enc year; and that years measure
of abstent:on from the supply Of reasonable
wants has now to be made coed. 1t is enc
thing that there should be such an impor-
tant pressure for an extra supply of wants
| 1t is another that the business thus created
] should be done at fair rate of rrcft. On
this there is no reasonable cause for doubt.
Wa 81 ar rr;an hoc hoon
arrested; surplus stocks are being fast Gear
ed Off, and in all directions ccnzumrt'o on Is
gaining on production. At last. therefore.
we seem to be in fair way towards rem
edying the great excess of supply over con-
sumption, which has for several years past
been forcing the great fall in prices and the
extreme depression in business We have
in fact. reached a new starting point upon
lower basis of costs of product.o on and
| of prices to consumers: which means a
broajer production and the capacity for a
larger consumption per head of population
| than we have hitherto reaiZ- d, to say nothing
of the new wants art.iicg from an increase OF
1GeGO,6O9 in our POPULATION since the Begin
ming of the current decade. These facts
have been steadily forcing the readjustment
which we now see in full opera ion. They
explain the great revival and justify it by
| making the movement natural AMI re- A.
, nent.
1t is this process which constitutes nine
| tenths of the cause of the current remarkable
| recovery in the market for securities Other
minor causes, chiefly Of political nature,
there have been. but they would have
produced little visible effect without this
radical reconstruction in the conditions of
production and distribution, of supply and de-
mand. in the commercial markets. The people
| find no difficulty in comprehend ng the mean
ing of these new elements in the situation;
the factors tell their own story to every COM
mon sense observer; they explain to every
| body's satisfaction the basis of the prophecy
| ings of better times - is lis clear compre-
| hension of sound and natural reasons for ey-
! "
which explains and justifies the present san
| guine feeling on the stock exchange. These
conditions have made speculation inevitable,
| because they have restored to securities all
the inherent value they had lost within the
last four years of decline. Thus the market
needs none of the arts of profess .onal manip-
ulation to put up prices. Values rise because
the earning capacity of corporations is in
creased, and because that increase is seen to
be of a bona fde and permanent nature. II
prices do not advance at once to an extent
commensu with the Importance of the
causes affecting them, it is because of the
great breadth and versity OF the supply of
issues awaiting the Improvement Prices can
be raised only by passing through a market
process of dealings. Those exchanges have to
be repeated indefinitely to produce that effect
and when the stock of issues the market is
endleSsly varied and enormous in amount
! the mechanism of finance can accomplish the
task only by process OF slow detail and by
constantly changing operations from one set
Of issues to another This must account for
the seeming .s,owness eff prices in advancing TO
IA parity with the improved conditions affect
ing values; and this It is which affords oppor-
tunities for "bear" manipulations and fire.
quent realizings But through all these os-
citations market values must continue to adj
vance; and it may quite possibly take several
months before they have reached a point at
which conservative men will deem it prudent
to pause.
London still hangs on the skirt of our stock
market being alternately buyer and sefer.
The Bank of England appears to be using its
utmost influence against purchases Of securl-
ties which might bring some of its g2ld to
New York. On Thursday it refra ned from
advancing its rate of discount which is evil
dence that it's exposure to losing gold is at
least not becoming more aggravated. 1t is,
however By no means improbable that it may
nut I'D its rates at later stage, for cur ex-
| change market is in such pos ton that the
arrival of few millions more of cotton bills,
in addition to the large amount being made
against large shipments of cereals, might pro-
duce imports eff gold. 1t remains to be seen,
however whether the relative rates for money
at New York and London might not cause ex-
mort bills to be bought Up here, as when ex-
change was largely n our favor last year.
in which case imports of gold might be more
or less postponed.
and long of troubles.
LONDON MARKETS.
&C eIsnoJapS5,S Silver Tepservx.