New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1898-05-08
financial
The Financial World.


should be received from Dewey, very high prices
would be SEEM CD that to the account Of the bull
side Of speculation must be put the rising prices
OF agricultural products; and CD that though
these rising prices might be set down TO other
| causes than the war yet in the farmers mind
high prices for his produce were so associated
with war. that an agricultural community was
! always more ready for war than a commercial
one which usually suffered by 1t.
The first and second of these propositions
| have been strikingly exemplified by the events
Of the past week; the third will demonstrate
itself later and will strongly influence the future
action of Congress. K is fact which Will have
to pc borne in mind when the policy of the
country is being shaped as the result Of war;
1t may be said that in the first part Of the
week 1t was a market; then IL became a
wheat market. and 1t wound up yesterday as
a war market again on receipt of Dewey's pthy
dispatches AS the one bullish influence came
on top OF the other there scarcely a pause
between the operation Of either. and recess
sion in the forward movement until Friday
noon. when heavy selling to take profits caused
a decline. But the buying orders which poured
/ In from the outside yesterday again carried the
market forward.
The advance for the week in the leading
stocks has ranged from five to ten per cent.
When business closed yesterday there was a
| confident feeling that news Of another naval
success would be furnished over Sunday upon
which TO open the market on Monday morning:
and also there was another and yet greater
advance In the wheat market. The public buy
! Ing yesterday was unmistakable, and ii will In
crease and broaden. II Is the first time the
public has shown itself, the advance hitherto
having been mainly professional This public
! mo cet % Com
! mcdore Dewey for he has completely relieved
the popular mind Of any anxiety about the
| From uncertainty tnged with anxiety tmainy
! because Of the doubts about the modern war
| ship, the feeling has changed to simply asking
! how long the unhappy country we are lighting
| can stand the pounding. It is the collision be-
| tween an eggshell and hammer.
The feeling of relief first and which was raised
! to one OF exatation yesterday. was shown In
| th,s-that after the exciements were over in
the early part Of the we *, people began to talk
about the wheat market and the big earnings
of the railroads. These were things which GOT
scant notice while there was anxiety az to the
fighting. When relieved on this score there
came to the front the economic considerations
involved in May wheat at prices higher than
have been since the United States first lost its
virtual monopoly OF the wheat market, back In
the early sos A wild whoop went up when
Nav wheat touched $50. and the July option
! q dollar. Yesterday. the former had gone above
81 GO, and the latter 70 Sl.O3. The July option
covers the new crop.
1t is an open question whether the war IN
itself has added as much as ten cents TO the
market price OF wheat II is certain that the
exhaustion Of the worlds reserves OF the cereal
has been the solid basis Of the rise. and there
fore there is permanence In it. The war may be
short: but we know how long it takes 10 grow
a new crop OF wheat The best crop which Is
likely TO be raised this year. in all wheat ex-
porting countries. Will not restore these world
reserves to normal proportions. according 70 the
best expert opinion. And with such A shortage
in wheat a rise in the price OF other food proc
ucts is a natural concomitant.
This makes the future OF the granger roads
certain Their earnings the next eighteen
months VIII be enormous. The present specula-
tive movement in the market will probably carry
the prices OF their stocks well above the best
which were made last September. In that month
the big rise eliminated which had been started
on the wheat crop OF the year and the foreign
demand for It, That wheat boom is distanced
by the present one. and on Top Of It we have
the excitements of military success.
All conditions at this time point TO q bull
market which will eclipse anything We saw
business done.
Upon the duration Of the war depends It's COST
The conviction that IT will be short one has
changed opinion In banking circles as TO the
financial measures necessary to meet 1t. Some
eminent bankers are strongly OF the opinion that
an issue OF 1920 bonds would be unwise. They
say 1t Is better politics, and better finance, to
pay for the war by taxation. Long term bonds
are not needed. Certificates OF Indebtedness
should be issued in place OF them. They can De
paid or by the Government whenever 1t gets
surplus funds from taxation. Such certificates
bearing 3 per cent interest would be taken by
the, banks as fast "a issued by the Government
~ the banks were authorized TO issue notes
against them. the same "a against bonds.
The Government would put them out only N
needed and only to the amount needed. In THIS
way. an accumulation OF money In the Treasury
which might follow from the issue OF a fixed
amount OF bonds would be avoided. Experience
has shown that a large surplus in the Treasury
"a almost as much to be dreaded deficit
IL leads to extravagant and corrupt legislation
IL Is a perpetual temptation to the worst eie-
ment in both political parties All danger from
this source would be avoided by the substitution
OF certificates OF Indebtedness. which are merely
a demand note. payable at any time. ana never
issued In amount beyond the immediate needs
OF the Treasury The new taxation PROPOSED
would pay OFF all that this Is likely 10 call
for. long before the expiry OF the bonds pro-
posed Leading bankers here are pressing TINS
view on the Secretary OF the Treasury, ana
urging that the bill now pending In Congress
be so modified.
In the coming week. supposing no accident
happens every stock which has its circle OK
friends big or little will be likely 10 sho"
activity The granger stocks should be special
favorites Rock Island for both general and
spec,al reasons may be expected to see a price
ni,n,.. mr. Chicarn Gas will also move BROOK