Arizona republican., 1899-12-14
A Moderate Money Strin-
gGncy Not Bad.
COOLS FOOLISH ARDOR
An Interesting Feature of the Gen
eral Financial Situation is the
Rate of Discount in England the
Highest Since the Barring Panic.
The Probable Cause of It Dis
cussed.

AAooaD10 OduSS VI IL Ols-
cussed.
New York, Dec. Especial )-some
disappointment is expressed at the
tardlness which the stock markat
SHOWS in responding to the rnany ex-
listing favorable conditions. With nm
usual prosperity in all parts of the
country, it has been reasonably and
generally supposed that higher pricas
would prevail during the fall and early
winter months. So far. these expeo-
tatlons have not been realized chiefly
because of the high rates and limited
supply of money. For ordinary busi-
ness purposes there appears to ba no
serious lack Of funds at good yet not
e&orbitant rates; while the moment
speculative demands assert themselves
with any force stringency is at once
prevalent. This restraint has its ad-
Vantages, in that it oools the ardor of
over-enthusiastic or indiscreet bulls.
and paves the way for a more sub
stantial movement later on. 1t is far
better that the market should have
ample season in which to become we'll
established on the new level. than to
permit a runaway speculation which
might easily invite severe reactions
and general destruction of confidence.
There are indications that this view
is taken by some Of the influential in
terests in the street." who while COM
mitted to bullish views in the long
run are not at this time willing to
lend their powerful aid to any upward
movement.
An even more important factor in
the situation than the disposition of
big operators, one in fact which large
ly controls them, is the money market
High rates for money do not always
prevent bull movement; but it is
quite certain that just now any such
campaign would be quickly brought to
grief by prohibitive rates. The bank
reserves are much below the usual
average of the season. Trade activity
retards the return of funds from the
interior. The treasury continues to
absorb money, and the offer to buy
bonds affords only partial relief. as
holders have other uses for them than
the interest they pay. In short. there
is a large and perfectly healthy de-
mand for money which can not freely
be met because of a cumbersome and
antiquated currency system which pre-
vents expansion or contraction accord
ing to the needs of the moment. jan
uary disbursement will amount to
probably S15O,OOO,OOO. preparations for
which will keep money more or less
active meanwhile. Still another fac
tor of Importance must be recxoned
with, and that is foreign exchange.
Sterling has advanced owing to the
nigh rates in London, the Bank of
England rate of discount being at it's
highest point since the Barring panic.
1t cannot be said that this stringency
is due to weakness or fear. but rather
to a prudent determination of the Bank
of England to protect its gold reserve
and prevent demands from the Argen-
tine or elsewhere. Trade activity is
almost worldwide, so the demand for
money on this account is not limited
to the United States; and with a par
tial cessation of the gold supply
through the Transvaal war it is not
surprising that London should take
means for self-protection. Gold ex-
ports from the United States may hap
pen, but do not seem probable, for
money rates would quickly harden in
response to any such movement. As
said above the local market is not
likely to get any relief through the
medium of foreign exchange for some
time to come. There are fair offer
ings of bills against remittances and
manufacturing exports, while the sup
ply OF grain and cotton bills is much
below the average Conditions are
somewhat strained in Berlin, and a
pinch there or in London would of
course be to some extent reflected here.