Daily inter mountain. [volume] (Butte, Mont.) 1881-1901, 1899-12-19
Clearing House Avoided a
Panic in the Street.
STOCKS THROWN OVER
Money Was Dear Nearly All the Day
and Values Dropped Violently
New Combinations Are RESPONSE
bic for Money Being Locked up.

New York, Dec. 1S.-Panic conditions
developed in the stock exchange this
afternoon with the imperative need of
money developed by the violent contrac-
ton In values. Stocks We're being thrown
over without the slightest regard to
the price they would bring and at dis
tressing sacrifice of values. No end to
the heiplessness of the situation seemed
in sight when, in the last half hour of the
market some $40. O00, 900 was offered on
the stock exchange by the concerted ac-
ton of the clearing house banks to force
the rate arbitrarily down to 6 per cent
without regard to the distracted bidding
at higher rates which was being lone by
other brokers for distressed operators.
The collopse in the money rate checked
the decline and drove the bears to cover.
The ~recoveries produced by their urgent
bidding We're almost as violent as the
declines established. The losses were by
no means entirely retrieved. Large
offerings of stocks continued at the rally
and at some points of the list prices
broke anew before the close. making the
closing exceedingly irregular and UNI
settled.
The excitement continued to he end,
with sentiment looking forward anx-
iously for h development of another
day. The seriousness Of the crisis has
called forth the best efforts of powerful
and conservative financial interests
which are busy concerting measures to
tide over the money difficulties which
beset the stock market. and which, by
reason of their extent and the Import
ance of interest involved threaten to
affect the country's business interests
unless obstacles are opposed.
1t is considered a point gained to have
effected a cessation of the ruthless sac
rifice of values long enough for a period
of consideration over night. For the SELL
ing Of stocks had unquestionably reached
that stage where ordinary considerations
OF prudence or even of necessity had
been thrown to the wind and the suffer-
ers from the money stringency were UNI
loading their holdings in the true panic
spirit. A pause Of a few hours for con-
sideration is likely in itself to do much
tOWard r~ectifying such a condition.
So far as actual news was concerned
today there was a suspension by a newly
organized trust company and by a firm
of bankers and brokers who have figured
as traders in stocks to an extent of some
Importance. Neither event in itself would
have been sufficient to precipitate a
crisis. But they We're supplemented with
a whole crop of wild and incoherent
rumors which spared no interest, how
ever long established and hitherto free
from suspicion it may a been. One
would think from the tone of some of
the gossip that was floating about by
telephone. telegraph and by messenger
boys or by whispers, and even by shout
ing in the lobbies Of the stock exchange,
that the whole financial fabric had been
undermined and was abou to tumble
in ruins Yet the day closed with the
two failures above mentioned as the sum
total Of disaster SO far as admitted in
solvency is concerned. The reason for
the widespread effect upon the sentiment
OF the trust cOmpany'S suspension was
that 1t was one of a large number of in
situations recently formed on similar
lines, and which have thrived upon the
multiplying of securities. The securities
of these combinations as a class have
been II disfavor in Wall street for many
weeks past, and in fact ever since the
headlong imitation in their prices and
subsequent collapse last spring. The dis
favor which is attached to them in Wal
street has been quite indiscriminate and
based upon many varying conditions.
The principal allegations against them
are overcapitalizatiOn, exorbitant prices
paid for constituent properties and vul-
nerability to existing and threatened
legislation against combinations. 1t is
evident in SO large a number of cOmbina-
tons as have been made these allega-
ions can scarcely apply to all alike. But
the sheep have not been separated from
the goats in Wall street, and some of the
least fortunate of the new combinations
have been affiliated with the trust com
pany which closed it's doors today.
The incident caused a feeling of dis
trust with regard to the whole class OF
industrial securities. as is sufficiently
evident from the wide breaches made in
the values Of this class Of securities in
the day trading. 1t is to be noted also
sEthHt the very heavy commitments of cap
ital to the trust form of enterprise itself
and it's incursions on the banking field
have aroused muc discussion.
1t has been obvious for many months
past that a great deal OF money has beer
locked up by capital in these new indus
trial combinations which were becoming
burdensOme to carry by reason Of the
heavy demands for money in The regular
channels. the large absorption of funds
by reason of the governments surplus Sc
%curities n the urgent need of the Lon
don money market growing out of the
lTransvaal war. Last weeks threatening
situation in Boston was the outgrOwth OF
the burden of copper stocks. Thus it was
that the trust company failure to-day
coming upon last weeks event in BOs-
ton, aroused the fear that the suspected
clash of securities were or the point OF
~succumbing to adverse influence. In the
effort to protect these securities Others
were also involved, including some of the
most substantial stocks on the list. The
fall in prices added to the by
reason of the shrinkage in the value OF
cOllaterals. Before the concerted relief
by the clearing house banks, the money
rate leaped to so. 20, 100. and according
to the official record 125 per cent. Cred.
liable reports assert that 186 per cen
was paid for money during the day. The