New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1899-05-21
financial.
The Financial World.

Precedent not being a law. but q rule: ana
rules having always their exceptions u is still
an open question whether or not the present
market will prove an exception; that H. whether
OF not the prices of stocks will go back 10 where
they struck bottom In the great break a week
aso. II they do not. precedent In THIS Instance
viii not hold good and II they do IL Will IL IL
also according 10 precedent that when there IN
the slow sinking back after the rebound from
sudden smash. the declines are not uniform
some stocks may stop little short OF touching
their record level. while others may break below
H. The next two or three weeks VIII probably
determine the question for this market Thers
Will have been time IN that period for the specu-
lativc movement to have taken positive direc-
ton. There have been rumors that some big
Upward movement has been prepared next week
We should feel more confident about this N
they did not bear 70 much resemblance 10 the
statements circulated the last part Of April that
n great upwari movement was to start with the
lst OF May
Not few whose interests on the bull side
land ali commission brokers are). had begun %
have doubts about the immediate future Of the
market from the way II acted as the LIST ~ May
approached: but the many assurances from In
huentisl quarters that. as soon as the April
settlements were over and money became easy,
there would be- another strong forward move
ment had the effect OF keeping hope alive
When May brought no such movement. but only
ftful advances in one or two stocks with de-
ciines IN others. hope departed. II was difficult
then to persuade ones self that the market was
not entering upon one OF those periods Of re-
cession which invariably interrupt the progress
Of all long continued bull movements II Is the
"a ~
go one whether big or little man. can
do more than guess; because II depends upon
factors stll disputed and upon conditions stlll
indeterminate.
What we see in the higher speculative circles
at this time is divison OF opinion. and conse-
quent diversity OF action; whereas at the be-
ginning OF the year. opinion and action were
practically unanimous. We find now some lead
ing operators who are actively bearish: others
actively bulllsh, while a still larger number are
undecided and therefore doing little or nothing.
With such divided leadership. the general specu-
lative public stands off, waiting. Thus the
market becomes narrow and professional. That
IS what II is now.
The reasons advanced by those who believe
the market is going down. may be briefly
summed up: first. that the enormous rise In the
prices OF stocks discounts the favorable condi-
lions In anticipation OF which they were ad-
vanced; and there would be little room for
further upward movement In them from this
level. even II these conditions remained I'M
changed in any degree for the worse. Second
that there has been change for the worse and
a serious one. in the certainty that the only
crop about which can know anything at this
time, VIZ the winter wheat. has been badly
damaged only the extent Of the damage Is In
dispute not that there has been damage. for
on that all reports. Official and private. are
agreed. Third, that the unlimited and stiil
continuing creation OF new industrial securities.
is a menace to sound financial conditions.
These are the main points OF contention. II
! will readily be seen that the second is Of very
great Importance, for II we have winter wheat
crop cut down seriously, It will hurt the rail-
roads badly; and necessarily 1t must hurt most
those where the loss is largest. Special atten-
ton. therefore. should be given to the localities
! Of damage So far. it appears that Kansas is
the worst of On the other hand, California
seems to have this year complete reversal
of its bad luck OF last year.
One may pass, with brief reference, special
circumstances affecting special stocks as the
| COS war. which already threatens the dividends
of the Consolidated Gas Company; and the Ford
Bill. which affects specially the traction stocks
There would be little here ordinarily to anect
the general market; yet as these stocks al this
particular time have leading place IN the
current speculation. anything which touches
them adversely has to that extent genera
Importance.
When we turn to the arguments advanced on
the bull side, we are necessarily compelled 10
travel over old ground We have been over and
over IT, again and again in the past six montns'
1t was upon facts and conditions now SO m
millar to u.s. that the prices of speculative Sc
curities doubled, that the business on the STOCK
Exchange Increased and expanded beyond prece
dent: and out OF them grew that mushroom
creation Of new securities whose volume, al
ready enormous and still increasing, threatens
/ sooner or later to make serious trouble we
have. therefore nothing which may be called
new on the bull side. We cannot point to any
fresh DEVELOPMENTS calculated TO furnish new
fuel to waning fire.
Then has the great bull movement eliminated
finally? That is a different thing. There Is no
present evidence that II has. There is nothing
10 show that after period Of comparative rest
and recession, 1t will not be resumed with vigor'
What is stated here is the basis upon which the
argument is founded that a period OF rest ano
recession Is due.
Whether to get IL now, or whether ths
speculative momentum is still strong enough y
carry the market upward until there come
final crash. it is not pretended here even u
guess 1t is certain that some of the most po"
erfu capitalists are deeply engaged In scneine'
which are Jet IN their earlier stages or develop
ment, and at that stage which makes risin'
stock market very necessary. The Amaisa
mated Copper scheme is case In point A tal'
Ing market just when T5,WOUUO or pertecti'
new stock had to be taken care or Is no
agreeable. These people may be reckoned on U
do their best on the bull side. They are iorce'
to that position by the burdens they nave o'
their hands. They are favored by easy money