The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1899-11-13
STOCK LIST WAITING
BUYING HELD IN CHECK BY CON-
OPTIONS IN THE MONEY
MARKET
RAILWAY SHARES ARE STRONG

LOw-Priced Issues, in the Opinion
of Henry CIcNvs, Likely to Score
Good Advances in the Next Six
NIonths-GOvernme VIII Buy
Wise or Necessary.
NEW YORK, Nov. 12-Henry Clews
weekly stock letter says: The stock mar
ket continues in a somewhat waiting atti-
tude. Buying is held in check by money
market conditions Until these become
more favorable any extensive bull move
ment that may be inaugurated is likely
TO meet with serious resistance. AS for
the future of the money market, funds
are likely to return from the interior
more slowly and in less amount than
usual Industrial and commercial activ-
ity insure a good demand for funds for
some little time to come. Meanwhile the
treasury continues to absorb money, add
ing to general stringency, from which the
only relief in sight is Its return from the
interior or the purchase Of bonds by the
government. The latter device has been
resorted to before to counterfeit the i'll
effect Of treasury operations, and there
IS no doubt that Secretary Gage will buy
bonds when conditions fully warrant do
ing so. 1t is useless, however, to eX-
pect the secretary, who is an astute finan-
Cier, TO undertake any method purely for
the benefit of speculative operations. In
my opinion, q fairly good interest rate
for money just now IS beneficial, as it
acts as a barrier against gold exports.
The situation IS so unusually favorable
in most respects that excessive specula-
ton might easily be preclpitated upon the
country, which would mean a violent and
perhaps pros; rating collapse later on. Stiff
rates for money are financial brakes; and
at a slower pace the market can more
safely respond to bulHsh influences. Mon
ey should soon begin to return, resulting
in rising bank averages. No alarm need
be felt should the reserve temporarily fall
below legal requirements. The safety
line is ample enough TO avert all danger
and the law is so designed as to give the
banks sufficient time to strengthen their
reserves before the comptroller, who has
large discretion, can take action.
Bank clearings and railroad earnings
both emphaucally remind US Of the phe-
nOmenal advances which the country is
making. Activity prevails in almost ev-
cry trade and in every section OF the
land. New enterprises are springing up,
some to supply new wants, others to inset
the great demand for manufactured
goods. The railroads are obliged to face
increased expenses, but advances in rail
rates and heavy traffic promise continued
large net returns, and the ranks of divi-
dend payers are likely to be increased.
RaliroEd securities still constitute one of
the safest forms of invcs tment and some
of the lOW-priCed issues are likely to score
good advances during the next six
months. The industTialS are also MAX
ing extraordinary profits but these can
not continue when increased competition
begins and trade demands assume normal
proportions.
An important difference between the
former administration and the present
one Is that the previous one had such
a depleted treasury, due to the con-
tinuous bad times that the government
was compelled to be constant seller of
bonds; while the present one. due to
good times prevailing, has an excess
of money in its vaults, the locking Up OF
which is retardin;y the prosperous busi-
ness Of the entire country. To admit
of this money getting out of the treas
ury the government would certainly be
justified in buying up some of the very
bonds that We're sold during the last ad-
mlnistration and. as the money paid out
therefor could be advantageously en-
ployed by the tmeriean enterprising peo-
pie, it would doubtless be a saeacious
policy to adopt besides making the con-
trast a very marked one between the
financial conditions of the two admins
trations.
The low reserves of the New York
banks are an evidence of the CONNER
cial and Industrial activity of the coun-
try. AS it is well known, the asso-
ciated banks of New York are below the
% per cent reserve required by law Thi
very large reserve is only imperative
by law upon the national banks The
banks organized under the state law are
only required to keep a 10 per cent
reserve
Quite a number of state banks are
in the New York Clearing House asso-
citation, and by a rule of the association
the reserve is counted at % per cent
on all the banks alike. If the s'ata
banks were classed at Is per cent ana
the national banks at 25 per cent it
would give the latter an excess in reserve
Of the legal % per cent. There Is, there
fore, nothing to disturb confidence in the
last weeks bank statement. which
showed the banks to be $33S. $50 below
their reserves. The money that has re-
has been needed for pay rolls and pocket
money, which in the aggregate was new
er so low as now. and applies alike to
every section of the country. The aver
age amount Of money carried in the
pockets of people, estimated at S. each.
which is comparatively small amount,
is 1915, coo. The New York bank re-
serves, estimated at % per cent, now call
for $lSS, 9OC,0 900. The reserves of othec
large cities are about in the same pro-
portion. These reserve funds represent
so much money out of circulation The
same is the case with the large sum now
held by the United States treasury, the
amount being $3.50, POI, sos
The present activity and high rates for
money simply give the opportunity for
the banks to loan funds out literally.
as it is through interest rates that money
is obtained for dividends to the stock
holders of the institutions, and as the
activity in money at the present time
is caused by. prosperity, they feel JUST
fed in putting out all they can There
never was time when it was safer
to do It.