Wheeling register. [volume] (Wheeling, W. Va.) 1878-1935, 1899-12-25


NEW YORK, December 23.-The first
transactions on the stock exchange to-
day disclosed how much Of yesterdays
weakness must be attributed to selling
for short account The rush to cover
short contracts carried prices up with
out regard to factions in the specialties,
which had been the market of attack.
Sugar, Metropolitan, Tobacco. Brooklyn
Transit and Peoples Gas jumped from
31b to points on opening sales. The
same buoyant tendency was shown in
the international list of railroad stocks.
London had lifted these sharply before
the opening here, but they bounded
above the London parity to level from
/ to 2 points above last nights close
here. The urgency Of the demand from
the bears constituted miniature panic
Their short selling yesterday was based
on an assumption that the periodical
settlement in the mines department of
the London stock exchange, which be-
ga nto-day, would disclose so weak a
position there thu. panic would be
likely to result. On the contrary, the
earliest news from London showed
that the settlement in London was pro-
ceeding easily and in an orderly man
ner, sentiment there being much en-
couraged by the shipments of gold from
New York. Rumors of financial en-
tanglement and forced liquidation pur-
sued prominent figure in the financial
world all day yesterday. To-day, on
the contrary, it was affirmed that S10,
100000 in government bonds had been
placed as additional security for this
man of wealth and that his difficulties
were ended. The professional traders
accepted the one rumor with the same
credence as they had the other, and
put in lively two hours trying to buy
stocks to save themselves from loss.
interpretations of the bank statement
were decidedly confused and the market
ran off on realizing 1t did not get
back to the top, but hardened again
materially and closed strong. The
cash increase shown by the statement
of 1919, 500 came as surprise, in view
of the gold shipments and the drain to
Boston. 1t is an evidence of the hidden
resources brought out in such a crisis
as that of the past week. The item of
loans can hardly be an accurate ref1ec-
htion of the net result of the drastic con-
\traction Of the week. The smallness of
the decrease, $3,094,000, must be due
the average system of computations.
What happened in Wall street this week
had been a long time brewing. Any
one of half dozen or more causes
might be cited, but any Of them or all
of them combined were more properly
but the elimination of long series of
causes which precipitated the event.
The whole may be summed up in the
term transportation.
Amongst professional spectators
there is a process expressly termed
"pyramiding." Money is borrowed
with which to buy on margin. When
the price of the purchase rises the adj
vance is reckoned as profit and is in
vested in more purchases. The profits
thus reinvested help to advance the
price, and the paper profits thus mount
up to enormous proportions. But the
demand which has thus advanced the
prices was purely fictitious one. The
pyramid thus created is an inverted
one and 1t topples over when an at
tempt is made to sell to realize. The
capitalists do not call their operations
pyramiding," but the persistent in
aation of values of securities which
went on for months, had much the
same effect. 1t has been long evident
that any large selling to realize would
depress the market, and some very
wealthy combinations have persistent
~ held their stocks and ignored the
symptoms of coming stringency in the
money market, with an obstinate oD-
tlmism regarded the replenishment of
the money supply which results have
not justified. Capitalists and bankers
who had underwritten the securities
OF many of the new industrial iiota-
tions found the market taken from
them and prices of the securities in the
open market dropping below the under
writing price. With this burdensome
load to protect, the growing stringency
of money threw an avalanche of all
classes of securities on the market to
obtain needed funds. It was such a
realizing movement OF large scale
that it had long been sought to avoid.
as the market was in no condition to
stand it. But once started. and the
bears fully understanding the weak
ness of the condition and Offering
prices down with reckless holiness,
the fabric began to crumhle and seem
ed tottering toward ruin on Monday.
when the Associated Banks of New
York, by concerted action offered s10,-
100000 in loans and broke the money
rate. which had jumped to y per cent
per day, equivalent to 1856 per cent. per
annum, in the frantic bidding of hard
pressed holders. With the easing of
the money rate, the panic was checked
and the proceedings reduced to some
sort of order. The market, however.
continued feverish all through the