Omaha daily bee., 1899-12-24
MOVEMENTS OF STOCKS AND BONDS.
Urgent Demands of the Bears Cause
Il Miniature Panic,

Urgent Demands of the Bears Cause
n Miniature Panic.
NEW YORK, Dec. 23.-The first transaction
on the Stock exchange today disclosed how
much of yesterdays weakness must be at
tributed to selling for short account. The
rush to cover short contracts carried prices
up without regard to fractions in the spe-
%cialties. which had been the mark of at
tack; Sugar, Metropolitan. Tobacco. Brook
Ign Transit and Peoples Gas Jumped from
3h2 to . points on opening sales. The same
buoyant tendency was shown in the inter-
national list of railroad stocks. London
had lifted these sharply before the open
ing here, but they bounded above the Lon
don parity to a level from l to 2 points
The urgency of the demand from the
bears constituted a miniature panic. Their
that the periodical settlement in the mines
department of the London Stock exchange.
which began today, would disclose so weak
a position there that a panic would be
likely to result. on the contrary, the earliest
news from London showed that the settle
ment in London was proceeding easily and
much encouraged by the shipments
of gold from New York. Rumors Of imam
eial enhancement and forced Liquidation
pursued a prominent figure IN the financial
world all day yesterday. Today, on the
contrary, it was affirmed that 100000 in
government bonds had been placed as adj
ditional security for this man of wealth
and that his difficulties were ended. The
professional traders accepted the one rumor
WIN INV StlHt SbtilN 40 lltS lldu me
other and put In a lively two hours trying
to buy stocks to save themselves from
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
shown by the statement of So, 1872, 800 came
as a surprise, in view Of the gold ship
evidence of the hidden resources brought
out in such a crisis as that of the last
week. The item of loans can hardly be
an accurate reflection of the net result Of
the drastic contraction of the week. The
smallness of the decrease, 1904, 900, must
be due to the average system of computa-
lions.
What happened in Wall street this week
had been a long time brewing. Any one
of half a dozen or more causes might be
cited, but any of them or all of them COM
bined, We're, more properly. but the cul-
mination or a long Series of causes, which
precipitated the event. The whole may be
Amongst professional spectators there is
a process eNpressively termed pyramid
buy on a margin. When the price of the
purchase rises the advance is reckoned as
profit and Is invested In more purchases.
The profits thus reinvested help TO advance
the price and the paper profits thus mount
up to enormous proportions. But the de-
mand which has thus advanced the prices
was a purely fictitious one. The pyramid
thus created is an inverted one and ii
topples over when an attempt is made to
sell 10 realize. Inc capitalists do not call
their operations ''pyramiding,' but he per-
sistent indation in 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 mar
ket and some very wealthy combinations
have persistently held their stocks and
Ignoring the symptoms of coming stringency
in the money market, with an obs innate
optimism regarded the replenishment OF
the money supply, which results have not
justified. Capitalists and bankers who had
new industrial fotations found the mar
securities in the open market dropping
densome load to protect the growing
s%tringency OF money threw an avalanche
of all classes of securities on the market
to obtain needed funds 1t was such a
realizing movement on a large scale that
II had long sought to avoid, as the mar
ket was in no condition to stand It But
once started and the bears fully understand
ing the weakness Of the condition and Of
fering prices down with reckless holiness.
the fabric began to crumble and seemed
10 be lettering toward ruin on Monday,
when the associated banks OF New York.
by concerted action, offered SlO,O00.OOO in
loans and broke the money rate. which
had Jumped TO y per cent a day, equivalent
TO l6 per annum, in the frantic bidding
OF hard-Gressed 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 feyerish all through