Arizona republican. [volume] (Phoenix, Ariz.) 1890-1930, 1899-11-03
AN IMPROVED TONE
p Slightly Better Condition
of the Money Market.
Based on a Conviction that an In
provt mentis Shortly Due Rather
Than any Material Changes in
The Situation.


lending circles and in the speculative
markets. In the money market, the
recovery is not so much from any
change in the intrinsic financial posi-
lion as from a feeling that we mus
very soon work out Of the fall strin-
gency which has this year been so
sharp and so proTacted. As a fact.
however. there has not yet been any
real relief in the bank reserves and
no material abatement in the outflow
relief in the situation comes from the
easier tendency in the foreign ex-
changes and the diminished prob
ability of exports of gold, which Is
quite an important gain for the pros
pective loan market. Under these cir
cumstances, operators conclude that
the return of money from the interior
is now the only condition precedent to
easier money, and taking it for granted
that the refiuX movement can hardly
be more than a few days distant, they
deem it safe to increase their pur-
chases of stocks in preparation for the
boom which almost everybody seems
to be expecting for later stage
Still, it may be we'll to entertain
moderate expectations as to the rate
of recovery in the money market. Tn
usual increases in the reserves will be
needed before really free lending can
be reasonably expected, especially as
the wants of borrowers are much larg-
er than ever before and the loans and
discounts have been curtailed by S75,-
100000 since the middle of July and yet
are now nearly $50, ,OOO, 900 more than a
year ago. AS rule, the city banks
are now working on the verge of the
dead line the surplus shown in the
last weekly statement being only
LAO, 600
For the last six years, the surplus
reserve during the latter half of Octo-
Der averaged $40, 500 900; from which it
follows that the present surplus has
to rise nearly thirty millions before it
can compare with the average of thu
last six years. It is not to be supposed
that we shall suddenly leap to such
an increase in the reserves. We had
less than s15, 100000 surplus at the be-
ginning of July, before the interior
drain set in; and with the extraordin-
airy activity of business in all sections
of the country, it at least does not
seem likely that the fall refux of law
full money will exceed the sum we
have parted with during the last three
months. 1t is to be expected that,
following the recent large contraction
of loans, there will be a sharp increase
in the local demand for bank accom-
mOdations, with corresponding addi-
tion to the amount of reserve require
ments; on the other hand, the aug
mented volume of business at the in
terror viii tend to keep money back
from the New York banks; and thus,
between the two currents, we may
quite possibly find money quite active
for some time TO come. Whether such
a state Of the market would drive the
current large foreign trade balance to
compel us to draw upon Europe for
gold, it is impossible to prejudge in
the present disturbed condition of Eu-
ropean politics and finance. That
however, seems to afford the only
chance for our escaping a continuance
of the present money pressure for some
time to come. While, therefore, there
is no visible reason for apprehending
any return to the recent severe scare
ity of money, yet neither can We at
present forsee the point at which bor-
rowing will become so easy as to war
rant unrestrained "bull'' speculations.
While these indications are far from
being encouraging to the selling of
stocks, and while they fairly permit
purchases at current comparatively
low prices, yet prudent speculation
will not lose sight of the evidences that
the position of affairs still remains an
unsettled one.
The situation introduced by the
AngIo-B Boer war is still far from eX-
empt from adverse possibilities that
may need constant watchfulness AT
this center. There is little question
about England's ability to finance the
war without occasion of much dis
turbance to her markets and her in
vestments, nor can there be a second
opinion about her bringing the strug-
gle to a close when all her forces have
been landed at the scene of conflict.
Apprehension, however, is now turning
in a quite different direction. The
question is whether the long standing
continental jealousy against Britain s
imperial power may not lead to a con-
spiracy, notably between Russia and
France, for checkmating English pro-
gress. Although there is much talk in
Europe on this possibility and the air
is full of rumors about preparations