The times., 1899-05-14

IL
sufferers. This. however. does not mean
necessarily that any one of these stocks
lacks merit. 1t illustrates simply the big
ness of Mr.. Flower and the strength of his
following. II is now brought forcibly to
the memory of every one familiar with the
history of the past year in Wall Street
that this gentleman has been the COM
mander-in-chief of the boom of 1898, the
one overshadowing figure among the tig
crowd of optimists who have believed that
the country is beginning an era OF great
prosperity, and who have acted on this
belief.
But Mr. Flower has been rarely honest
and straightforward in his manipulation
of stock values. He has not buoyed the
prices of his stocks beyond their actual
value, or at least certainly not beyond
their potential value, in any case. Every
thing that he has doomed has had the ac-
tual merit to make IL a safe and conserya-
tive investment, if not conservative spec
ulation on three points margin. All these
industrial and railroad companies with
which his name has been prominent are
sound, strong, meritorious companies, with
brilliant futures. 1t is not to be doubted
that in some cases the prices of his stocks
have advanced beyond what they would
sell for in the market without the support
of himself and his followers. This simply
meant that MIR. Flower was a shrewd man
and wished TO take the harvest of advanc
ing prices instead of allowing someone else
to do it later when earnings had been made
and distributed in dividends. One other
fact is not to be disputed. At times prices
in some of Mr.. Flowers stocks advanced
more rapidly than he wished them 10, or
considered safe. The break in prices in
Brooklyn Rapid Transit and the Federal
Steels recently was not without his knowl-
edge and consent. 1t is understood, how
ever, that il went further after 1t started
than he had wished, because of an un-
founded fear that he had deserted the bull
side of the market. When the recovery set
in it was a strong though 4 conservative
one, with his hand on the rein all the time
TO prevent more skyrocketing.
The very clear meaning of this is that
these stocks are not likely to be among
those that will fall behind during the COM
ing readjustment of prices. The F.ower
forces may be disorganiZed for a time, and
his stocks may suffer temporarily. This
is only to be expected in fact. But the
actual intrinsic value of the stocks as divi-
dend payers and as prospective dividend
payers will not be overlooked for long,
while there is so much money for invest
vest il. An opposite view to this is taken
by many people. but their reasons are not
good nor their faith in the property of the
country strong. Brooklyn Rapid Transit
will continue to increase its passenger
traffic in the same wonderful way, Peoples
Gas will have just as large sales of gas,
and the Federal Steel Company will con-
tinue to grow with the phenomenal
growth of the steel trade despite the sad
death of Mr.. Flower.
One of the peculiar circumstances of the
day was the immediate drop of prices TO
their lowest level. Within two minutes
OF the sounding of the gong yesterday
morning prices were lower than they were
at any time after. There were bargain
hunters in the market buying at the mo-
ment the first sales of stocks were made,
winning when the skeptical and the un-
fortunate were losing. Before the end of
the day prices had advanced from the
lowest one 10 ten or more points. This is
significant because it shows that big peo-
pie were anxious and willing to support
the market and did do it. Anthony Brady
ID. o. Mills, and the Standard Oil magnates
were heavy buyers of stocks during this
first wild five minutes, and there were
others nearly as prominent. II may be
considered a certainty, too, that these gen.
tlemen were not actuated by sentiment en-
tirely or even largely. They bought stocks
because they considered them cheap. 1t
is a well-k known fact that the Standard
Oil people have been buying stocks for a
month or more heavily. and that they have
thousands OF shares. purchased five to fif-
teen points, at least, above the level of
yesterday: And these gentlemen are con-
sidered TO be the particularly shrewd men
of Wall Street.
AS TO the immediate course of the mar
ket it cannot be doubted that it will be
wild and that there will be downward
plunges as well as spurts upward. The
brokers will be obliged TO borrow an i'm
mense amount of money 10 carry the
stocks they have been forced to hold af-
ter margins were exhausted. This will be
likely TO cause furry in money, though
the banks do their utmost TO prevent it,
Brokers who have Brooklyn Rapid Tran
sit to borrow on will not get as much for
1t as they would have secured three days
ago Another unpleasant feature of the
situation will be the selling by the brokers
of hold-over stock taken from exhausted
holders, as soon as prices recover a few
points. 1t cannot be estimated how much
of this stock there is, but undoubtedly 1t
is an immense amount. A third bar to
a quick and steady recovery must be the
fact that the people who have consti-
tuted the speculative public up to this
time are largely sold out now and unable
TO obtain the large margins that brokers
are demanding. But with all these matters
TO contend with, it is very certain that
within very few days they will be at a
much higher level.
The bank statement was one of the most
encouraging ever issued by the New York
banks. AT any ordinary time 1t would
have caused fine revival and upward
squirt of prices. And it cannot be doubted
that its effect viii be felt this week. Even
though money does become tight, it would
have been tighter II the banks were not so
much better off. The figures of the state
ment follow:
Reserves, increased. ..............N 81, 1S5, ,675
| Loans, decreased. ......-.......... 5,s56, 200
Deposits, increased. 1885, 300
Legals. increased. d.................. $4,000
| Specie, increased. ed...-............-. S,205,6OO
| Circulation, decreased. ........... $500
The standard issues, many Of them,
withstood the break in a remarkable way.
| Compared with the tumbles in the Flower
stocks they experienced nothing more than
| slight fiurries. The grangers lost point
or two net for the day. and the coalers,
| Vanderbilt issues, Goulds, and Southern
stocks were all excellently supported by
| buying orders from the first. The prices
at the lowest point of the day were gem
orally trlfe lower than they were during