New-York tribune., 1899-09-17
financial.
The Financial World.


sary for it even 10 go to such comparatively
mild figure as 10 or II per cent per annum;
nor for the banks to call loans extensively. II
simply required that the banks should have
reached condition whore further expansion
OF loans impossible. This point being
reached. there the end. The market began
TO shake and the shaking Of course started with
the stocks which had had the greatest imitation.
! II must be confessed, however. that the break
has been much more severe than seemed likely
at the close OF last week. 1t appeared then that
money rates would be marked up, and that this
would operate to squeeze out the loan accounts,
go that a slowly dropping market would follow.
/ And this would probably have been the case had
It not been for two thngs-frst the sudden and
most demoralizing unloading of Brooklyn Trac-
ton: second, the disappointment over the ST.
Paul dividend. These two together were too
much for the market 10 stand. Every day II
weakened. and yesterday It was weakest of all
some stocks-like Metropolitan having quite
sensational breaks
Nevertheless the highest rate for money at
any time during the week was only per cent
and that only for few minutes; while the aver
age rate has been no more than per cent
a rate which the Financial Chronicle" yester-
day. said would probably be seen for the rest Of
the year
The much exploited theory that there were un-
told reserves OF money In the trust companies,
| was exploded soon subjected 10 a little
| cold examination; the assertion that money l7
more evenly distributed over the country than
it has ever been before Is capable of proof But
the fact Of such distribution did not prevent
the New-York banks getting 70 point whore
they had TO contract loans instead Of expand
them. There was no large contraction the past
the averages Of the bank statement. which "a
not a large percentage on a total Of S139 mill
ions. The real trouble was that the banks could
not further expand, and therein was the fatal
weakness Of the pools and combinations which
were holding large amounts of stocks. II there
was sudden selling movement, on a large scale,
in any one Of these stocks IL could only be sup
ported by equally large buying, nccessitating
the borrowing of several millions more money
by the supporting pool In the condition the
banks are in this borrowing could not be done.
This was obviously the cause Of the break in
Brooklyn Traction, which opening at 1Ol last
Monday sold at Sc on Friday. Some one-Who 1t
was is varousy guessed-unloaded eXtra0r-
dinarily large block Of that stock last Monday
and Tuesday. This revealed its weak position.
and from that moment it was mercilessly ham,
mered until the low price Of Friday was
reached when it was obvious that former sellers
4 became buyers both for long and short account
and the further decline was stayed. II was re-
ported yesterday that new combination had
been formed. or would boz over Sunday. 70 sup
port this stock and it IS possible that II this ia
done, a rally Of few points may result, when
the BUYERS will naturally want to sell again.
When the decline in Brooklyn was stayed.
selling Of Manhattan and Metropolitan broke
out and the easy way these stocks went down
arouses the. suspicion that some Of the large
holders Of these have also slipped out It Is
! openly asserted-it has been for two or three
weeks-that one Of the prominent insiders IN
Metropolitan slipped his cable some time ago:
and it Is surmlsed that the persistent rumors ~
Metropolitan leasing Manhattan Of combina-
. t!ons 10 be then made with the Brooklyn Com
pany. and a grand union Of traction interests
thereby effected, were in fact set afoat 20 help
the marketing OF inside stock 1t IS even hinted
that some negotiations started with the Brook
lyn Traction people were entered into solely az
/, a blind
While the Brooklyn affair made trouble Tor
all the Flower stocks more or less. and began
. to shake the Industrial list; the disappointment
l. over the St Paul dividend shook the railroads
The expectation, sometime INDUCED in. that
something extra might be paid Rock Island.
T. had died away as the stock slowly sagsed IN the
T. market: but that an extra dividend would be
paid on St Paul was looked for almost as a cer-
l. tainty Suspicion that there might be none
10 was aroused when block OF the stock was un-
= loaded by a we'll known bull operator. breaking
q. the price from 135 to 13l; but the price rose
again a couple Of points or more and held rgh'
up TO the time OF the declaration Even thei
+ there was not much selling. but the feeling o
d encouragement was deep. II was argued thai J
T. the ST. Paul directors considered II the Wlses
thing to do was to hold on 70 the money az thi
time they must be reckoning on a falling OF
T. in earnings before very long. Whether this b
the real reason not. the Street saw St Pau
above 1870. the directors declining to raise th
dividend above per cent and money at 6 to
per cent The combination was not one 10 IN
spire immediate bull feelings on this an
OF the other railroad stocks. The market ha
declined" said one operator yesterday. who's
inclinations are toward the bull side; but d
p" you think It is time to start a bull movemen
e. with ST. Paul at 12S. and money 70 pc
= cent?" This query will apply 10 other railroa
stocks
AS to exclusively cliqued stocks, the DANCE
that besets the trader in these was evidence
e. last Tuesday morning. when Tennessee Goa
L. having closed at 12la found no better bid a
the opening than par. The broker offering tn
H. stock waited. finally some one bid no. then IL:
x and the stock was sold there. Clique order
n were at once rushed I'm. and the price marke
, up. But this was a streak Of light the res
position Of the stock In the market
. The latest new thing TO make its appea ranc
on the tape Is the Flour Trust. There are bond
a preferred stock and common stock. tn
same vigorous washing which some other ne
o. stocks have been developing is apparent In thi
a word may be addressed 10 the investor
don't touch the bonds the preferred stoci
to the specuator-don't sell either common