The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1900-07-30
LONDON MONEY MARKET
DRIVES BUSINESS
TO THE BANK OF ENGLAND.
Credit Dealers Afraid to Discount
Bills ut 3 Per Cent.-Demand of
Government for Money to Carry
ON Wars-Rntcs VIII Advance.

NEW YORK. July so-The Times Lon
don financial correspondent cables:
A ground swell of uneasiness has infiu-
enced our money market all week. sub
siding slightly toward the end. II is true,
but not really disappearing. The fact
that business has been driven to the
Bank of England because credit dealers
on the outside were afraid to discount
bills at per cent. shows how strong
the sentiment of apprehension was. At
the end Of the month we expect gener-
ally some little scramble for money, ow-
ing to our monthly bank balance sheet
arrangements. but the restlessness OF the
market had little to do with that on this
occasion.
Short credits were fairly cheap always.
never rising to more than 81 per cent.
except on Friday and Saturday, when
stock exchange payments made lenders
occasionally exact 4 per cent. Seven-day
loans rarely cost more than 3i4 per cent,
and everybody looks for greater cheap
ness when the new month comes In. yet
brokers would not discount freely. some
times not at all. at per cent. for the
first three days of the week. and dis
count business accordingly went to the
bank
This curious display OF cross currents
for the moment indicates that the bank
has been borrowing money from the mar
ket because II fears calls upon II later
and desires the market to strengthen
itself. But for the banks action credits
would have never reached per cent. and
some bill brokers would certainly have
worked under per cent. That, howevc..
Is merely temporary influence, as the
bank must again release the money 1t
gathered In and We shall be In more
slippery condition than before.
Deeper cause OF dread in the money
market is found In the fresh demands
made by the government for money to
carry on its wars. You may not remem-
Der the steps by which we have been led
into our present position. Last October
81 100000. our chancellor of the exchequer
told us, was to see the entire thing
through. BY February it became more
than twice that amount. and by the middle
Of March the demand had swollen to about
900, Now another ell, 10000 goes
on top of that, $4,000 900 of II for China
Not only has all the war loan money
been spent. but the government has had
to issue f2.0oa.0oo In treasury bills this
week, and Is nearly Esooo. 900 in debt to
the Bank OF England. besides having used
UP 10 per cent. Of the war loan paid up
In full
We feel in fog amid all these ieakages
of capital and new demands. so that fits
of nervousness in the market may be ex-
cused especially az Il will have the great
est difficulty In finding the money re-
quired
we must reeoilect that all these wants
OF the government are In addition to the
ordinary demands from municipal corpora
tons all over the kingdom from our col
onies and from India, and that quite inde-
finite possibilities OF expenditures are open
Ing up In connection with China alone.
Hardness IN money has lifted continental
exchanges slightly in our favor. but we
are not out OF danger Of raids upon our
small stock OF gold. and consequently we
must expect after little pause to see
money again advance and a 5 per cent.
bank rate aa the next move.
Such possibilities ard entanglemenis
have put an end to all life upon the stock
exchange and business Is smaller than
since before the Barring crisis, much small
err II the multiplicity 81 new securities
added since then Is take into account.