The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1900-02-26
ALL HINGES ON MONEY
MODERATION IN THE SPECULATIVE
MARKET MAINLY DUE TO
THAT CAUSE
BUYERS ARE HOLDING OFF

BUYERS ARE HOLDING OFF
The Question of the Hardening
Tendency In Rates for Time Loans
Regarded as the One Obstacle mt
This Time Against Bull Move
ment, Especially I'm Railroad Sc
curities.
NEW YORK, Feb. 25.-Henry Clews
weekly stock letter says:
The stock market displays fairly good
undertone, yet values do not altogether
reflect the real conditions, and some I'M
necessary disappointment is manifested
in consequence No matter how favorable
conditions may be, one thing is always
necessary in a bull market, and that Is
disposition as well as power to buy.
There is a reason that neither the public
nor the big leaders are just now taking
an active part; the public needing fresh
stimulus before taking on new commit
ments, and the large holders being COM
monty preoccupied with other than purely
speculative plans Men Of large affairs
are frequently so pressed by the enormous
demands of legitimate business that spec
ulative plans are for the time being
pushed aside or left to the care of minor
leaders and traders. This is remarka BILE
state of affairs-that men are too busy
to speculate-yet such Is the fact. Consid-
ering the phenomenal Improvement that
has taken place in all branches of bust
ness during the past two years, the up
ward movement in values has been only
moderate but substantial: and thus far
there have been no suggestions of the
speculative excuses which usually mark
the elimination of period Of prosperity.
The explanation of this moderation in
speculative activity is found in two rea-
sons: in the money market and in public
skepticism. The money market has al
ready proved a natural and wholesome
restraint upon ill-advised operators; while,
the public through experience and re-
peated warnings, has taken hold very
cautiously Of the tempting but dangerous
bait offered by promoters in the indus
trials. The extraordinary earnings of the
new industrials, especially those in the
iron and steel industries, are proclaimed
on every hand and in every newspaper;
but still the public refuse to buy with any
seriousness, and the great bulk Of this
mass of new securities remains in the
hands Of their original owners, which is
the safety of the present situation. The
large profits and excellent dividend pros
poets for many of these properties are
readily conceded; but it is as promptly
seen that such profits cannot be MAIN
tanned indefinitely; that they must lead to
an immensely increased output, to new
competition, and finally to normal profits,
which would mean essential loss to buyers
of any but the choicest securities in the
Industrial market. Nevertheless, 1t Is
highly probable that an attempt will be
made to stimulate these stocks into much
more than recent activity, and there is
fair prospect of success when momentary
conditions favor; for holdings in the in
dustrials are highly centralized, and
should number of the big leaders find it
to their interest to work together, they
would have comparatively little difficulty
probably in marking up values.
The most serious obstacle to a bull
movement at this time is the money mar
ket. Rates for time loans show a harden
ing tendency, which may continue for
some weeks to come. Legitimate business
requirements are increasing; loans have.
been largely expanded during the last few
weeks; bank reserves are declining, and
the treasury continues to abosrb funds
in an exceedingly suggestive manner, so
that any large demand for money for
speculative purposes at this juncturewould
materially harden rates. The most encour-
aging outlook regarding the money mar
ket is found in the Transvaal war. 1t is
quite evident that the tide has turned in
favor of British arms, and that hence
forth more favorable news can be ex-
pected from that quarter. While the
Beers are expected to put up a deter
mined resistance, an early termination of
the war seems much more likely than a
month ago. This should have an impor-
tant bearing upon the European money
markets, for the war has been costing
over $1,000 600 per week. shutting off large
supplies of gold and threatening the issue
of a big war loan with al its disturbing
influences. That the war has done so lit
tie positive injury here is a cause for
self-congratulation. Nevertheless 1t has
had a deterrent effect, and an early ces-
sation Of the struggle would have a ben
ef1cial influence here.
The railroad situation continues en-
inently satisfactory, for earnings are
showing steady: gains over the increases
of last year, and every indication points
to the maintenance of this improvement
is in excellent condition, and this week
is witnessing the largest rush Of buyers
to New York that was ever known. the
wholesale stores and hotels are filled with
representatives of big interior business
houses, who are here enthusiastic over
the outlook In the West and South, and
ready buyers at advancing prices for mer-
chandise. In the dry goods market there
is oftener scarcity of goods than of
buyers This means a large west-bound
traffic for the railroads during the next
few weeks. Last weeks east-bound traf-
fic was the biggest on record. During the
last five weeks the east-bound tonnage
aggregated 79S,O00 tons, against 524, 600
tons the same time in 1899, and 431 600 tons
in 1898. A better bull argument for rail-
road stocks could not be conceived. We
still believe that many of the medium
and low-priced railroad issues combine
the greatest profit and safety of any on
the list. There are now no class of prop
critics better organized, better managed,
in better financial condition, in better
physical condition, and with greater sta
bility of earning power than the railroads
of the United States. The high-prieed Is
sues are now so completely absorbed by
institutions and rich men, or held at
such figures that they offer no attrac-
tons to the ordinary investor and specu-
lator; but there remain number of is
sues which have just entered, or are
about to enter, the dividend-paying role,
and these will undoubtedly be the specu-
lative fayorites. Later on, when the in
dustrials have been seasoned, and stood
the stress of adversely, like the railroads,
they will be more deserving of public con-
fdence.
For the present, while we lock for an I'LL
timately better stock market, We advise
conservative action until the future of
the money market becomes more settled
The political campaign is going to be less