New-York tribune., 1900-01-14
financial.
The Financial World.

Sugar Company. What he said was 80 diDlo-
matically worded that the most alarming part
may be unworded at a later date II expedlsnt.
but the Street jumped to the conclusion that
the declaration equivalent to a reduction
or possible passing OF the dividend on the
stock. and Sugar broke over II points Tbs
general list stood the shock with surprising
frmness; but next day, when Sugar broke
again. 1t gave way. The traction stocks broks
badly, and most OF the industrials dropped
The railroads stood UP fairly well On Friday
the selling pressure relaxed. a rally followed and
continued till after the appearance OF the bank
statement yesterday. when realizing sales
checked its further advance and set II back
somewhat
The bank statement did not cause the selling.
1t was a good one But 1t furnished the op
portunity to traders who had bought al the
lower level OF the day before to market their
purchases. The statement showed that the sur
plus reserve OF the banks is growing process
which may be expected to continue for some
time So far as can be seen now, and Judging
from past experience. the money market will
continue easy we'll into March In that month.
preparations for the April settlements nav
tighten It up again. These settlements are al
ways large especially in New England Bank
ers say that no more gold exports need be looked
for at present. except some small amounts to
South America, which probably have already
been provided for. Abroad the tendency Of
money to greater ease is still more in evidence
than It was week ago; since the Bank OF Eng
land. the Bank Of France. and the Berlin Bank
have each reduced their interest rates.
At each financial centre there was as with us
a more or less severe speculative crisis at the
close OF the year. After the heavy liquidation
incident to this. the tension in the money mar
kets relaxes. interest rates decline, and money
accumulates through the general cUrtaHrnent OF
credits and check TO business. That both our
own and the foreign money markets had al
ready started towards easier conditions. was
noted in this column last week; but il was then
said that speculation will for some time take
direction from other forces than the amount OF
loanable funds available" The stock market
the past week has demonstrated this. II de-
clined most on Thursday, when the foreign
banks reduced their interest rates and when call
money here was cheapest.
Where Immediate Improvement is felt
result Of growing bank reserves, is in the bond
market. The sustaining power OF easier money
Is quickly experienced in this department, first
In checking the pressure to sell. and then in in
creased buying. In the stock market. II IS
conditioned now. cheaper money acts as a sus-
tanning force. No bull market can be made
simply out Of cheap money, which may be the
of compensation. it serves to sustain the prices
OF securities whose value may be 1essening by
reason of trade contraction, through making it
easier to carry them. Their decline is retarded.
In respect to the stock which made the hole
in the market. 1t may be said that any
who deals IN Sugar on a margin has TO sit UP
nights since margins have always had way
Of disappearing very rapidly that volatile
security. But the man who bought for keeps
has had no reason to complain, seeing he has
been receiving his II per cent dividends with
a comforting regularity. and an occasional extra
one thrown in IF conditions are the same
next March, said Mr. Havemeyer, he should
be opposed to the declaration OF any dividend
which might impair the ability OF the company
to continue its policy OF trade warfare This.
it will be seen. is diplomatic statement Con-
ditions may not be the same in March And II
they are, what Is the size OF the dividend which
may be declared and not impair. etc7 Or can
there be a dividend at all? AS the Sugar Com
pany puts out dividends only. and no reports,
there is nothing but guessing; but we can guess
pretty straight that the company has been max
ing no money for some time past. and has been
drawing on its surplus for dividends Now
since the policy OF the company seems entirely
In Mr.. Havemeyer's hands, 70 speculate what
the next dividend Sugar will be. is merely
trying to guess what Is the state OF Mr.. Have
meyers mind. or what will be its state next
March. This is blind work But OF this we may
be sure-that If 1t suits Mr.. Havemeyer's pur-
poses to have Sugar under par. 1t will go there.
Only, 1t would not be safe now or rather a lit
tie less safe than at other times. to go short
or long OF Sugar on a slim margin.
Another thing the Street interpreted from Mr..
Havemeyer's remarks-that he was a bear on
the market. It had quite effect while the
market was breaking. Then the other sugges-
ton was offered. that II he made this announce
ment now, 1t was most likely done to buy
This found favor when the rally came Thus
the traders had great time over Mr.. Have
meyer for while. which was the more inter
esting since he has been out OF sight for quite
a period.
Evidently there IS one set OF people who are
not bears-the friends OF the B. & o. stocks.
In a weak market they have been going up IN
good shape with an exhibit of earnings by the
road which, II continued. would give a good
round dividend on the common stock after pay
ing the per cent the preferred. These
earnings may not continue. OF course; but there
they are now. And in respect to trunk line traf
hc a very large shipper makes the statement
that not a shaded rate can be had on any line.
1t Is no good TO try the customary bargain bust
ness-you get the information at every Office
that the rate Is so much. for big or little. and
If you don't want to pay it, the goods can't go
This. he says, is a condition of affairs almost
unheard OF before. Obviously II continued. the
effect on earnings will be impressive.
Queer rumors were in circulation during the
week that the Third Avenue road was going TO
fall into the hands OF the Metropolitan. Strange
ly enough. they were accompanied by a ten or
twelve point drop IN the price OF Third Avenue