The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1900-07-09
UNCOMFORTABLE CHEAP
Is the Way the English Money Market
is Described.

New York, July 9.-The Times Lon
don financial correspondent cables:
The English market has fallen into a
state of uncomfortable cheapneSs which
may have an unpleasant ending.
Thanks to the necessities of the gov
eminent, bankers have been deluged
with credits originating in its borrow
ings at the Bank of England. These
the week before last amounted to G5,-
500. GOO part of which was disbursed be-
fore dividend day.
Dividends, British and Indian, came
out on Thursday, and Immediately all
the balance of the markets borrowings
at the hank was paid off, while at the
same time short credits in the open
market fell to 115 and 1S4 per cent.
Generally speaking, cheap floating
credit brings low discount rates, but it
has not been so now. Such is the ner-
have actually raised their quotations
since money became over abundant, and
on Friday and yesterday quoted 80 day
RENTED paper at 25s to Pa per cent.
There are reasons in plenty for this
nervousness, not the least cogent of
which is the persistent export demand
for gold. Not only is the gold that
comes into the open market snapped up
by the foreigners, but small parcels
daily leave the bank for Paris. The re-
suit is that we enter the second and
trying half of the year with only $780,
coo more visible gold in stock than we
had at the beginning of January last
Something must be done to stop the
export and attract the metal if the
storm is to be STAYED off in the autumn,
and therefore discount houses have be-
gun to struggle against the deleteriOuS
influences of cheap credit brought into
being by the profuSe war expenditure
of the government. We might hope
that something would be done by the
payment of the Khaki loan INSTALL
ment next Tuesday to Stiffen the short
loan market and SO help the brokers'
hrrf f.1rv 81
war have caused this money to be an
ticipated, and what we are much afraid
of now is the issue of yet another loan.
Provision for a campaign IN China may
be given as an excuse for fresh de-
mands, but South Africa will take a
heavy share in what may be going. No
sooner therefore is the open market de-
nuded of the credits poured into it by
the treasury than fresh payments flood
it again, and all the time it is being
forced toward a crisis.
Abroad the tension is less, especially
in Germany, but thanks merely to lib
eral resort to the over issue of paper
money, and experienced bankers are
apprehensive that the German empe-
rOr's ambitious Chinese war programme
may place an unbearable strain on the
Berlin market Even Paris is not al
together comforta BILE, but the very uni
versatility of apprehensivenesS may
avert anything more injurious than
convulsive spaSn of stringency.
Already the beginnings of such a
spasm have darkened the trade outlook,
and I am unable to report anything
cheerful about British commerce. Ian
caShire has been suffering for some
time through the Indian famine and
plague, and now the Chinese embroglio
is sending depression into the wooden
and metal trades. With all this coal
keeps extremely dear, to the curtail-
ment of profits, and our railway stocks
have been falling because spectators
expect reduced dividends in spite of i'm
proved gross receipts.
On the stock exchange one hears
nothing but growing, so that members
welcome a holiday such as they had
yesterday with shouts of delight. Even
the investment business cannot make
both ends meet, and the very lingo
signs for peace.
The best opinion here leans to the
view that the scare about a shortage
done, and prices on our markets tend
downward.