The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1901-10-07
REVIEW OF WALL STREET
BANKERS DISCRIMINATION AGAINST
INDUSTRIAL COLLATERAL.
Public Interest in the Published
Statement of the Steel Corpora
t~ion-Money Outlook.

NEW YORK, Oct. 5.-The holiday in
London to-day a%ccentuated the dizziness
here and tended TO relax the selling pres
sure, as London has been a constant seller
in this market of late. The fact that there
is no loan market at the Stock Exchange
on Saturday also tended TO relax the
pressure upon the market. Perception is
growing Of the fact that the question of
the effect of the interior demand for money
on the stock market has passed the stage
or argument and has resolved itself into a
question of how much further stock mar
ket liquidation may have to extend. While
there has been no s~tringency of money
during the week this is due to the fact that
in reducing their outstanding loans bank
ers have been discriminating against in
dustrial collateral rather than making up
the ruling rates for call loans. Owing TO
the continued frmness OF sterling eX-
change, in spite Of a larger supply of cot
ton bills this week, relief by gold imports
does not appear imminent. Demand con-
tinues from bankers short of exchange,
and experts in that market declare that a
large short interest remains to be covered
during November. 1t is said that some
fresh sterling loans have been negotiated
this week. The loan increase in the bank
statement revealed that other forces are
still at work in the credit market which
offset the stock market liquidation. This
and the renewed pressure against Amalga-
mated Copper depressed the whole market.
There has been some irregularity in the
stock market from time to time during the
week and dealings have been on a small
scale. The course Of prices in the main has
been downward and the weakness increased
during the latter part of the week. The
support of the market at the weak spots
which was a feature during the crisis fol-
lowing the assassination of President Nc
Kinley, and which was attributed to the
joint efforts of the great banking and inan-
cial powers Of the country, has been con-
spicuously lacking. a feature of many of
the railroad reports coming to hand, both
for transcontinenta and the trunk lines, is
the fact that increases in net earnings are
achieved on a somewhat lessened volume
Of actual tonnage moved. This Is a practi-
cal demonstration of the healthy effect of
the maintenance of freight rates and re-
fleets the progress made in the community
Of interest as g factor in suppressing the
rate-cutting, which has made such inroads
upon railroad earnings in times past. On
the other hand, the reduction in the freight
movement is not an entirely r%eassuring
fact. In part, this condition is due to the
higher grade Of much of the freight which
is moved arid which is a natural conse-
quence of the prosperous conditions of the
country. The eastward movement of agri-
cultural products shows a falling off, partly
owing TO the shortage of the corn crop and
the holding back of cotton. But the west
ward movement of merchandise whose
classification is under higher freight has
continued at an unprecedented volume.
While this condition has served to sustain
railroad earnings, IL is obviously not a self
perpetuating condition., as it is in effect due
TO the enjoyment of past prosperity. In the
steel trade the reports are of excellent con-
ditions, following the settlement of the
labor dispute, with large new demand in
filling belated orders, and with a large res
idue of steel rail requirements thrown upon
next years production by the mills.
The statement of monthly net earnings
published by the United States Steel Cor
poratiOn upon the occasion of the declara-
ton of the regular quarterly dividends
upon its stocks is considered cOrroborative
of the healthy condition of the steel in
Gustry. which is regarded as an index of
the business condition of the whole coun-
The withdrawal of artificial support from
the stock market, however, revealed some
disturbing conditions as to the status of
many stocks which had been most subject
ed 10 manipulation. Some of the minor rail-
road stocks which had been subjected to
operations by speculative pools suffered
wide relapSeS, but the most striking effects
were shown in the long list of industrialS.
Attempts TO market some of these stocks
resulted in a collapse of their prices into
fragments. Several factors combined to
awaken the latent distrust with which
these securities are habitually regarded,
and which is reflected in the low prices at
which they sell, compared with the rate of
dividend return. The nominal cause was
the declared constitutinality of an anti
trust law of New York State. which en-
phasiZed a growing dread of attack by
federal legislation. The collapse Of the
stock in all copper earlier i'm the month
has caused increasing attention to the lack
of public information regarding conditions
of other industrial corporations. TIL action
Of the United States Steel Corporation in
publishing q statement of monthly earnings
opened up the necessity of other corpora
tons following suit. Yearly reports of
some of the minor companies recently have
shown declines in net earnings and resort
to the surplus TO maintain dividends. The
whole question of overcapitalization and
ability to continue dividends in any but the
most prosperous times have received re-
newed attention, and parallels are drawn
with the experiences of railroad corpora
ions under the earlier financial methods
Of the country, and the bankruptcies and
reorganiZations in reaching sound condi-
ton of organization. Money market condi-
tons have continued favorable, but the ter
minatiOn of the interior demand for cur
rency is awaited to insure future condi-
tions.
Railroad bonds have been dull and irreg-
ular. United States threes declined 33s, the
nVes y and the new tours 1 per cent. The
%refunding twOs advanced "a over the clos
ing call of last week. Following are the
- - I nA1 -