The Montgomery advertiser., 1901-05-11
WALL STREET REVIEW
RAPID pFo.2ESs IN RE-EsrAB-
 LISHING CONFIDENCE.
Rebound Was to Be Expected, But the Extent of the Recovery Was Surprise to the
 Traders.

was made in re-establishing confidence on Wall Street today and there was a natural rebound in prices. The fact or the. rebou nd was very natural after the extent of the declines of yester- day, but the range of the recovery was surprising. Large progress was made toward wsping out the net losses which remained last night after the recovery had already set in on the exchange. In number of stocks which were not actually affected yesterday today's price rose above Wednesdays closing and in Missouri Pacific yesterdays net loss was recovered with three points to spare, the extreme advance reach ing 15 points. There was a good deal of trepication still over the vague dread that there might be Stock Ex- change houses which would be unable to meet .heir obligations after yes- terday's drastic experience. The mar ket was therefore unsettled and fever ish after sae strong opening, but when the officiai announcement was made that the clearing sheets of all the mem bers of the Stock Exchange had gone through the Stock Exchange clearing house perfectly and that all their checks had been honored, a feeling of relief was manifested and steadily grew throughout the day. During the latter part of the day there was a re- sumption os what looked like a spec ulative movement for the rise led by Union Pacific. The buoyancy of this stock and the accompanying strength of the Southwesterns was based upon rumors and assumptions of the bene- hts to accrue to Union Pacific from a change in control of Northern Pacific, which was still stoutly claimed by the Union Pacific party. Undoubtedly there were gery many speculative los CTS of great resources in the collapse of Thursday who retained their nerve and determination and who set about to recuperate themselves by new spec 'ulation in the market. Other buyers were those who had gotten out early in yesterdays slump and who still saw a profit in getting back at the prices ruling today. The bargain hunters were also on hand in considerable force. and there were many cash transactions both in bonds and stocks representing their purchases. This outcome of af- fairs was pretty well assumed when the news was learned this morning of the settlement effected with the shorts in" Northern Pacific on the basis of $50 per share. This removed the over shadcwing fear from the market and the quotations for Northern Pacific on lAC bakV AL 1Ou btill dlidyeu IUG apprehension. The stock sold at 200 for cash afterwards. but the progress of the settlement with the shorts at the offices of the conflicting interests in Northern Pacific prevented any fur ther disturbance on that ground. The measures taken by the banks which placed heavy loans in the market yes- terday and their decision not to call the loans today completed the tran utilizing influences The market closed strong at the top with. feeling of relief over tomorrow's holiday. The gain extended in Union Pacific to g, solidated Gas, Is; Burlington and Amalgamated Copper, 12 1-2; Interna- tional Power, Il 1-2; Baltimore and Ohio, Il: St. Louis Southwestern, pfd., 10 If; Sugar, Delaware and Hudson and General Electric, 10, and represent. atives of practically all the important groups from 5 to 10.
 Bonds, which were weak yesterday. showed some wide recoveries, but others were weak. Total sales, per value, $5,9S0,000.
 others were weak. Total sales. par cent on the last call.
 Wall Streets speculative bubble, which has been in course of imitation AOL "CChSs pliChCu lllS week anu the irridiscent hues of stock gam- blers' winnings disappeared with a per in a cloud of spray. Even so soon as this, the fact emerges that the vanishing spray represents principally these speculative winnings, while the solid earning powers of reha abilitated railroads and the prosperous business and trade in all branches is not ap- preciably affected. AS is the case with all booins, the collapse was caused by an accident. This was the corner in Northern Pacific which has emerged from its mysteries and stands disclos- ed to public view in it's principal facts and bearings. It is the nature of a speculative boom that 1t contains with in itself no corrective force, but rather the material for its own growth and excess. Buying for a rise in itself in- duces that rise and furnishes the pro- fits for renewed buying and renewed advance until the world joins the gathering horde of speculators to share in the sudden fortunes and all availa- ble credits are drawn on to secure hold ings Of stocks. None of these hold ings are to keep and the only incen- tive to buying is the hope of further rise. When an accident happens to endanger the continuance of the rise the demand therefore ceases absolutely. When holders attempt to sell first to take profits, then to save losses, there are no buyers. Prices decline and the credits cn which holders depend shrink and they must sell. The shrinkage of the value of securities endanger the safety Of loans for which they serve as collateral, and bankers must be repaid. Money must be had on terms to avert ruins, stocks are sold without regard to price and a species of panic ensues. That is what happened this week on the Stock Exchange. The remarkable feature of the collapse of fictitious values Is that 1t was precipitated by the very operations upon which the boom was largely based. These were the plans working out for consolida- tions of railroad securities and fur nished the great incentive to the vas. speculative buying. One railroad stock after another has risen in price by wonderful leaps and bounds, under the influence either of actual negotiations for absorption and consolidation, or of rumors of such negotiations. No later than last week Union Pacific was rushed up to 133 per share on the be- lief that it was to be absorbed to form a link in tranS-continental railroad system. The similar movements which had previously occurred in Northern Pacific, Burlington and St. Paul gave the speculators the utmost confidence in following the movement which marked another of the comprehensive advances in the general level of prices for railroad stocks. which was building Tn fortunes for fhp luCkv OnaS who