The Washington times., 1901-08-05
STOCK MARKET COMMENT.
Continued Strength in the Face OF
Surface Bad News.
An Indication That Prices i'm Many
Instances Are Near an Investment
LcvcI-The Cheerful Side of Crop
situation-Thc Financial Outicok-

LcycI-The Cheerful Side of Crop
situation-Thc Financial outicok-
NEW YORK, Aug. 4.-The heavy at
mospnere OF midsummer has settled about
the stock market 1t is the between sea
sons period. when both speculative and
investment enterprise are at standstill.
awaiting some fresh impulse to start the
movement of prices definitely in one di-
rection or the other As always is the
case when the future is uncertain, there
are wide contrasts and conflicts of opin-
ion Anyone who set out TO discover the
prevailing Wall Street view would en-
counter every shade of belief from glow
ing optimism to rank pcssmism. The
fact that is plainest to most impartial
observers, however, is that prices could
not have withstocd the harassing test OF
the weeks extreme duliness and the un-
certainty of the outside situation if they
had not been pretty near to an invest
ment level So far the chances of a
quick profit are concerned there has been
more indictment to sell than to buy.
If stocks were held very largely by
spectators on margin. who were counting
entirely en- an immediate rise, there would
have been heavy liquidation. and coming
at time when the demand from all
occasioned a sharp fall in prices. In
other words, had the market rested on
the speculative basis it did three months
ago the conditions which have existed for
the last week would have precipitated a
collapse. The fact that the trading has
shrunk TO almost nothing, while quota
tions have held firm, is the technical IN
dication which. occurring after an eX-
tended decline. shows that the market is
on q pretty solid footing, and that it Will
henceforth be influenced more by real
and less by sentimental causes
When this position is reached it also
means that broader ideas of the situation
Will prevail in the movement of prices.
Wall Street during the last month has
steadily shut its eyes to everything ex-
cept the developments which are depress-
ing and disturbing. The one-sided view
was effective chiefly because the high
level of prices in May and June was
speculative level. and tenable only so long
as speculative confidence remained. But
with the liberal recessions from the top
figures which have now occurred the mar
ket must be governed more largely by
considerations of actual values.
How far do the unfavorable influences
which have lately preponderated in the
speculative fluctuations really affect the
corporation earnings upon which invest
ment values depend? The railroads which
traverse the corn belt will apparently
lose from third TO a half of their or
dinary traffic in corn and oats, and con-
siderable proportion of some of the minor
agricultural products, like hay and vege-
tables. AS the recent rains have assured
enough of the corn crop. even in the worst
damaged localities. for fodder. if not for
shipment to market, the probability is
that the cattle-raising industry has not
duffered materially. Prices of beef and
hog products will naturally be higher, but
their supply for railroad business will not
be greatly curtailed. II corn alone is con-
sidered the proportion of the freight vol
ume affected by the crop damage will
probably not average over per cent of
the total for the Western roads
The more serious possibility lies in the
effect of the losses by the farmers from
their corn and oat crops in diminishing
their expenditures in the Eastern mer-
chandise markets. If this were TO occur
10 any large extent, the earnings of the
railroads would be considerably reduced.
But here come in the two saving clauses.
first. that the loss of a single crop after
several years of extraordinary accumula-
tion of wealth is not likely to lessen the
farmers consumption of other commodi-
ties. and second. that the high prices for
ali farm products will, under the present
general prosperity, compensate the agri-
cultural community for their diminished
harvests. This docs not mean for the rail-
roads any help to their tonnage in corn
and other staples where the yield is short
but in so far as il indicates the continu-
ance of a high rate of consumption
throughout the farming localitieS IL is
assurance against falling off IN general
merchandise traffic. which is by long odds
the most important item in railroad earn
ings.
The regular midsummer inertia and the
apathy of the speculative public are real
ly the more important reasons why no
decided change for the better in the mar
ket can be looked for yet a while The
condition of the money market is at least
q negative factor in keeping prices down,
also. II is possible, with the heavy liqui-
dation that has already occurred, and the
rapid increase of the last few weeks in
the reserves, the local banks will be able
10 pull through the crop-moving season
without being forced to call upon their
speculative customers. But il is certain,
under the circumstances. that no fresh
expansion of speculative credits could
safely be made.