The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1901-01-06

creased he disposition sell and the favorable
bank statement taken advantage OF TO fur
Their unload ST. Paul reacted 5ik from the top.
New Jersey Central and Northern Pacific 81,
ana renns ~, c.,rs =, e,rt ais
Erie stocks TO 3. Baltimore & Ohio 33s. New
Jersey 24 and Missouri Pacific 1is Otherwise
there was nothing important on the side of
gains and the list presents ragged line of net
Wall street has witnessed one of the most as
during the past week in its history On Thurs
versal with the speculative public that the long
awaited reaction in stocks had been inaugurated
tablished. The causes underlying the sudden and
unprecedented recovery on Friday are not sui-
course OF prices is itself sufficient demonstra-
tion that powerful combinations of capital had
ing of wholesale amounts of stocks of various
railroads. 1t is evident, also. that the specula-
eagerly by looking for an opportunity to get
into the market at prices below the prevailing
level and their precpitate rush to buy forced
prices upward with frothy effervescence. Much
ans e 6a ob % M arse s short as tie G
which was driven to cover and severely punished
on Friday and the belief is general that the
small part in the ferocious raid made the
bears It Is difficult to give an idea In retrospect
but it is evident that very unhealthy conditions
must have permeated the market to make posi-
bic such setback as occurred, considering the
vast waiting demand for stocks. The conse-
load by the large number of holders a narrow
margin without resources to extend the margin
Re as es gaSF % se her ali ON an
uncertain risk If q possible chance is offered 10
gain sudden wealth.
INVERTED PYRAMIDS
There have been abundant indications of late
of the growth of this element among the active
forces in the stock market. These signs are
blind credulity in sensational runors on fimsy
authority and of innate improbabilty and a reck-
less indifference TO what price is paid for stocks
so only they may secure a title to them by how
ever uncertain a tenure as to the amount Of cash
paid down and the ability to meet future OBJ
legations. AT a period OF speculative excitement,
such as has persisted in Wall street for two
months past there is always a mushroom growth
OF bankers and brokers' in the financial dis
trict who use every means to stimulate the buy
ing desire. With money cheap and with specula-
tive enthusiasm prepared to buy large amounts
Of stocks and holders oath to part with them.
the rise In prices has nothing to check 1t. With
a jump OF several points in stock. the holder
on margin reads large profits already earned and
reinvests his paper profits, thus aiding IN
the airy edfce on the unsubstantial basis of his
own unstable buying capacity. The only thing
that can check this process, before it runs into
excessive initiation, is an effective relapse in
prices. Professional operators have sought, many
times. to force such a reaction. knowing well
that the mere fact of the reaction would bring
out flood Of offerings to convert paper profits
into cash or TO save losses the part of narrow
margined holders whose accounts would be closed
out with the wiping out of margins Various
causes contributed TO make effective the bear at
tack on the market this week and to force the
reaction which resulted. expected. in shaking
out liberal supply OF long stock. Probably the
most potent influence was the suspicion that
powerful and aggressive leaders whose leadership
has been followed with a blind confidence by the
purely gambling element had quietly sold out
and taken their profits under cover OF the varie-
gated rumors which have been flying hither and
thither, OF effective new plans for increasing
the value OF varotis stocks The small buying
demand resulting from The disbursement 81 jan
uary dividends and interest early disap-
pointment This was accounted for at first by
the delay in the return to the channels of the
money market Of these iisbursed funds But the
failure of this investment buying to develop
punctually in the first week of January caused
Inconvenience to those spectators who had CAL
demand, and suggested the conclusion that the
intending investors had probably been Compel
ing in the early buying by the spectators them
selves at the lower level of prices
With the reactionary tendency once estab-
their terms This was not noticeable in the he
money rate, but took the form Of discrimination
collateral for loans This increased the pressure
to sell those stocks. The advance in the Bank
of England's rate of discount had sentimental
influence. which was exaggerated in the sudden
mood of depression which seizes Wall street
Oh any considerable reaction in the stock mar
ket. International bankers are willing to admit
the likelihood of further demands being made on
ments abroad and the possibility that gold may
be sent from New York to help out the foreign
this will work hardship to the New York money
market. as the domestic supply of gold is suff-
Gent to spare a considerable amount for export.
The apprehension had been general in more
conservative quarters in Wall street that owing
to the long continuance of the rise in prices
there was danger of violent relapse when the
turning point in the market did arrive. The Wig
orous support which came into the market at the
| low level. after Thursdays sharp break how
| ever. made an impressive demonstration of the
still unsa tisied demand for stocks which seems
to be waiting for concessions i'm prices. There is
| also striking scarcity of offerings when the
holdings of the lightweight SPECTATORS are
shaken out, making 1t difficult for bear opera
| tors, who sell the market short, to get back
| their stocks. and making them open to attack by
| the still aggressive bull market. The constant
digestion Of profits is thus have conserved
| the health of the market. The resency of the
market is conclusive evidence of the large re-
| duction in the floating supply of stocks which
| has resulted from the recent sustained buying
| The large amounts of stocks which have gone
| into the vaults of bankers and great financial
| institutions for investment and into the treas
| uries of competing railroad companies for con-
| troll or to secure influence in directorates and
Arrangements are not brought the market
again even by the present high level of prices
| which. for many railroad stocks is above ali
/ previous records.
| Railroad bonds have not escaped the reac-
| tionary tendency of stocks, and have not shown
vigorous a tendency to recovery as stocks
United States twos declined l. United States
tErees, coupon, 112: United States threes regis
| tered 2; refunding twos. rs. and old fours and
| fves "a below the ruling bid of a week ago
Following are Saturdays share sales and the
-