Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1901-05-10
UPS AND DOWNS.
CONTINUED from page ~

in the bond market where all grades
Of bonds were offered on a declining
scale. The sacrifices there were nat
urally much less than in the stock de-
ncrtment of the market. After the turn
in the market came. which II did
about noon, it was noticeable that the
selling of bonds still continued and this
was explained as being due to wish
10 secure funds to buy stocks at the
attractive level of prices to which the
market had fallen. In fact the bargain
hunter was on hand and alert for the
flrop in prices carried stocks of many
substantial properties down to a level
at which the current rate dividends
p:id make them attractive invest
nents.
1t was very notable fact that
throughout the most acute periods of
today's disturbance. there was MOTH
ing heard to indicate doubt of the
sound and prosperous condition of in
dustry and business at large in the
country. The stock market collapse
was attributed exclusively to over
speculation and an over-eXtension of
credits. The shock which caused the
collapse was the Northern Pacific COR
ner, without dispute.
The decline once in force gained sum-
ulative strength. Spectators margins
were wiped out and brokers had 10
sell the securities placed with them as
collateral to save themselves from loss,
thus adding to the weight of the sell
ing The shrinkage in the market value
of securities placed with bankers as
collateral made it necessary that they
call the loans with which the specu-
lators were holding stocks. With their
credits thus reduced further sales OF
stocks had to be made and so it came
from every quarter.
The Importance attached to the
Northern Pacific episode was made
clear by the eagerneSs of all classes to
learn ell Developments concerning it
and the Immediate effect of any an
nouncement regarding it upon the
stock market. The upward shoot to
1000 n share was the cause of the great
est decentralization in the market. The
announcement later in tho day of the
measures for the relief of the short
eyes and the relapse in the price of
the stock to 500 allayed the democrat
ization almost Immediately. Announce
mentS by ]. P. Morgan & Co. and
Kuhn. Loeb & Co. who respectively
represent the two contesting parties in
Northern Pacific that they would not
require deliveries of the stock. today.
meant n respite of one day at least
from ruin for the shorts in the stSock.
Later in the day Street & Norton an
nounced that they also would not re-
quire deliveries Of the stock.
1t was significant also, that. although
the parties TO the contest for control
showed their willingness to relieve the
shorts by romitting the requirements
20 deliver stock. they failed to come to
any mutual agreement to loan the
stock such as was proposed by one par
ty, last night. The surrise seems war
ranted from this unwillingneSs of Ell
Their party to let any of their stock
get out of their hands even to relieve
the shorts that there was continued
doubt in the minds of both as to where
the actual control of the property lies.
The hope of relief from the condi-
tons prevailing on the Stock Exchange
today, centered in the possibility of a
settlement or n compromise between
the contending interests as to sharing
the benefits Of the Burlington deal.
which is expected to be in the form
which the compromise will take. Clear
intima lions were conveyed, today. ap-
parently on authority that the figures
at which Northern Pacific sold, today.
were far above any terms which it
be thought of exacting from the shorts
to the final settlement.
RumOrs were very persistent that
many prominent houses had been COM
promised seriously by the violent
slump in prices. All of these specific
rumors We're emphatically denied on
the direct authority of the parties af-
fected. But so violent collapse in
prices as occurred, today. necessarily
involves enormous losses somewhere
The situation was still felt to be suffi-
GENTLY serious after the closing of the
days market to constitute the heavi-
est moral pressure upon the great
financial interests whose conflict pre-
Cipitated the crisis. to adjust and COM
promise their differences and conf
dence in the future is based upon q
strong hope that some means Of doing
this will be found.
Night closed upon the cventful. try
ing day without definite settlement as
to the Northern Pacific. the centra
figure in the fierce struggle. 1t was an
ticipated that there would be an agree
ment for settlement with the short
but it was evidently not finally con
cluded. Shortly after the market CLOSED
tx was semi officially announced that :
basis of settlement had been practical
~ agreed upon and that it would b.
clinched before nightfall. At 5 O'Clock
however Kuhn, Loeb & Co.. whom TIL
street accepts as masters of the situa
zion, announced that nothing could o
would be said as to the stock. tonight
There was 4 spirit of compromise an
Cancellation in the air, but until
should bear the fruit of definite settle
ment the situation in Northern Pacfi
was felt to be q menace to the Who'll
market. Kuhn, Loeb & Co. and til
men enlisted with them in the Harri
man syndicate seem disposed to rea
sonable peace and on the outside tn
strongest influences of the fnancia
world are moving determinedly for
truce that will protect the market
avert panic and restore confidence
In addition to an arrangement with Il
shorts it is believed that the settlemeI
of the fight will also involve the futul
relations of the Union Pacific. Norther
Pacific. Great Northern and Burlington