The San Francisco call., 1901-11-07
The Business Outlook.

The New York circular of Henry Clews says:
with so many uncertainties in the financial
atmosphere and attention TO business some
what diverted by the excitement of political
campaign, the time is not propitious Tor any
organized bull movement. 1t may be argued
that there is very little material for a bear
campaign and this is true, except for the high
prices at which some stocks are ruling, the
weakness of the industrials and the unsatis-
factory state OF affairs abroad These are facts
that must not be forgotten. Competitive bid
ding for control has carried some stocks many
points above their true value, rendering them
extremely dangerous TO marginal holders, be-
cause the time must come when they Will sink
their intrinsic level. Nor can the evil day
be postponed by changing per cent stocks
into S per cent bonds, cutting them in two
and selling at par These are very prohtable
transactions for some parties, but stockholders
OF the guaranteeing companies are likely to
feel the load when the period OF contraction
sets in. AS for the industrials there is for
tunately little speculation IN these; but tney
viii be the nrst and most sensitive 10 any
commercial reaction Thus far our prosperity
has been so great that We seem comparatively
indifferent TO European depression, yet II must
not be overlooked that any impairment Of
EurOpe's purchasing abilities will inevitably be
reflected here and that the continuance of low
prices in Europe and high prices in the United
States means a check upon our exports and a
stimulus TO our imports that will soon put
balances with which we have been congratu-
lsting ourselves during the past four or hve
years Already there have been symptoms OF
change in the drift Of our foreign trade,
exports having shown two or three declines
and imports a steady growth, and this TACT
was emphasized by this weeks shipments Of
gold at time when are usually importing
gold. Because of great financial strength
and prosperity il is argued we can easily spare
considerable sums for EurODe's needs, which
may be fortunately true, but il does not alter
the fact that our international exchanges are
in a less favorable condition than they have
been for several years. At present we need feel
no serious concern about gold exports. for bank
reserves win soon begin to rise and there are
no present indications of important disturbance
in the local money market. especially with Sec
retary Cages precautionary offer to buy bonds
in an emergency.
An encouraging feature is the satisfactory
condition Of general business. There no
signs yet of reaction and the principal lines
OF trade are enjoying another season Of un-
exampled prosperity This is true Of the entire
country except in the drouth district. where
corn and cotton were badly injured. The ag-
ricultural interests of the country a whole
are prosperous. Iron has always been con-
sideredb good barometer OF trade, and if this
he true conditions must be satisfactory, for
the great iron mills of the country run
ming TO their fullest capacity, with orders
three and six months ahead at present high
prices. Railroad earnings are excellent. The
percentages Of gain are not quite so large as
last year; but this is not to be expected and
certainly cannot be construed as a bearish
feature"