The times., 1901-06-26
Government Bonds.


L. S 2's. r, IoOO-So. Q. J......... r6H iO7H
L. s. 2s, c. 10000, q. J........ I)6B los
I. 5. IS, r, 1905, 9. F......-.-. log l0ga
L. s SIS. R. 1908, r. c. F....... l09 l0ga
L. s. As. 1906. q. J............-. Hex ll3ss
1 u. s IS, 1907. g. J-.........-..-- E31E ll45s
! L. s As, r, 1925....-..-........- laSz 1854
L. s. gs c, 1e25..........-....... lJo4 l3JA
L. s. IS r. I904.................. l0SA l09H
L. 5 SIS. C.. 1904, Q. F....--...... ioS4 1895
A bad slump developed in the stock
market yesterday afternoon. Prices de-
clined Sharply all over the list for an
hour or more, and at 2:3G o'clock were
| at the lowest level for several days. Be
fore the close there was fair rally, and
the last sales were at a level not much
below the opening. The slump. however,
may be said to have lent its color to the
! entire session, and il is certain that il
LETT the street in a much less optimistic
| mood regarding the outlook. The cause
! Of the break in prices, or at least the
news that accom- panied it, was the an
| nouncement that a New York clearing
/ house committee had called on a number
/ OF banks to make up their reserves i'm
| mediately. 1t was said that for several
| weeks these banks have been below the
/ lawful limit of reserves. and that the
/ clearing house committee having this mat
| ter in charge was obliged to call on them
! in very positive way to rectify the de-
| iciency. Another story was that one of
| the London banks was in trouble, but
| there was no particular reason for credit
! ing tins rumor, and the street paid more
| attention to the first story. The national
/ banks are obliged by law to keep 20 per
/ cent of their deposits on hand in cash.
/ The law reads that If they fall behind
( in their reserve thirty days they must
| then cease discounting paper. After an
! other thirty days if they have not made
/ up their reserve the bank is put in the
/ committee apparently has taken the mat
4 ter in its own hands. rather than allow
! any government interference, Which
would, of course, have a bad effect on
the financial situation. It is probable
J that nothing further viii come of the
J incident. if, indeed, the street stories yes
/ terday were true regarding il. The none
/ tary outlook is not in reality in the least
alarming. After July ] there will be a
plentiful supply Of funds, and rates are
J very certain to be easy. 1t seems en-
/ tiTely probable that the break in prices
/ yesterday was q manipulated one. on the
! strength of the financial talk. Probably
! the professionals thought ii would be pos
/ sible to catch few stop loss orders on
4 weakly margined accounts, and decided
| TO make the little scoop.
| The outlook for the market is that It viii
| be dun and with no movement of i'm
/ portance in either direction for the pres
cnt- The summer dullness has descended
I on the street Ike a pail and business is
! paralyzed. Many people are away from
/ New York and the larger part of the re-
mainder are unwilling to trade. The
I professionals do nine-tenths of the bust
ness of the exchange and they 90 not
make any attempt 10 move prices vio-
I lently in either direction, taking fractional
profits as soon as they show. Yesterday
! was an excellent example of the summer
! stagnatiOn. 1t was duller than any other
! session this summer, or this year, until
the financial furry showed itself Busi-
ness stopped entirely at times. and when
transactions were made they We're most
cautious, with 40 changes in prices of
importance. London was weak and in
the absence Of other developments the
opening on this side reflected London.
Later in the day there was slight frac-
/ tional rally, but II was even more profess
slonaI than the opening. Then came the
bank rumor incident and the decline,
/ after which followed little second rally
at the close. The market is a good
I traders market, to buy on the declines
and sell on the rallies. II offers no in
ducements to investors. In fact, prices
! are considerably higher than conservative
. people believe they should be and are
only being held UP by manipulation, if
the final analysis Of the situation were
made
AS might be expected. the weakest Sc
curltieS yesterday during the break were
the grangers and Pacifics that have been
subjected to the most violent manipula-
T tive tactics. st Paul, which a day or
two ago sold well above 1S0 broke from
IL and fraction TO 172l4 or fun points.
1t recovered only TO lHM at the close.
! Union Pacific broke from 11I24 to 100 and
closed at 1895. Atchison common. which
is selling at higher price than conserva-
! tive people believe there is any warrant
( for broke from SS1s to S52t and recovered
! to s.. The preferred broke a point net
Southern Pacific broke to $50 at one time
day.
! All Of these securities arc dangerous TO
. be long Of The insiders may be able and
( willing to boom them TO a higher level
! but in the end there seems TO be very
/ little doubt that they viii sell off badly
from the present level St Paul q year
ago was selling below 120. The company
has not increased its earnings much since
tE2t time. Rock Island now selling at los
| TO l1O, was year ago selling between 102
and 1e. The earnings Of this company
| have increased very little. Very certainly
its earning capacity has not increased
/ over 80 per cent during the past year, as
its price has. The same comparisons could
be made all over this group Of securities.
TWO Of the companies that have been
Z making excellent records recently were
badly hurt by the food in West Virginia.
the Norfolk and Western and the Chesa-
peake and Ohio. 1t is said that the Nor
folk and Western especially will be
obliged 10 expend millions OF dollars in
repairs before the effects OF the freshet
are wiped out and that in addition there
must be heavy shortage in its earnings
/ owing 10 the stoppage OF coal shipments
from the POcahontas region. Neither Of
these securities is for the moment attrac-
/ tive as a purchase. on any sharp de-
clincs however. there will be purchases
OF both for investment the prices here
are much less inflated than they are in
the granger group.
The United States Steel securities were
among the best held during the break
yesterday and they both recovered well al
| the close The common stock at one time
| reached as low as IS and the preferred
I went TO gS@s. At these levels there was
| good buying in each and the stocks re
/ covered 70 40 and 9Sfz. respectively, at the
/ close. The reason Of the strength of the
/ stocks seems to be the belief that a divi-
dend Of per cent will be paid on the
common shortly This. taken with the
fact that the company is making a good
record Of earnings. tended 10 put the
street in a goCd humor with the trust and
ITS securities. The earnings for the past
quarter are said to have been $500, 900.
This is At the rate OF Sl06 .0DG 900 annually,
or very nearly what the optimistic friends
Of the company estimated when they
( made up their advance statistics for the
a dividend on the common stock well nigh
| assured. II will be seen that after paying
the interest on the bonds of the company
$l5,000.G9 600, and the dividend on the pre-
forred stock. S35. 10000. and after setting
aside s2D,oo0.g0g for betterments. etc. ther,
would remain IN such a division about :
per cent for the common stock. II will b6
well for investors and Spectators. how
/ ever to hear in mind always the fact that
the insiders have wonderful block Of thf
common stock 10 sell Whatever may bs
the merits OF the company itself IL is net
to be doubted that there may be violent
reactions in them at times.
A little boom occurred in New York
Central yesterday that attracted consider
I able Interest The stock advanced 10 fhr