New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1902-09-29
THE WEEK IN WALL STREET

vestors and business men in general ihe
wisdom Of having big margins was pointed out
~ this column several weeks ago. At that
time the statement was made that margins OF
from IL TO 80 per cent ought 20 be PROVIDED
but from reports made in the last week it is
evident that many traders were satisfied TO
carry stocks on slim margins. despite the known
condition OF the money market. Fearful eSecu-
ton done among the small margin traoefs
last week margin of or 10 per cent was
totally insufficient in many of the active STOCKS
as for instance Missouri Pacific, which oe
clined from the high price on Monday at H.
to a low point of 1117s on "Wednesday Brokers
are not philanthropsts. The fact that raiiS
was certain TO follow the break on Tuesday ana
"Wednesday naturally did not persuade the aver
age commission house to carry exhausted mar
gin accounts over the period of sinking values
Traders who had less than 10 per cent Insieihs
in last weeks market were generally aSheu "
supply additional funds to their brokers, ano'
failing TO meet such demands. the noloers on
margin of the more active speculative issues
were sold out" Money generally grows tsht
sn New-York in the fall. and 1T is therefore wise
for stock market traders to make preparations
I'm advance TO protect their holdings in expecta-
ton of radical action by the banks regarding
loans on stock market collateral
Stocks are worth as much intrinsica lily as they
were week ago Indeed, the movement Oh
conditions affecting the actual worth OF securl-
ties has added value to investments, as rail-
read earnings. bank clearings and general pusi-
ness affairs have suffered no adverse chanse
since the development of high money rates IN
New-York. Bank reserves at this centre are
low but prosperity continues. There is no rea-
son why good stocks should be sold al a loss
Declines made last week will be recovered, and
higher quotations will be recorded later on IN
the season. Notwithstanding last weeks course
of values. stocks in general are not Dear dt
ruling quotations. and purchases made at pres
ent prices ought not 10 be houidated at q loss
if further downward movement develops
Buyers however, ought TO exercise discrimina-
ton According to the opinion Of the best mar
ket Judges the low and medium priced railroad
stocks and industrial issues will prove the safest
nropositions as shares of this character have
enjoyed but a small proportion Of the gain 10
which they entitled by their constantly IN
creasing actual worth. No one can predict TO
certainty the course Of values. but II is safe to
assume that growing intrinsic worth VIII exert
an important influence on the securities that
have SO far failed to reach a level commen-
surate with their present real value and their
excellent prospects for still greater value III the
course Of the year.
Rates for call loans touched 25 per cent in
the week with the average at about II per
cent. Shipments OF funds to the interior were
larger than in the preceding week, while the
Sub-Treasury continued to absorb money from
the local banks. The banks were compelled TO
protect their reserves by reducing their liabili-
ties and to accomplish this drastic loan con-
traction was necessary. The bank statement on
Saturday showed reduction in loans Of over
S13 600 600 ma king since August i a decline
in this item of over S46.0ooo00. There is about
SSooo0o0 in gold. either arrived or on its way.
that will be added to the local bank re-
serves In addition, the banks are increasing
their circulation and the government is slowly
adding TO its deposits in national banks Other
factors that may increase city bank holdings
are the anticipation Of government bond in
.erest due between the present time and the
END Of the fiscal year. and the decision OF the
Secretary of the Treasury 10 buy the govern
nlent per cent bonds in the open market The
chances however, not in favor Of a large
gain in bank holdings from the last named
sources Both propositions have a string at
tached. The government will anticipate interest
on government bonds at a discount, while 1t
offers TO buy the 3 per cent issues at a price
slightly under the ruling market quotation.
The same thing has been tried before, and no
general response has been made TO the Secre
tary's offer. Holders of bonds are anxious
TO assist the New-York market by accepting
their interest less a discount and owners OF the
IS are not likely 10 accept the governments
offer Of los when they can sell for a better
price in the open market. Treasury plans
help the banks makeshifts. and there will
be no adequate relief TO the money market in
times Of stringency until the present Sub-Treas-
ury system is abolished. In the last week
Sc, 232 900 has been locked up in the Treasury
vaults on customs payments. There is no more
reason why this money should be taken out Of
the channels of trade than there would be for
the locking up Of city. State ordinary bust
ness concerns funds in vaults.
Monetary stringency will not continue for a
long period. The money market will eventually
resume its normal condition. but similar situa-
lions may be expected as long as the Sub-Treas-
NV system continues in force. Lending rates
will doubtless rule at high level for several
weeks and in that time an active bull market
for securities can hardly be expected In view
of last weeks decline however. 1t may not be
wise 10 make extensive commitments the
short side of speculation Stocks doubtless
NOW in stronger hands than ever before The
Incubation last week developed prices that ap-
r..Ied TO people who are able TO buy stocks
sight and according brokers reports,
.,o-,oous amount of stocks passed into the
hands of interests that Will not sell until values
reach materially higher level Many over
loaded pools have parted with their holdings
The greater number of small accounts have
been licuidate6 and as consequence. the mar
he, is free Of the technical weakness that ex-
listed week ago. The outlook for bull mar
ket later is promising
II is impossible 10 be pessinistic over the tut
,,ra whom all the factors in the situation are
carefully considered. Railroad earnings con-
,,nue far ahead of last years big records. Trade
renorts could hardly be better, while crop yields
a., ,be great corn and wheat belts of the West
sssrr ueal-h IN the country at large The