The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1902-09-28
DAY OF WIDE CHANGES
FLUCTUATIONS IN STOCK PRICES
ARE MANY AND BROAD.
Brief Help Given to the Market by the
Bank Statement-Condition
During the Week.

NEW YORK. Sept. 27.-There was a very
ieVerish trading on the Stock Exchange
to-day which seemed principally due to a
contest between opposing speculative inter-
ests. The pool operations which were re-
sponsible for yesterdays sharp upward
movements were again in evidence at the
opening. but the high prices made attracted
renewed liquidation. induced by misgivings
that the bank statement would fail to re-
veal the recuperation which was expected
yesterday. There was heavy break in
prices in progress when the bank state
ment appeared, showing surplus reserve
re-established of ss,2S6e25. The bull OPP
orators thereupon turned on their oppo-
nents and marked up prices n to 1 point
at jump, so that the level of the market
was sent back to near last nights level,
and, In some cases, above. This was fol-
lowed by another relapse which carried
some stocks lower than before and made
the closing feverish and unsettled. Louis
vile suffered to the extent Of AZ In the
late break, owing to the uncertainty
whether the minority stockholders are to be
allowed to share in the terms which it is
reported will be offered for control by the
Atlantic Coast-line syndicate. st. Paul suf-
Tered an extreme. loss of over points on
account Of denials by officials of published
reports of a proposed stock subscription
| right. The dominant influence was the
money situation. The increase of 81 79O 700
in cash reserves of the banks was a total
surprise In view of an indicated decrease of
ABOUT S,OO0.00O On the other hand the
loan contraction of $685.. 600 not as
large as had been looked for. The source
| OF the cash increase was an unexplained
mystery. A sharp fractional recovery in
the sterling exchange market, unusual for
saturday, carried rates well away from the
gold import point. The bank statement
| failed to convince spectators that the
necessity for further loan contraction has
| entirely passed.
Heavy liquidation of securities has been
Forced in the stock market this week. by the
calling OF loans by the banks to make up
the deficiency in their reserves revealed
| by last Saturdays bank statement The
market steadied and recovered somewhat
| In the latter part of the week on the hope
| that the loan contraction had been carried
as TAR as is Immediately necessary and that
| the offer of the Secretary of the Treasury
| to pay now all the government interest due
Ior the remainder of the fiscal year less
| rebate or 246 per cent, and to purchase
bonds, would relieve the money stringency.
| The stringency of the money market was
1 solely responsible for the weakness of
| stocks, and this was In part due to the
large requirements for currency and credits
| which are an incident of active business.
| Ample warnings have been uttered by all
/ competent autnOrltleS or the conditions
which were precipitated this week. and the
! lack of sufficient resources to carry through
| the large speculative commitments in the
| market has been clearly foreseen, without
| affecting, however. the confidence of the
| speculative contingent that means of relief
| would be forthcoming. This contingent
has claimed that the United States treas
| ury would be bound to afford ample re-
| lief to the money market: that a rise in the
| money rate would Immediately bring in
| gold, or that the supply of money in the
a hot thn trGtf-
| al demand on New York for money to move
| the crops would be RENTED this year. The
fact was ignored that all legal means Of
| returning government funds to the money
| market require the security of government
bonds, and that the available supply of gov
| eminent bonds has become so depleted that
| the banks are not able to increase their
| holdings for the purpose of placing with the
government as security. The well-adver-
| tised fact was also ignored that the obli-
| cations OF American borrowers to foreign
| lenders were already so great that imports
| of gold must necessarily represent bor-
rowings, for which a price must be paid
| The one point of view of the specula-
| tors was that the country was in a condi-
ton of unexampled prosperity, which prom
| ised continued demand and increasing
| value for securities. Powerful combinations
| of SPECTATORS, some of them commanding
all the way from $4,000 900 to $50 600 900, ac-
| cording TO competent estimates, have long
been engaged in taking on all the Stocks
| they could carry with all the money they
| could borrow. The cheapness OF call money,
| pending the season of active demand for
| funds, stimulated this disposition, although
| this receptive cheapness was in itself due
to the expectation of rise in money rates
| for long periods and the desire of bankers
to keep their resources in readily available
form. The large holdings of stocks thus
| taken on had the natural effect of lifting
| prices of securities, but they were not taken
| with the purpose of permanently holding.
| but simply on margin to feed the more sub
| stantial investment demand expected to de-
| velop. So long as the banks left the credits
undisturbed with which the pools held their
| stocks, this condition might have been
| maintained indefinitely. But the deficit in
| bank reserves developed last Saturday and
| the inability to replenish the cash so as to
| make good the deficiency left the banks no
| alternative but to demand the repayment
| of loans. The high money rates which re-
| suited tempted depositors of all classes to
| draw down their deposits to place them in
| of accepting the comparatively meager in
terest paid by the banks on deposit. The
| banks were thus compelled to extend the
process of calling loans, and the money
| market was thrown into disorder.
| The process of actual depletion of re-
serves has, meantime. continued though in
diminished degree. The governments GUS
| toms returns have continued to run over
| a million dollars day, practically all OF
which are payable direct from the New
| York banks into the subtreasury. and the
| demands from the interior for purposes of
the circulation have continued. Only In
| ternal revenue and miscellaneous receipts
| and these are running light. The stringency
| of money has caused some weakness of
foreign exchange, but has not depressed
the rate again to the gold import point.
| 1t has been the experience with former
| offers by the Treasury Department to an
ticipate government interest that they
| brought little response from bondholders.
1t is considered improbable that the banks
will put out again in the stock market the
loans which have been recalled from Lon
| don this week. For these reasons the
opinion over the future of the market and
it's effect on the stock market is still un-
| certain.
Speculative bonds have been freely sold
| during the week and some high-grade bonds
| have also reflected pressure. United States
| twos, threes and fives and the old tours,
coupon. advanced Il and the old tours. reg
| ular, u per cent, as compared with the
| closing call of last week.
The following table shows the range of
stock prices on Saturday:
IGranger Farwell & Co.'s Telegram