The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1902-09-24
LIQUIDATION IN
STOCK MARKET
Spectators of All Glasses
Threw Over Holdings
CLOSING WAS VERY ACTIVE
Growing Difficulty of Borrowing Money
- N,rr.x cno1uI,ti... IA z4-f...- -.
CLOSING WAS VERY ACTIVE
Growing Difficulty of Borrowing Money
to Carry Speculative Holdings the
Root of the Trouble-Strin-
gent Conditions in Money.

New York, September 2s.-The stock
market was subjected to drastic liuuida-
ton today and spectators of all classes
from the smallest to the greatest threw
over their holdings with increasing signs
OF disorder. There were few pauses
in the activity of the selling but when
ever the bears commenced to bid for
stocks in the fear that they were over
extending their short account. it proved
SO easy to get stocks that the offering
down of prices was constantly renewed
with constant uncoverinS of fresh
stop-loss ORDERS which tunibled stocks
upon the market In heavy volume.
The closing was furiously active and
with prices still pursuing rapidly down.
ward course. The growing difficulty of
borrowing money to carry speculative
holdings of stocks on margin was the
root of the trouble Yesterdays mod
crate calling of loans by the banks in
stead Of relieving the trouble seemed to
aggrevate it. The disturbance of the
money market was due in some part to
the operations of the forces of relief,
which were through new and unaccus-
toned channels. Thus the high rate for
money resulting from yesterdays loan
contraction offered an inviting opportu-
nifty for all who had available deposits in
the banks to draw out their deposits and
replace them on loan in the stock mar
ket This was done by many classes
of depositors all the way from those with
private accounts up to the large banks of
the interior which kept many millions
80,
process, If carried out in a thoroughly
systematic and orderly manner would
constitute simply a transfer of book ac-
counts. No increase or decrease of the
supply of lonable funds is involved, but
the deposits withdrawn from the banks
to be loaned had to be replaced by heavy
calling of loans put out by the banks.
This shifting process was largely respon-
sible for the continual furries in money
The sentiment in the street was decidedly
upset by the conviction that no relief is
Immediately available for the stringent
condition of the supply of money
The early contribution Of nearly mill
lion dollars to the market through the
sub-treasury operations was nearly wiped
out by yesterdays customs collections,
and today there was deposited at the
sub-treasury s250,000 for telegraphic trans
fer to Chicago and $4,000 for New Or
deposits by interior banks are re-Ioaned
here, other sums were shipped away by
express to meet the crop requirements
The drop in New York exchange at Chi
cago from par to zoe discount reflected the
increasing pressure upon this center for
funds. understanding the higher level
of money rates. 1t was noticeable also
that the sterling exchange rate failed to
yield to any material extent. The jump
in the prices Of wheat and cotton has
checked the export buying and the maxi
ing OF exchanges. Private discount In
London rose above the bank rate today,
and 1t is generally expected that the bank
rate will be advanced to per cent on
Thursday, and such other obstacles in
terposed 10 the movement of gold to New
York as are possible. The amount of COM
mission exacted by brokers for time loans
are growing, and there are complaints Of
scarcity in other departments of the
money market, owing to the Withdrawals
to the advantage of the high ruling rate
for call loans.
The considerable shrinkage today in
the prices of securities involved calls for
additional collateral on loans, which was
a further factor In the pressure of the
money market. The confidence in values
which has been SO persistently maintained
received a decided setback in face of
this combination of circumstances At
least one powerful speculative combina-
ton liquidated accounts to the extent of
between $4,000 and 100000 shares of vari-
Gus stocks. mostly of Missouri Pacific
One of the most important mainstays
of the recent market was thus with
drawn. An opening lift OF points In st.
Paul was the only important attempt TO
contest the declining tendency from the
start. Last prices show that the most
important stocks are from to over 3
points lower than they were last night.
The downward impulse to stocks caused
some additional weight to be given to
the report of disorders in the coal region,
unfavorable crop reports both for grain
and cotton and the strained relations be-
tween Great Britain and Venezuela, but
the money situation overwhelmed all
other conditions.
Bonds were active and weak Total
sales, par value $5.545.OOO. United States
Is coupon and the IS advanced 4 per
cent and the rs registered declined u
per cent on the last call
Maui X0rk