The Houston daily post. [volume] (Houston, Tex.) 1886-1903, 1902-10-27
THE FINANCIAL SITUATION
STRENGTH OF STERLING EXCHANGE
DUE TO EUROPEAN PAYMENTS
Has the Effect OF Keeping stosks Down,
Money Outlook Enooursono-PIans
Of the Beet Trust

49, ~NSi tfhoNs
New York. October 25..Nev YORK avn.
dictate bankers have paid OF over SeS.ooo
coo of their outstanding Indebtedness 20
Europe during the last six weeks, which
accounts for the unusual strength az
sterling exchange at this time OF the year.
But SO urgent has been the inquire Tor
commercial bills that the exchange rate Is
now close to the noint at which GOLD can
be shipped without loss The stock mar.
Get has been heavy at times drtlng the
last week because " fears that We are 70
lose considerable amount OF the yellow
metal. u Is a fayorite saving OF the bears
that stocks never 20 M while gold is ieav.
INK the country. This Is not lnvariable
true. When shipments were made IN pay.
meat for the American subscriptions 70
the last issue Of British consols people
paid but little attention 10 the incident
and stocks behaved In much the same way
as before. Under present conditions. how
ever the New York banks can M afford 10
lose any Of their cash holdings The emer.
geucy into which they had fallen was illus
trated BY the necessity OF Secretary Snaw
coming to their relief hy the purchase ~
government bonds
The S25.Ioo.uOO above referred TO. which
represents debts Incurred hY the syDdi-
Gates in putting through great comhina-
tions and for which they needed foreign
capital. is only q sinall BART OF the ohliga-
lions which have got 10 be paid sooucr
or later aud which have been postponed
from month 10 month because Il was In
convenient TO meet them before rhcy
amounted last summer 10 between $500 o.
coo and S3o0.o0o.0O0. OF this amount tho
loans incurred In connection With the
Northern Pacific stock purchases BY the
rivaly syndicates Amounted TO fully Si0s-
0O0.00o. Some of the last uamcd have heeu
taken up and replaced bv other loans Oh.
tanned IN the United States but II Is be
lieved that more than half Of that
amount remains abroad. They have been
extended now Tor some elchtcen months
aud the Englishmeu are getting restless Tor
their money. They forced some ~ the
American operators, including John w.
Gates, to withdraw the bulk OF the stocks
which hsd been carried IN London hcrausc
money WAS easier there than here aud be-
cause the surplus reserves Of the local
banks would not permit OF further cNpnn.
sion Of stocks. 4 large mart OF the 10000
shares Of American stocks sold during the
last two weeks, aud which contributed 10
the necessity OF paving up at once some
OF the money borrowed from John Bull
represented liquidation hy the Gates pool
of It's holdings on the other side,
LIVERPOOL TO DRAW or NEW YORK.
The immediate cause OF the high OK
change rates Is that Paris bankers, for
some reason not yet explained, are
Strengthening their reserves and are with
drawing large amounts OF money which has
been loaned out in London. London has
had but little available money and had to
fall back ON New York. Expressed IN
other words, London sold reams Of Ameri.
can stocks In order to obtain the resources
to make good the French demands, and as
the securities have been shipped TO this
country the money has TO be returned for
them. According to leading foreign bank
or living In this city. the international
money situation Is likely 60 attract a good
deal of attention from now until the end OF
the year, aud II his predictions are cor
rect there may he a money pinch IN Lon
don before the worst Is over. lie said.
''Ihc International money outlook FOR th'
next two or three months Is not encourag
ing, and | fear that our money mnrke
may be more or less anected. the traupl,
viii come in London. where there are no
resources enough to meet the early demand
which Will be made for interest, diylden'
and other requirements. England IS sufrcr
ing from the serious drainage on her wealll
and industries during the Boer war, ans
there are evidences on every hand that l
| viii be a considerable fine before the Of
| fects Of the war wear of. Many klnd
of business have suffered, and under IN
weight of additional taxation London hnd
It hard to rally. The Iransvaal loHn wa
| postponed for the good reason that Il cOul
not have been noated at this time cXcep
at Tldlculously low rate, which woui
/ have been undignincd for the English IA
| ten. with the outstanding cons0g scllin
! below "a the new loans would hardly hav
| brought more than 30 to ~ who know
! but II would have gone begging az tines
! nguresY / doubt that investors on IN
other side have the avilahle cash 10 tax
| up n new bond issue,
"Of course the United states feels IN
! e1ect OF the inertucss ut Great Britain
| and there Is no wonder that foreigners cor
| tinue to sell our securities. II would no
| he strange II there was a money pine
! when the time comes to raise the monc
| for the Janary ] interest payments IN hu
| gland. Berlin may also have one OF II
| periodic 'eQucczcs' ut tho same time. A
/ the same time IL Is encouraging to rcat
| that the business conditions IN the Unite
! states are very satisfactory and after IN
pressure abroad Is over ! expect to sec ~
| financial situation here brighten measure
biz In tho meantime, ! look 10 sec NOR
| or less irregularity In stocks and IN intel
| est rates Probably money VIII continu
| fairly stin during the remainder Of IN
| year"
very curious state Of affairs has d,
veloped among the small banks and othC
| institutions throughout tho eastern part r
| the United states which has impaired the
| facilities Tor extending accommodations I
! the merchants upon whom they depend n
!
bankers months ago secured loans for the
operations IN hundreds 0f small cities pm
| ting M various new shares, ana honf
! such as those ~ the Northern Secuuut
| company as collateral These loans wei
on time at nbout per cent Interest. on
many Of them have o considerable peri0
| 70 run yet About ail OF she aYaiHb
I funds Of some NJ the New England institi
tons were thus absorbed and when the
customers came down upon them for accou
m0ddtions they had 10 fan back on the
| Nows York correspondents for help. ~
latter replied that no money was nvaiian
here and they could moi assist their neig
bors Of the inferior The New York han
| ers explained that they needed every dolls
| 20 maintain their own reserves. after sem
Ing 10 the West the money required r,
I moving the crops Now, some very mar
\ words are uttered hy the Eastern count
/ bankers against their New YORK brethrel
some going so far as 20 hint that ~
Morgan had taken their money Of 3 p'
cent and that he was turning II over
double that rate OF more.
PLANS or TIE BEEF TRUST.
Tho most interesting deal that is now Z
the cards relates TO inc plans Of the me
who control the beef trust for extendil
their power over many other penshaD
forms Of food. something has already bee
said about thelg grip on the butter, e
and poultry trade and how they have use
their resources to force the railroads
name any rates thar they saw ftAThe NO
recent development - the RAPID establish
meut OF stations M many parts Of the coul
| OK E4Wnfallire IgT NlIl