New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1902-09-21

The Financial World.

tainly, but with considerable dif5cult,,. o.. -
difficulty continues. The effect OF yestsrasy.-
oank statement on the country win rnost ,,L,
be seen Tomorrow morning in a eonside-as,.
accumulation over Sunday Of out of town o-.a--
TO sell stocks What 1t did yesterday wbs, .
appeared was to make every small trader -
some traders not small tumble over bts 60
In hurry; so that whereas the rnarse+ -
been quite strong previous TO its cornin. 49,,
quick reaction followed and the closing Av,-a-
had all the earlier gain rubbed off them
But the big men are rot so easily -,ovss
They have the bulk Of the stocks which are g.
most active in the market; and knowing ,sa
conditions OF general business. they regard tba
present money conditions as n merely .s
porary obstacle to higher prices So long a. !,
is only matter OF rate Of interest. thew .ss,,
to care little High rates for a time. whiis ~
money situation is Strengthening itself out a..
part Of the cost of carrying stocks which ,ss
great and still growing earnings Of the prone
ties will force higher
1t was partially because yesterdays s,,..
ment was something Of a surprise tba. .ba
selling was so sudden. The week had sta-.ad
off with little squeeze. the call rate running m
last Monday to 20 per cent: but since then rates
had worked down. and Friday nearly all
business was done between and 8 per cent
The usual rule is. that when the money narkst
acts this way. that is. starting the week hivb
and working down. the bank statement will
show an improvement over the week besore
Something of the kind had apparently been sx-
pected on this occasion When, therefore il was
seen that deposits were down. the loss OF cash
unexpectedly large and the banks below thar
legal reserve line, although there had been a
good sized decrease in loans. the Street had a
little shock. At this time last year, the surplus
reserve was in excess of % millions Now there
is surplus, but a deficiency Of trife over
S1.6OO00
This is the time for the President OF thai
western bank who wrote 10 Washington that
his bank and others out west had more money
than thy knew what to do with-to send his
loanable funds TO New York. where he can get
6 per cent on time with first class security.
We commonly hear about banks out west which
can take care of the whole crop movement
themselves.
1t was certain that the first effect Of high
rates would be to start gold this way. seeing
that rates in the European markets were so
low. Altogether about 3 millions are on the
way here. to arrive d. different dates: and the
Treasury has managed 70 get out into depository
banks some 10 millions AS the gold is still on
the water, it is now only sentlmentaIiy avaiIa-
bic The Treasury disbursements are scattered
over the country. They serve the purpose there
of relieving the pressure on the banks here
Taking the situation as it stands, there seems
nothing FOR it but for the banks 10 still con-
tract their loans conservatfvely. Gold imports
Will continue long as high interest rates rule
here and low ones abroad; the effect being TO
bring the markets nearer to an equilibrium
Discussion as to whether the law authorizes
no
Treasury to accept other than Government bonds
as security for deposits. may have influence on
future legislation II has no for practical
purposes now. 1t would require bold man IN
the office OF Secretary to depart 50 far from
precedent as to accept other than these bonds;
although a liberal interpretation Of the wording
Of the law might seem to justify IT, II appears
that precedent was one occasion depaftsu
from. Secretary Fairchild having so saved some
Peoria banks from Suspension, they lawns beeIl
drained of money by large local collections u
internal revenue. The incident brings OUT III
strong light the awkward way our treasury
system works. but it is no use. as Things ART ~
establish a commo1 rule of action
The stock r,arke: will have TO accommodate
itself 10 the money market. that is al there Is
to the situation. We know that the tning can
he worked the other way. 1t must be said. too
"a
we'll the past week after the little snake do"n
q, Monday. Despite the heavy decrease IN pans
5anosits (tbe deposits are the loanabie materiai
Of rho hanLs) and the contraction or loans lhe
r.eat,.s movement in the market was upWaru-
Some stocks have been advanced IN a way
which occasions wonder at the object OF IT,
PM for example What is the purpose y
rushing this stock at this particular uIiie ei0''
nm m 200? True it is : per cent STOCK h0"'
bI,t 196 or POO. is a pretty high figure for ]"
II the advance be made on earnings thefe
as good cause for putting up ChiO4l -,
which earns just about as mucn as 81
n tho Standard Oil people intend 10 foio" '"e
1aad Of the Rock Island party ana oriis o1
similar stock watering scheme TOT 81
The argument seems to be now 'ha' =
beive. nut up to 200 by the party IN eo'i'i0-
&c TOO high to trade In; 10 bring II ds"ih y
trading level il is necessary 70 suoStIlu-1 =.
ea,.sraI issues two or three for one TINS siNs9
,vbole lot Of cheaper material 10 WoIA
ranrasenting the original high priced ar'Ioie ,
-. :. much talk about St. Paul and MIS-
souri, Pacific being brought together iN-'
-,,,,. +r,,e II is semi-ofhcially gwen O
- ~ orrangeuents are being made 10 VIZ
- +u.o e1sterus more closely in respect u -.
e. ...arcbanos The controlling powers III 49,
oor,rariss are virtually the same NOi'--o-
81 paul is wholly with the StanoaIu Oi =. ,o-
and they are heavily interested III Mss ,.,s,
cidc 1t is also suspected they a.e -T,,hssh
hackers of Mr. George Gould III Ms - "a
-ohar,ae The latter gentleman IS q ist sinSs
faiking very bullishiy Missouri Paei u every
his return from the West He says rscalls the
30 as good as Rock Island-whicn 80. 60, once
81 Slo +het those stocks did some years a. a. the
cross each other. ard ii was sonae"Hei'
CO.'S. ..ssy situation. as
Wnen we by the bank statement. it IS n az
~ feel otherwise than bearish' "H - str,Iggle
AZ the railroad earnings, ana n,'9 -+1inrSent 10
of the managers 70 get ehI .Hs 70 Is II seems