The Washington times., 1902-07-27
Financial Situation Said to
Be Menaced by
Ventures.
WAS A FAIRLY ACTIVE DAY
Banks Drawn Upon Heavily for Funds
to Conduct perations-Inviting Fu-
ture Discomfort by Weakening Re
source-General Close Irregular.

NEW YORK. July 26.-An unpre-
cedented condition of affairs exists in the
stock market. A comparatively new ele-
meht, strong in financial resources. and
adopts In sharp practices in commercial
trading. but inexperienced in corporate
management and in financing on a large
scale, has taken hold of various railway
securities, and has stimulated market
in them to an advance in prices to q level
that has not only surprised investment
interests and brought them to the mar
ket sellers, but has induced experienced
dealers in securities, both brokers and
their customers, TO pursue a conservative
policy, and it is to &c hoped has not been
without effect upon the lenders of money
Menace to Markets.
The recently acquired enormous wealth
of the Westel multi-millionaires has
apparently not brought to its possessors
serious sense of responsibility as TO the
uses of it. Stimulated TO a high .lagree
of enthuiasm by the sudden acquisition
OF great fortunes. and by the successes
they have attained in the stock market.
at least so far as quotations are con-
cerned. the operators referred to have
engaged in ventures that menace not only
the stock market, but also the financial
situation, and without doubt seriously in
terfere with the adjustment of t1anspcr-
taticn enterprises upon lines that would
minimize friction and promote stability
of rates.
Today's statement of averages of the
associated banks is exceedingly inter-
esting and significant for the light that
it throws upon one phase of the situa-
tion. II is a most important one. since
it relates to the resources without
which it is impossible to conduct busi-
ness, namely, the funds available for ac-
cOmmodations.
Heavily Drawn Upon.
The Increase of nearly $40. 600 In
the loans of the banks shows that those
institutions have been drawn upon
heavily to conduct the wild speculation
in the high priced stocks this week.
That increase was more than twice as
large as that foreshadowed by yester-
days compilation of the known move
ments of money, being s., GA 900, and
this change. together with the expan-
sion in loans, raised the deposits to
figures that exhausted all the new re-
serves and drew upon the previous sur
plus to the extent of more than s200, 600.
This small decrease in the surplus is
unimportant by itself considered. The
significant fact is that just as banks are
strengthening their resources, partly
from unusual disbursements by the
Treasury and also by receipts of gold
from the Klondike, so that they may be
in a position to meet the drain for cur
rency to move the maturing crops that
Will shortly be made upon them, the
short-slghted speculative element re-
ferred to has promptly exhausted the
first moderate addition to their supplies
OF cash. By doing so they are inviting
discomfort for themselves and those
who are foolish enough to follow them.
Other Features Good.
The situation outside of Wall Street
appears TO be unusually satisfactory,
While there has been damage to the
crops in various sections, chiefly by ex-
cessive moisture. the agricultural out
look as a whole is exceedingly promis-
ing. In consequence general business is
good. The prospects of a heavy fall
trade are excellent and railway traffic
returns are satisfactory.
All OF this, however, is being dis
counted by rapid marking up of prices
in the stock market without attracting
support OF either the speculating or in
yesting public. There is cause for con-
graduation that the substantial condi- |
tions upon which intrinsic values are
based are sound and satisfactory. since |
they insure a good legitimate demand I
for stocks when the inevitable reaction I
from present imitation CT market values |!
takes place.
The market today was fairly active |
and the tone was strong up to the pub
lication of the bank statement South |
ern Pacific and Atchison were the lead
ers in respect to activity. and with Rock |
Island rose to the highest prices yet [
recorded for them. The taking OF profits |
after the bank statement had it's effect I
on the close and there were only a few 1
stocks whose final figures showed frac-
tional advances.
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