New-York tribune., 1902-12-21
finarrinl
The Financial World.

market has been improving and had scored a
considerable advance by Saturday. As no new
money was brought into the Street by the opera
tions of the pool. it has been facetiously called
a faith cure This is true in a measure There
are some mountains that faith can move and
some that it can't. The particular mountain
that faith moved on this occasion was the one
called Fear.
The working OF the cure was something like
this: Suppose that A had. say. a sterling loan
coming due about this time, which he had good
reasons to fear would not be renewed The
situation was an anxious one for him, threaten
ing forced liquidation. When the pool was
formed. his anxiety disappeared with the
knowledge that he could go to the COMMITTEES
with his collateral and renew the loan there
At the same time. the knowledge the part
of the lender that this could be done. would
most likely make him willing to renew the loan
himself. Thus the pool would not be called upon
TO lend at all; and this very clearly antici-
pated by the men who got it together; for IL
was asserted at the time that while 80
millions would be available. probably not a
fifth part of that sum would be actually loaned
Then. as the Chronicle points out. 1t was
pooling OF the resources of the banks under the
control of a single head. and therefore much
more effective for it's work than II these same
30 millions had been scattered in as many
banks each working independent of the others
The net result that the money market
began to work easier at once. and the dread that
there might be a bad time at the January settle
meats disappeared. Time money, which was
almost unobtainable, is now again to be had In
comfortable amounts The rate is still stx per
cent; but the money is to be had at that rata. In
stead of at any rate.
Another thing that helped. the break IN
foreign exchange. The first weakening was made
through a prominent banking house selling 10
millions Of Pennsylvania car trusts abroad This
was actual sale. Besides. there were other
amounts of bonds sent over all sales outright
1t is understood also that some few millions
went over as collateral for loans. To the weak
ening of exchange from these sources. there was
added that coming from an increased export OF
commodities cotton especially now going over in
large volume
It may be objected that the money pool should
have been formed before, and not deferred till
the market had been put into a position Of forced
liquidation To this it may be replied that it Is
very unlikely it could have been formed at all
until that liquidation had taken place The risk
would have been too great 1t was we'll known
that there were large accounts which had to go.
and the men who got up the pool preferred to
take action after these were safely out OF the
a trick, OF IT may be called self-protection; but
at any rate there was necessity for considerable
precedent Iiquidation il the pool operation was
to be really effective for its purpose; namely, to
safely bridge the market over the close Of the
year.
II was lucky the thing done when u was,
for il the Venezuela incident had been added
70 a nervous tension on the money SITUATION
Wall Street might have been reminded or the
original Venezuela panic in a most uncon1forr-
able way. The pool operation so far relieved hs
one that the other could be taken coolly. Il
looks as if that thing were safely over now;
but one cannot be certain where there Is 30
much infiammabIe material. The tendency Of
so many people-and people far above the class
the yellow journals appeal to-to bristls up
whenever they hear the magic words Monros
Doctrine, is a fact to be reckoned with There
is no place where it has to be reckoned with
more circumspectly than in Wall Street. We
have been taught that costly lesson The fact
that since the days OF Monroe. the United States
has grown so rich. so big, powerful. that It's
position among the nations is the diferance
between a boy and man Of giant strength
seems to bring these people none Of that easy
Indifference which the giant is entitled to enjoy
by virtue OF his being such II there II one
thing more certain than another, ii Is that tners
is no one in Europe-not even the German En-
peror-who IS going out Of his way to interfere
with the giant: whereof the proof may be seen
in that even on a debt collecting expedition.
England and Germany first laid their plans De-
fore the Administration at Washington But
long as so many people believe the other
way, and are ready to put on paint on the
slightest suspicion. Wall Street has to take
note Of the fact Meantime. there will perhaps
- rra iriO
uela is an international nuisance
Assuming that We are to get further trcu-
bic from that quarter, the market seems now III
a position where il is safer to buy on declines
than sell on rallies. 1t has been safer TO DC tns
other thing so long that the traders have s0O
in the habit of it. and there is not much dou0-
that a good sized short interest exists ID Inc
leading speculative stocks Loa1ing rates on
some of these yesterday indicated a more Ut
gent demand for stocks to borrow. tnan iOt
money. The real extent Of this short ln1erss1
will probably be revealed early in the conins
week
OF course the men who put together the mono'
pool did not neglect to turn an honest penny Os
buying stocks as as they were sure Ni0
combination could be made. The steels Wele
general favorites, the common being the NAN
trading stock because of its low price AH
purchase by the corporation Of the Union O"A'
pany could not surely be said 10 have much piO
moted the buying, because opinion in the o're
was paIpably much divided as TO wnelner =
was good bargain or one OF these transaeuD-s
where the buyer is forced to buy because "o
will happen to him IL he does not And Oh 49,
question, no one can pass Judgment "l1A0
knowledge of details not accessible TO ou''4'e
Whether one or the other. the steels nave
up and they have stayed up sohdly' Emu
looks as if they would go up more
Sugar distinguished itself recently Wnen ~
mo r1.at xvas at its worst bv standing up srons