The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1902-10-12
WEEK in WALL STREET
BANK STATEMENT A PUZZLE AND
GIVES LITTLE ENCOURAGEMENT.
IL Is Now Believed that the Reserve
Released by Secretary Shaw VIII
Not He Released for Loans.

bank statement served as evidence of the
large marginal holdings of stock that must
still remain in the market. The nervous
ness disclosed by the prospect of further
Withdrawals of credits from the stock mar
ket by the banks could hardly be due to
other than those holding stocks on margin
with borrowed money, None of the best
equipped financial authorities could pre-
tend to explain the showing made by the
banks
The shifting of loans due to the weeks
syndicate operations may be supposed to
have offset the large liquidation in the
stock market, and thus account for the
expanded loan account of the banks. But
conjecture is at loss to account for the
disappearance of the expected gain of over
$2,OOOOOO in cash reserves as a result of the
receipts of foreign gold during the week.
The small gain in the net deposits also
fails to prove with the changes in the
loan and reserve items. The statement
showed the standing of the surplus with
the exemption of reserve allowed against
government deposits, as we'll as without
that exemption. But the present policy of
the banks of not encroaching upon the re-
serves against government deposits has
been SO clearly shown to leave little
comfort for spectators in the hope of a
resort to that relief.
There was some large selling before the
appearance of the bank statement, which
was attributed to the account of a large
operator who was seller at different times
during the week, but the selling at the last
was quite promiscuous, Including the put
ting out of short lines by professional.
traders. The assumption was general that
further loan contraction by the banks is to
be expected
Important liquidation of MARGINAL ac-
counts has been effected in the stock mar
ket this week with corresponding benefit
TO the resources of the banks available for
otner purposes. The result has been a
growing relaxation of the pressure upon
stock market borrowers to sell stocks and
repay loans. The question has come into
prominence whether the forced foundations
finally over for the season and the spec
ulators short of the market have shown
their fears that this may be true by cover
ing their sohrt contracts. This short COW
ering has been an important element in
the recovery OF prices, but observers have
professed to see evidence of buying by i'm
portant inside interests, as well. Not
wltnStandlng the important recuperation
accomplished by the banks, they have per-
sistenty refrained from extending their
stock loans and have implied their convic-
tion that 1t is the part of wisdom to con-
serve their resources for the large demand
from the interior. which is still likely to be
made.
The unchanged form in which last Satur-
udy ; Dank statement was given out, count
ing government deposits with others as de-
manding the maintenance of reserves
against them, In spite of the permission by
reserves against government deposits was
accepted as notice from the banks that no
loans s.; would be stock-market borrowers.
Inc important liquidation of the early part
OF the week followed There is good
ground for the belief that this included
large holdings by some of the powerful
pools and individual operators who have
strven TO contest the reaction and revive
the bull speculation. In addition to the re-
lief or the money market thus afforded no
less than s5,Oo0.O00 of belated gold arrivals
nave been made available to the New York
market OF this about IS, 100000 was of Aus
tralian gold, transferred by telegraph
through the subtreasury from San Fran
cisco Immediately on its arrival there and
the remainder was made up by parcels of
gold from Europe Of the lot Of South At
rican gold secured on passage by the Ma
tional City Bank.
There have been large payments on ac-
count of New York taxes during the week
and the deposit of the proceeds in the
banks has added to their resources There
have been some large syndicate transac-
lions also, including the payment of a 50
per cent. installment of nearly SIS. 600 900 on
account of the Louisville & Nashville
transfer and a so per cent. call on sub
scriptions to the ship-combine syndicate
for about s15,OO0,0O0 Preparation for these
was an unsettling influence on the money
redeposited in the bank The banks. how
ever, still refrained from relending In the
stock market and the money stringency
continued.
the presumption that the increased banking
resources were to be made available for
the stock market the call loan rate would
be run up to Is per cent which is consid-
cred prohibitive for stock speculation pur-
poses. 1t is evident that the iiouida-
ton has been held well in hand and direct
ed with purpose to avoid all possible
damage. The interests involved i'm the
large speculative commitments in the stock
market In the control of the banks and
trust companies, in the ownership of the
large railroad systems and in the great
projects OF combinations and the resulting
crop or new securities are so intimately re-
lated and so nearly identical that this eau
tious and considerable policy is easily under
stood. On this ground the relaxation of the
pressure upon marginal holders might he
interpreted as designed to steady prices in
preparation for further liquidation and to
take advantage of the short sellers driven
to cover by a rally in prices Speculative
sentiment is thus kept in uncertainty
whether the necessary liquidation has been
accomplished or whether ii has simply
paused.
Looking to the future there is no further
important relief for the New York money
market in sight until the interior move
ment OF currency shall turn again in favor
of New York. Practically ali of the gold
reported engaged both in Australia and
across the Atlantic has now arrived and is
In the reserves of the New York banks
Discounts have become easier at the for
eign money centers, but the downward
course Of sterling exchange which resulted
has been checked by the demand for re-
mittance in payment of obligations The
great foreign banks continue to lose gold
and 1t Is estimated that the Bank of Eng
land Is about to take measures to make its
advanced discount rate effective in the omen
market, and thus check the onward move
ment of gold.
The fine weather of the week has been
favorable TO the movement OF grain. which
has been delayed, and the downward course
creasing pressure there for currency. hut
the forward movement of grain gives prom
Use also of replenishing the supply of bills
In the foreign exchange market. with the
cessation OF active pressure upon borrow
ers to liquidate, there has been increasiny
attention paid TO the effects of the anfhra.
cite miners strike and the varying phases
of that contest have been reflected in price
movements.
Bonds have shared to degree I'm the d.
preston of stocks United States old tours
and fives advanced u, the threes ~ and the
new tours / per cent, as COMPARED with
last weeks closing call.
The following table shows the range p,
stock prices on Saturday:
IGranger Farwell s. Co.'S Telegram1
| STOCKS. Open High. Low c,os-
INDUSTRIALS- ing est est AZ.
Am. Car K Foundry ......... 34L s4i@ "a a.
| Am. Car a Foundry pref. 30 Ga
| Am. Cast Iron Pipe......... Is lG IL isil
| Am. Cast Iron Pipe pref. a% Hx 5sil al
| Am. Grass Irvine "A -. "a
1 American Ice ............... 9% - o..
! American Locomotive go. 29Ts 29z 2sn 9ai,