The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1902-08-30
CONDITION OF BUOYANCY
STOCKS A MUCH BETTER
TONE AT THE LAS TOUR.
Price Level Generally Higher than on
Monday-MOney Market Conditions
the Cause of Much Discussion.

49, VI
to-day's stock market, and in the final
dealings the market broadened out into
animation and strength. This was in
face of a rise in the call-loan rate TO 5
per cent. and a forecast of the bank state
ment indicating a cut in the reserves of
nearly $1,000. 900. The immediate prospect in
the money market seemed to be overlooked
on account Of the reports of the compre-
hensive plan said 20 be favored by the sec
rotary of the treasury for the expansion
OF the note circulation of the banks, by
which it is hoped to relieve the demand
on the lawful money reserve for use in
the circulation incident TO the ~crop-moving
period. 1t will be remembered that the
offer of Secretary Gage to redeem bonds
made in April of last year had resulted
up to the LIST of January of the present
year. in the redemption of government
bonds to the par value of S5s. 222, $50, and in
the payment to the money market, includ-
ing premiums, of 81, 744,S42 These dis
bursements were an important influence In
maintaining the tranquility of the money
market last fall, but the governments
standing offer proved so attractive that the
banks began to sell bonds and retire their
circulation in the spring as rapidly as the
law WOulO allow. 1nlS was neutraIlZlnS
the purpose Of the bond ~redemptions. so
that Secretary Shaw withdrew the offer
early in March. His efforts to stimulate
the note expansion are evidently due to a
recollection of the conditions thus caused
by the of government bonds.
Prices of the bonds have declined material
ly since the withdrawal of the government
redemption order. They have risen again
since the note-expansion plan was dis
cussed. and to-day the bid prices of the
fours Of 1925 jumped ia per cent, indi-
eating the scant floating supply, and the
difficulties of bank-note expansion.
The encouraging effect on sentiment or
the discussion of this project was supple
mented by the belief that the language of
the circular issued by the Southern Rail-
way voting trustees could be accepted as
indicating the incubation of the project for
a Southern railroad merger. There were
the usual rumors also of an early settle
ment of the anthracite strike. The buying
OF Union Pacific was attributed TO a de-
sire on the part of insiders TO encourage
conversion Of bonds into stocks. There
were some points of irregularity in the
market. The express stocks reacted sharp
ly. American Bicycle securities, including
the bonds on which action on the interests
is expected on Monday, were notably weak.
The selling was accompanied by reports
that it was due to liquidation induced by
the. coming retirement of a leading inter-
est. Atchison and Canadian Pacific were
| Conspicuous lOI dCllNllJ dnO SlItlSln diu
there were gains of a point or more by
many less active stocks.
The bond market was firm in sympathy
with stocks. Total sales, at par value,
were 50, 10000.
The average level of prices for stocks
have dvanced this week. A detailed in
spection of the changes shows them to have
been very uneven. A powerful and intiu-
entiai speculation combination has made
determined efforts to advance prices and
TO awaken a general speculative interest
in the market Their method was TO con-
centrate their buying and manipulation on
one stock or small group of stocks at Il
time, proceeding from one to another on
each successive day. Following the ad-
vance,, there was in each case heavy realiz-
ing, which carried the price back while a
new point of strength was developing.
These movements had no specific new de-
velopment to account for them, and the
campaign was a~vowedly based on the gen
eral promise of prosperous conditions for
the country for the coming year by reason
of abundant crops and undiminished bust
ness activity. The movement encountered
several obstacles during the week, but the
market offered good resistance to the vari-
GUS reactions, as good buying demand de-
veloped In the course of the declines.
Much solicitude was expressed at various
times over the capacity of the money mar
ket to carry the speculative campaign
through the period of expansion in the
needs of the circulation, the heavy move
ment of funds to the interior reinforcing
this feeling. The speculative leaders, how
ever, professed confidence In the capacity
| VI Ut lOlCy supply ait lIS 0dll lOlIC
rate, by its stability, helped to bear them
out 1t was obvious, however. that the
rising prices were taken advantage of at
all stages to effect very heavy realizing
on the part of previous speculative buyers.
An impression was prevalent that the heavy
dealings were resulting in the transfer OF
holdings from stronger to weaker hands.
1t so happened that two of the untowar6
developments Of the week came in the midst
of heavy speculative buying in the stocks
Immediately affected. The reduction of the
dividend on Reading first preferred came
while Reading was being bought eagerly In
enc to six thousand blocks, with the natural
result of heavy unloading by Disguised
spectators which turned the whole market
weak. The active advance in Atchison,
also, was checked by the publication of the
report OF net earnings for July, showing a
heavy decrease compared with last year,
but the quick relaxation of the heavy sell
ing pressure was very notable in these
stocks, as in others. buyers apparently
standing ready to take unlimited offerings
at concessions. The conditions which cause
this tendency have light thrown on them
by the circular sent to stockholders by the
Southern Railway voting trustees, explain
ing their action in deferring the declara-
ton of the dividend on the preferred stock
which would result in the dissolution OF
the voting trust.
In the money market problem interest has
centered this week on the question what
substitute will be offered this autumn fol
the relief that has been afforded by Treas
ury Department measures for several years
The government refunding law, with the
bank note expansion, included large in.
creases of deposits of government funds il
national banks, purchase and retirement OF
bonds by the government, and these have
all been resorted to until ii is believed the
available supply of government bonds ha:
been swept from the market or reduced Il
such small proportions that any consider
able demand lifts the price to a point wher,
il is Improbable TO use them either as Sc
curity for bank circulation or for govern
ment deposits. The large growth in tn,
government receipts from customs is prov
ing sufficient to more than Offset the reduc
tiOn in internal revenue taxes by the aboli
ton of the war taxes. The government!
surplus revenues therefore threaten t.
make troublesome acquisitions on til
money market again. while the availabl,
means of relief are much exhausted. Thi
was the repressive influence on the stool
{ market. and is expected to be so for tn,
immediate future.
Convertible and speculative bonds hav,
been active during the week, and havr
moved in sympathy with their relate,
stocks. United States new tours advance,
,. the old tours l, the twos and threes :
and the fives y per cent. as compared wit
I last weeks closing call.
The following table shows the range o
t prices on Saturday:
lGranger Farweu's TeIegram.1
Stocks Omen HfOb- V,ur CIo.