The sun. [volume] (New York [N.Y.]) 1833-1916, 1902-02-03
TIE FINANCIAL SITUATION.

Whatever NAV be the hopes OF specu-
htors who arc operating Tor q decline
N priccs, il is reasonably clear that while
.,isting conditions remain as they are.
80 great fall In values need be expected.
The strength OF tho stock market Is that
,hs,a IL no weak long interest In 1t that
s.n ho shaken out. According TO trust
s,or,bv data, tho open accounts In COM
r,i.s,on houses Of spectators for the rise
s,o lass than at any time for two years.
Sb,,sve, elements of danger there arc
In the situation seem to DO thorouehiy
understood by the great mass OF investors
and operators. The cautious puoho tenn
per that has produced dulness has pre-
vented trouble.
Moreover, il cannot be denied hat the
influences affecting the market are. at
he moment. more favorable h they
v.rs some weeks ago. The rates Tor the
,,.. of money have become merely nominal.
A. ho.yv snowfall has occurred all over
~. winter wheat belt. giving the growing
go .nrnle protection. II In, OF course,
49, carly 20 form decisive opinions OF the
nrohahla Weld OF winter wheat or OF any
sgrsoultursl product Of the current year,
save cotton. But the fall OF snow over the
VEST and Middle West Is. nevertheless.
an important matter and must be recog-
r,,ed IA sLch. II was the opinion Of most
professional observers OF the toe market
That In January OF this year railroad earn
inn would begin to decline; not because
tha roads would do a poo business. but
because earnings would compare with
the enormous figures Of similar earn
inss In 1901. Railroad earnings have not
only fallen of, but have increased; and
thew have increased despite the very
great ~diminution OF deliveries Of grain.
showing that the amount Of general bust
ness in the country passing over the rail-
way ines has been popularity underssti-
mated. The feeling Of timidity among
Investors IL ~notioeably less. even II specu-
lators are still cold. Up 70 two weeks ago
the bond market had been dull for thres
months previously. Week before last the
bond market became firm. Last week
Il was strong and active. Concerning rail-
way stocks In general the point Is made
by advocates Of higher prices that while
the average price Of railroad stocks has
not risen during the past year, b net
earnings OF these corporations have
shown very great increases; though
II Is said, on the other hand, that these
increases In net earnings were needed
In order to mako railroad stocks worth
what they were selling for. 1t has been
Observed. however. In the past that an ele-
vation Of price levels in railway securities
generally keeps pace with increased sur
ptuses. II Is a fact which will be surpris-
L.. a. -.aA. tAse So t, tha DrSsopt hnttr
the net earnings OF the railroad systems
Of the country have advanced to an higher
point, comparatively. than have the prices
Of railroad stocks. II. therefore. earnings
do not fall 10 the level Of stock prices. the
argument Is not illogical that prices must
advance to the level of earnings.
The decision Of the Ways and Means
Committee Of the House Of Representa-
tives to proceed at once with q bill cutting
OF the internal revenne war taxes Is an
exceedingly helpful circumstance. even
II the relief afforded TO the monetary situa-
ton by reason Of IL may DO postponed
until July 1. II is possible that an earlier
date may be chosen as that on which the
shall take effect, and II so. so much h
better. Inasmuch as the bill Is not
will meet with any partisan objec-
lion and. being q general sweeping act OF
repeal. will not create jealousies In any
its passage through Congress
will probably DO speedy. II Ii assumed
that the Ways and Means Committee in
reporting this bill nave such knowledge
Of the probable fate Of many Of the schemes
now urged In Congress for spending the
surplus that there Is no danger that the
Government will suffer from lack OF money
II tho bill passes. For all that. 1t Is 10 be
that the matter has been most care
fully considered. For many years previous
10 the Spanish-Amencan conflict the UNDER
wing cause Of the financial veXations Of
the Government. with their resultant dis
turbance Of the country's business. was
revenue. This IL was that
necessitated the frequent BOND issues,
the endless chain Of greenbaoks
and produced the Tressury's frantic
for gold for redemption purposes.
need Of funds for use In tho
var with spain forced through Congress
measure Of internal revenue taxation
" hAch could not have been passed at any
otbsf tims but by a desperate struggle.
Tbs financial miseries OF the Government
endsd on the day the bill became a law:
and thsns viii DO many people with memo
rice Who viii 10 sorry 10 seo this law re-
peaIed. So far a. strictly spe culAtivs
conditions are concerned. II must be OBJ
that the 'b~srs- suffer for want Of
a aggressive loader. such. for instance.
- M. woerlahoener was In 1881. when.
n u d.olarcd. conditions were much tho
ans ~ they are to-day. The attacks
upon tho market by professional operators
lave boen and continue 20 10 feeble. scat
Tered and quickly rrtTeatsd from. but
thsss genlleIncn are oonsoling
themselves With the Tsnection that q lag
captain vii oonas out q his den In
god Sason. and that tho fArt that he has
hot 80 sPp-afOd 70 s1deaos that tbs time
= h0s nPe fof his fofayt.
A sp~uAl Nd I~srhAIs = better reason
ivf market slfUnsih. howo,sr, n tho
Atutuds that has t.sn dstIayed
e'ftaan po~edul quaitafs tosaTd tie
hheh1'al situ4iion lsHfrfruns 4. not had
o. us so-saLsd ssAadafd Ol laHy o. h.
@n, siaahss 81 LasH whloh ~ ,nsml.ss
i'sr % iaay 40 lass ssIsnaao.d, i,yi 90
ssh", aissn4d inlsi.-ts 1iass interests
NANm ImHI Ia = - ~