The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1902-10-04
STOCKS TAKE A TUMBLE
REPORT THAT SECRETARY sHAw's
ACTION WAS ILLEGAL THE CAUSE.
Statement Denied by the Controller Of
Currency, and Violent Rally
Marked the Closing Hour.

NEW YORK, Oct. 3.-The stock market
was thrown into a violent decline this af-
ternoon by the receipt of dispatches from
Washington by two Wall-street news bu-
reaus saying that the controller of the
currency had declared illegal Secretary
Shaw's plan to abolish the % per cent. re-
serve on government deposits in national
banks, and thus put s30O00,000 out to re-
lieve the money market. The news was
flashed through Wall stree. by the ticker
service, and in a short time heavy blocks
Of stock were offered for sale at rapidly
falling prices. st. Paul, which had been
strong all day. fell So; Missouri Pacific,
IA; Reading, A; Union Pacific, 4; Illinois
Central 3h; Baltimore Sc Ohio. General
Electric and Colorado Fuel, 3A each, and
other stocks to points.
The rush to unload was overwhelming
for time, but orders to buy were given
and rally followed. Near the close an
authorized denial was received from the
controller of the currency. and the market
closed active and strong. The situation, in
fact, would have been worse, in that the
forces of depletion of bank reserves have
continued in operation during the week,
while some advantage has been taken In
the loan account of the better conditions
resulting from the treasurers measures.
To-day, especially, there was some con-
spicuous resumption of speculative activity
on the part of various pools, notably that
in Colorado Fuel, on the ground that the
election ordered by the court will settle
the vexed question OF control or property
IN st. Paul by the same interests which
caused its recent advance, and in the coal
ers on the circulation of constant rumors
regarding the outcome of the conference
at Washington.
The higher level of prices thus attained
seemed to aggravate the drop when the
canard was put out regarding the alleged
action of the controller of the currency.
controller present
and In consultation with the secretary OF
the treasury during his visit to New York
of, and the speculative public seemed to
swallow the story without question. The
break in prices ran all the way from 1 to
nearly points in the active stocks.
The market closed with a violent rally In
progress, caused by the denials of the
story. To-morrows bank statement will
contain an additional item to show the
government deposits with the banks, in
order to differentiate the other deposits.
against which a Is per cent. cash reserve
is required. 1t is supposed that the item
of government deposits will be in the
neighborhood of S40,00O000, thus reducing
the reserve requirement and benefiting the
surplus by about sl0,0O0,OOO.
ments indicates that the banks have lost
nearly a million dollars to the interior on
the direct express movement, and $4,000
to the subtreasury. The subtreasury OPP
erations include deposits for transfer to the
interior, except 100000 to New Orleans and
100000 to Chicago, which were deposited
for that purpose to-day, and also the pay
ment of anticipated government interest
made through the New York subtreasury.
The payments of government interest due
after Oct. i, and the application to subsu-
tute other than government bonds to re-
! lease consol per cents for the purpose
of additional circulation, seemed to prom
Use little relief to the situation thus far.
| The heavy demand for exchange to-day for
next Tuesdays steamer showed the small
| prospect of any movement of gold this
| way for the present Some $1,515000 in gold
| was drawn from the Bank of England to-
day for shipment abroad.
The weekly exhibit Of the Imperial Bank
I of Germany showed loss of over $31, 900 900
in gold. loan expansion of over $50, 000, 900,
and an increased note issue of about $780,,
1000, thus bearing out the showing of
other European banks of the heavy re-
quirements upon foreign money markets.
The bond market was steady, except for
the furry in the last hour of the market
| Total sales, par value, $685. 900. United
| States bonds were unchanged on the last
| call.
! The following table shows the range of
| stock prices on Friday: