The Birmingham age-herald., 1903-03-08
REORGANIZATION
 IN STOCK MARKET Surplus Reserve of Clearing House Banks Wiped Out LOSS CAUSED BY DECLINE Some Futile Efforts Were Made to Check the Decline By Supporting
 Orders, But These Proved Too
 FHmsy for the Purpose.
LOSS CAUSED BY DECLINE

New York. March 1.-The stock market was thrown into a condition or oeinorai- ization today by the disclosure ol tue fact that the surplus reserve or the ciear- ing house banks was practically wiped out. Excluding government deposits tnis item is now s666,9 975, compared With so'- s5S, 425 at this time last year, and Slo'fii'- 275. two years ago. The severe loss Tn cash reserves was about as much above the preliminary estimates as last week s loss was below it, thus disclosing the rectiecation by the average system of comnutation of last weeks discrepancy.
 The $l0. ,OOO loan contraction fulfilled the expectations of stock market exports that liquidation of the week and the shift ing of loans to foreign money markets would be reflected in that item, but the loan contraction must have been nearly s40.000 900 to keep pace with the rate Of depletion of cash reserves No reader of the bank statement can be left In doubt that further calling of loans would have to be resorted to by the banks next week and operators threw over stocks Tn all directions to prepare for this emergency Some futile efforts were made to check the decline by supporting orders, but these proved too flimsy for the purpose and prices broke through violently to the lowest of the week. Prices were crumbling dangerously when the mar ket closed at about the lowest. ana on very active dealings Fierce raidlng tactics by the bears were factor In the slump.
 The speculative contest in Union Paci- fic was made evident by the extreme break of 3% in that stock. Losses in St. PauL Canadian Pacific, Manhattan, New York Central and St. Louis and San tran- cisco. ran from 8 to 33s. The/bank state ment appeared to be the sole factor in the market and before its appearance the trading was languid and sluggish.
 The indications of large selling orders served to shake this confidence and awaken the fear that the market would have to face a skillful and hostile cam paign directed towards forcing prices to A lower level The declining reserves or banks and the loan contraction which re- suited were the determining factors Tn the situation But up to this week, this factor has not been largely effective III shaking the confidence of large specu- lative party in a spring advance in prices.
 
 when forced by restriction of credit facil- ities.
 Sentiment this week has changed and has become bearish as shown by the ready attention given to all unfavorable developments and the entire lack of con- sideration given to anything or Kind promising all for values. Great disap- pontment was caused by the showing of net earnings by such railroads as re- ha xuaak fOr January. The December showing had been better than that for November, and the fact that many advances in freight rates had be- come effective in January led 10 the hope that the inroads upon net earnings, due to increased operating expenses, would be corrected during January. OW- ing to freight congestion, storm block ades and the high prices of coal Tor fuel, the January returns show that 1n- creased gross earnings of railroads are generally almost wiped out by added ex- penses.
 There has been recurrence of uneasi- ness over the labor outlook, due to the dispute between the Wabash and its em- ployes There is dread that the dispute may spread and involve other systems. The judicial injunction issued against the labor union has come under interested discussion on account of it's far-reaching scope and the outcome of the legal dis pute is awaited with lively interest. The slump in cotton was not without its ef- feet upon stocks, owing to the liquidation for the purpose of protecting interests in the cotton market. The money situation from day to day was reflected in the ad- yanced interest rates With surplus re- serves of the banks last Saturday at the lowest figure for a dozen years, with loans practically at the highest record figures for the New York associated banks with the sub-treasury withdraw ing nearly a million a day from the money market, and with interior ex- changes holding against New York, it is not surprising that loan contraction by the banks has been followed and that money rates have run up, notwithstand- ing resort to foreign money markets for very large loans No accurate estimate of this foreign borrowing can be made but the break in foreign exchange and the rise in interest rates at Paris and Berlin with the necessity for the Bank of England to retain it's per cent mini mum discount rate to protect the London market. are all unmistakable indications that it has been large.
 Bonds have suffered in common with stocks in the weeks selling movement. United States 2s coupon and 3s coupon advanced 4 and the 2s regular declined A per cent, as compared with the clos ing call of last week.