The St. Louis Republic. [volume] (St. Louis, Mo.) 1888-1919, 1903-03-08
STOCKS ARE DEMORALIzED;
BANK SURPLUS VANISHES.
MARKET CRUMBLING DAN
GEROUSLY AT CLOSE.
Bears Aid the Precipitate Decline
by Hard Hammering of
All Prices.

New York March 6.-The stock market
was thrown into a condition OF demoraliza-
ton TODAY by the disclosure OF the fact
that the surplus reserve fund of the clear
ing house banks was practically wiped cut.
Excluding Government deposits, this item
Is now s6;6975 compared with 81. 95S AS al this
time last year. and s10.9iI 20 two years ago
The severe loss In cash reserves was about
as much above the preliminary estimates as
last weeks loss was below it, thus disclosing
last weeks discrepancy. The $4,000 coo loan
contraction fulfilled the expectations that
the stock-market liquidation of the week
and the shifting of loans to foreign money
markets would be reflected in that Item but
the loan contraction must have been near
$40 $50. to keep pace with the rate of de
pletion of cash reserves. No reader of the
bank statement could be left in doubt tina
further calling OF loans would have to be re-
sorted to by the banks next week. and OPP
orators threw over stocks in all directions
TO prepare for this emergency. Some futile
efforts We're made TO check the decline by
supporting orders, bat these proved too
fimsy for the purpose. and prices broke vio-
lently. to the lowest of the week. Prices
were crumbling dangerously when the mar
ket closed al about the lowest and on very
active dealings.
FIERCE RAIDING.
Fierce raiding tactics by the bears were
factor in the slump. The speculative con-
test In Union Pacific was made evident by
the extreme break of 80. in that stock.
Losses in ST Paul. Canadian Pacific, Man
haitian. New York Central and St Louis
and San Francisco ran from 3 to 3ss. The
bank statement appeared to be the sole fac
tor in the market and before it, appear
ance the trading was languid and slug
gtsn. TIE assignment of Dresser & Com
close of the market. The money situation
has forced considerable liquidation In the
stock market this week and prices have
made wide declines. The knowledge of the
financial Embarrassment of wholesale
commission house was not sufficiently def
mite to prevent credence being gwen to a
swarm of alarnist rumors which got into
circulation on Thursday and resulted in
acute weakness in the stock market
throughout the day.
conviction that Its money troubles were pc
culiar to Itself and that the commercial po-
sltion in the country as whole is indis-
putably sound. The suggestion carried in
Thursdays rumors that mercantile estab-
lishment credits possibly were overextended
and likely TO have difficulty in money mat
became evident also that a powerful and
well organized bear party had undertaken
campaign against values. The undertone
of firmness which has been evident for a
long time, even through periods when eff
forts were unavailing to advance prices has
been attributed IN no small degree to the
bear leaders of past movements have been
committed TO the protection OF prices either
by large long interest In stocks or by con-
tracts OF engagements with syndicates for
the market guardianship of certain securi-
ties.
HEAVY SELLING.
The. indications of large selling orders
served to shake this confidence and awaken
the fear that the market would have to
face skillful and hostile campaign directed
toward forcing prices to a lower level. The
declining reserves of the banks and the loan
mining factors in the situation. But. UP
to this week. this factor has not been large
ly effective, in shaking the confidence of
in prices. Selling has been grudsingly done
and only when forced by restriction of
credit facilities. Sentiment this week has
changed and has become bearish. as shown
by the ready attention given to all unfa-
vorable developments and the entire lack
OF consideration given to anything Of a
appointment was caused by the showing
Of net earnings by such railroads as report
ed during the week for January. The De-
cember showing had been better than that
for November and the fact that many ad-
vances in freight rates had become effective
in January led TO The hope that the inroad5
upon net earnings due to increased operat-
ing expenses would be corrected during jan
uary.
The January returns show that increased
gross earnings Of railroads are generally al
most wiped out by added expenses. Union
Pacific showed decrease OF over 20 per cent
In net earnings in January. and for st. Paul
the gross as well as the net earnings fell on.
The gross earnings for February. on the
contrary, showed some handsome gains.
New York Central gained over 20 per cent
gross. The average rate of increase of all
railroads thus far reporting for February
reached to nearly Il per cent. This showing
failed TO reassure holders of stocks.
GLOOMY RECEPTION.
. The wholesale expenditures contemplated
the enormous capital issues projected TO
provide means, meet gloomy reception in
the financial world. The promise of an in
crease OF earnings sufficient to pay charges
on these issues ie not effective in relieving
the ieaIs caused by the rapid absorption OF
available capital, the giut of new securities
ana the slow market for them. and the
tumn. The failure Of the Aldrich financial
Dill emphasized this feeling as some relief
from the drain Of surplus revenue collections
rom rom me money market had been hoped for
. The decision Of the United States Steel
corporation to proceed with its projected
was followed by drop in the price Of new,
bonds. when issued, from above 95 to below
Ihis incident had a notably disquieting
eject upon financial sentiment There has
oeen a recurrence of uneasiness over the
aoor outlook. due to the dispute between
ne wabash and It's employees. There is
Tread that the dispute may spread and in9
olive other systems. The judicial Injunction
ssued against the labor union has cows ~
.es interested discussion on account Of far
sal dispute Is awaited with lively Interest
ne slump In cotton was not without its ef
ect upon stocks, owing to the lio,,jdation
or the purpose Of protecting interests In
ne cotton market. The money situation
rom Gay to day was reflected in the sd
'encing interest rate Ae Au-
WIN surplus reserves in the bank last
saturday at the lowest figure for a dozen
years with loans practically at the hiah
Isl record figures for the New York asso-
lated banks. with the Subtreasury wifh-
irawing nearly million a day from the |
money market and with Interior eYchanees
1oiding against New York. II fs nor a1,r,
'rising that loan contraction by the hanks
has been followed and that MONEY ratss
iaye run UP, notwithstanding resort IN for.
.ign money markets for yery Iarre Ioans
No accurate estimate of this foreir hnr.
owing can be made. but the break IN Sor-
Ign exchange and the rise in Interest rata.
4 Paris and Berlin. with the necessitv for
he Bank Of England to retain ito I nsr
ent maximum discount rate to protect The
london market. are all unm;stakabIe jndi
atoms that 1t has been large
Bonds nvae suffered In common u,tb
tocks In the weeks selling movement
United States Is coupon and IS coupon ad
,anced 4 and the 2s registered declined
: per cent as compared with the closing
all Of last week. e.o'''s
New York Stock Quotatiou.-
ST Louis, March THE following snous ,ha |
re.,hns' nshsst, lowest and closing Quotations
n tne New York Stock Exchange {o-dav Cor |
ected d1ily for The Republic by Francfs d. ~,
Co. bonds and stocks. No. nj North E,cnrtb