The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1903-10-26
WEEK in WALL STREET
SURPRISING RESISTANCE OFFERED
TO ADVERSE INFLUENCES.
Effect of baltimore and Pittsburg
Failures on the Market-OutloOk
for Monetary Conditions.

appearance of the bank statement caused
a sluggish recovery from early depression,
but the movement was merely fractional
and was not maintained. the close being
irregular and still very dull. The reserve
item in the bank statement caused surprise,
the decline in cash reserves being reported
at only 5000, in face of an apparent out
ward movement of cash during the week
of between 100000 and $40 600 Bank off,
Gals were somewhat at loss to explain
the discrepancy, but some of them assert
ed that there had been considerable re-
ceipts of currency from Chicago and the
West during the week, and the expiana-
ton was hazarded that this movement
might have served to Offset the heavy out
go to Baltimore and Pittsburg and the
cotton regions. The failure of the GUS
tomary demand from the West for cur
rency at this season is the subject of
much comment in banking circles, but that
there should have been so considerable
movement in the contrary direction in the
middle of October is unprecedented. 1t
was suggested as possible that local>trust
companies had made transfers of cash de-
posts to the clearing house banks. Lon
dons uneasy feeling over the war outlook
in the far East had a slight effect in the
local market and there was q repetition
of rumors in circulation for several days,
which have as often been denied, of an in
stitution in trouble at st. Louis. There
was deposit of 100000 at the subtreasury
to-day for telegraphic transfer to st. Louis.
The variety of the demand for bonds was
as conspicuous as for several days. and
the number of quotations on the tape for
bonds exceeded i'm number and variety
those for stocks for a good deal of the
time. A recession to IS in United States
Steel preferred was the unsettling infiu-
ence at the close.
There is general agreement in Wall street
that the stock market has offered surpris-
ingly good resistance to the developments
of the week, which were undeniably seri-
Gus In their aspect. The appointment OF
receivers for two trust companies in Baltl-
more, although not wholly unexpected
decline in prices in consequence on Monday.
This was the more marked by reason OF
considerable commitments TO the long side
made by professional traders during the
latter part of last week, which were hur-
riedly thrown back on the market on Mon
day. But Tuesday saw a hasty repurchase
of holdings, and the bank failures at Pits
burg were practically ignored in the. trad
ing. The conclusion seemed to be obvious
that the liquidation growing out of the
proceeding with that which has been in
progress at the Stock Exchange for
months.
money, the rate of return on many railroad
bonds at present prices has made them at
tractive for investment. In the case OF
shares of stock. ii cannot be said that the
present situation has extended beyond a
marked cessation of the recent persistent
pressure to liquidate. There Is no longer
manifest the constant selling on all news
that might be regarded as favorable, which
gave evidence for SO long of the urgent
needs of large holders OF securities for ready
funds. The weeks events in the stock mar
ket offer some indication of a contrary ten
dency TO buy stocks on bad news. This is
largely due to demand from an uncovered
professional short interest and has not been
impressive as an investment demand.
The failures at Baltimore and Pittsburg
have not parted however, to arouse an un-
easy feeling over the possible consequences.
The growth of trust companies has been one
of prosperity. The enormous eonsolida tons
of capital for the last few years and the
final operations connected with them have
expanded the field of operations for these in
situations even along the lines of their orig
inal opera tons. But besides this their opera
tons have been widely extended into the
banking field by the increase of demand
deposits for which liberal interest is often
paid while the legal requirements on banks
for reserves do not apply to these institu-
tons Another field of operations for the
trust companies, which has been much crit
icised, has been the promotion and exploite-
ton of enterprises by underwriting. The tone
of the discussion at tile bankers confer
ence at San Francisco is sufficient evidence
of the frank recognition Of abuses In this
field among bank and trust company Of
fcials themselves. The controversy between
the New York clearing house and the New
| York Trust Company over the question OF
| the maintenance OF trust company reserves
| brought the question to the public view
| long ago. There have been episodes in New
York financial circles that have illustrated
| the abuse on the promotion side, including
| the ship building case in the pub
| lie eye. The Baltimore sample OF
| the consequence of over-commitments by
| trust companies in promotion of projects
| therefore caused a keen impression in the
! financial world, owing TO the doubt of how
far a similar state OF affairs might be
extended i'm the trust company situation as
| a whole. The Pittsburg incident was also
| examined in it's illustrative aspects. The
| enormous accret;on of wealth in Pittsburg
| of late years, growing out of the consoli-
| dation process In the iron and steel indus
try. is notorious in the financial world. The
| large extent to which this new wealth has
| gone into bank extension Is also generally
| recognized. The terms on which deposits
may have been attracted to new banking
| institutions is brought forward for consid-
i Grafton by the failure of the Pittsburs
/ bank, brought about by the withdrawal OF
| deposits by small country banks, which
had been secured by the rate of interest
| allowed on deposit accounts.
The routine events of the week have beer
/ favorable The export demand for grain
| has been liberal, and the movement of cot
| ton to market has been much freer. Heavy
| currency shipments to the South have re-
| suited but the movement to the West
| seems to be restricted STILL with the ulti-
mate demand from that region problemat-
| zeal. Railroad officials claim undiminished
volume of traffic and complain of car short
| age and freight congestion. But expert
| opinion holds that the present freight
| movement, and that for several months. &c
| come represents BUSINESS Already done, and
| estimates a probable falling off in the
| spring and a coming reaction. For that
| reason the present car shortage Is not ex-
| pected to lead to demand for new equip.
| ment. Authorities in the iron and stee
| trade see no Improvement there. No con
| siderable influence was produced by the
| late weakness in Amalgamated Copper
| growing out of decisions to cut down the
| properties affected. pending "a decision OF
| the litigation on appeal.
The breadth and activity of the bond
market have been pointed out. United
States twos advanced q, and the threes
and the old and new tours II per cent. over
| the closing call of last week.
| Following Saturdays share sales and
| the recorded price changes:
| Hig;i- Low Clos
| STOCKS Sales. est. est. Bid
Ss!iss5. { ONE: IS s. s.; );
Canadian pi Pacifc -. SO lsa liss lisl
| Central of New jersey. 100 15Iie 151ia 1874
S SRRiSssgs's' Atom Ssi'.. % * s: s
| G., & \. pref................ 100 "a 81 81
Chicago Great Western. 400 1i7s H5s l4z
Chi ! Sorthwestern 800 1854 iss 1881
| Chi Term. and Trans. 80. -. -. Q
| Chi T. and 7: pref...- -- l6