New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1903-08-02
Financial.
The Financial World.

/ yesterday. when the market melted away on tn
publication of the bank statement which showss
I no decrease in the loan item. True. the surul,
reserve increased over 5.OOO.O 900: but the Ioan,
the loans-this was the cry: and the traders sofa
I stocks in fright. This was natural because
there had been great expectations raised Of a
heavy decrease in the loan item. as a result a,
the liquidation In the stock market and "a
paying off OF the Pennsylvania loans.
The Street has long been uneasy at the pa-
sistency with which the loan item has stu.x
around the 900 million mark; and when aftar
such week as the past. not only no decrease
was shown but even a small increase II a.
seem as if nothing could bring down that s-a,s
aggregate: that as fast as one borrower was ahl.
to pay off his Indebtedness. another was elTarlv
waiting TO borrow. 1t does look H.tls 5,s
turblng; but as a comfort. It may be pointed or
that the cash resources of the banks are IN
ereasing; and this weeks increase in surplu.
reserve Is equal to S2OOO0OOO decrease in Ioan.
If surplus was 70 be increased that way tn.
surplus reserve totals now. little over "A nil
Ions. which is very respectable showing
II viii be noted that money Is getting dsara,
in the country. This is likely to continue. a.S
the chances are that 1t VIII get dearer stu A
good deal must have been sent TO this csnt-.
from outside to strengthen stock accounts: bpt
anyhow after a srnash-up in Wall Street n.
-
sign Of it is a Tightening Of money at the vart-
Gus commercial centres. When the pinch oex,u.
to be felt there. it brings TO a sudden stoD n.
customary boastings that the country Is not N,
terested in the gambling operations OF Wall
Street
What has taken place at the financial cent?.
OF the country in the past six months Is a con-
sequence OF conditions which il win soon IA
demonstrated. are not confined to Wall Street
To supposs that there has been no imitation and
over-expansion except in the production and
price Of securities. is to suppose that the anan-
| ciaI community is thing apart; that tn peools
here are distinct class from all other bushes,
people In not great While. it viii appear thar
in commercial and industrial circles the G has
been imitation and expansion not a whit behind
what has been seen in Wall Street. and thar
contraction as severe as the financial world has
experienced viii shrink the buoyant expansive
ness OF the merchant. the manufacturer, the
builder and the rest of the list
ANY man in business outside Wall Street who
is much spread out in his commitments az this
time. is in the sane doubtful position as the
man in the Street who six months ago was sim
iarly spread out. His position is one Of increas-
ing danger. There is time for him 70 make him
self secure. there was for the Wall Street
man; and the experience win be the same. The
man who doesn't make prudent use Of the time
still at his command. and get himself snug. is
likely to find himself travelling a rough road
early next year
In about twelve months from now we shall De
| talking again about the virtues of economy.
The word has been out OF use for three or four
years. But when the butcher. the baker. and
candlestick maker are having hard work TO col
lect their bills. sermons will be preached on the
sinfulness Of past extravaganza. and it win be
fashionable TO wear your old clothes. Money
Will be easy in Wall Street then; and that Is
about the only place where it will be-
The securities market is trying to find bot
tom Temporarily II appears to have done so.
At least il has struck ledge on the way down
The weakest concerns have gone. those who
could be saved have been saved: and il seems as
II the market would be comparatively quiet for
a while. awaiting developments. This means
primarily. waiting on the corn. cotton and
spring wheat Our winter wheat crop Is salts
factory. II we have good corn crop. il viii
enable any further liquidation which may be
| necessary 10 be done quietly and without seri-
Gus trouble. If it is to be a short crop. the
liquidation will not progress so easily.
On the technical position. the market would
seem to be entitled to a smart, If irregular
rally: and this 1t may have. although the Rock
Island clique seem bent on frightening any
thing like rally out OF it. The way their
tonishfng bond scheme received may be
imagined. when the first runors OF it were
thought to be a bear canard. The Official an
nOuncement followed too quickly for the rsgula-
ton pl eachments to be heard on the iniquity Of
bear rumors. The wording Of the notice stating
the uses to which the $3.50 100000 Of new bonds
we're to be put. was surprising as the amount
Of them. Nominally this is a refunding issue;
really. it is an issue for any one or more OF half
a dozen purposes. and not a solitary bond need
be refunded under IT, In fact ii is a general
issue. for general purposes. At any rate this IS
how the notice reads. The Street. one may say.
was aghast- The general query was: Where
are these people going to stop"
OF course. there can be no actual issue now.
simply because no one could be found 10 buy
such bonds; and 1t would seriously damage the
credit of any bank to have il known that it had
taken a block of them. What the Street saw,
was not immediate danger. but the constant
movement towards unlimited expansion II IS
asserted. indeed, that even this issue is not al;
but that on top Of IL. the San Francisco Com
pany. which has been absorbed by the Rock
Island. is preparing 20 come out with separate
mortgage and bond issue OF S125, 100000. Nor
viii ii be forgotten that the original PER cent
refunding mortgage and bond issue Of the Rock
Island. for 100 millions (under which 90 millions
were issued) was raised by a new instrument
| later, to an authorization of 200 millions. This
underlies the new proposed issue 1t VIII be
seen' therefore. that the machinery for manu-
featuring alleged bonds bearing a Rock Island
seal is nothing less than porteatous.
The Street was right when il asked where
these people are going to stop. Those who re-
member something more than the events Of yes
|