The sun., 1903-03-08
FINANCIAL AND COMMERCIAL.
SATURDAY, March Z.

SATURDAY, March Z.
All interest In to-dAy's trading upon the
Stock Exchange centred upon the weekly
bank stssemsnt. II IVES knewn that the
banks had lost cash heavily throughout
the week, but II was hoped that bank lesns
had been 90 reduced that the reserves OF
the Clearing HOUSE institutions would not
be greatly curtailed- These hopes WIRE
based upon strong indications. such ~
the weakness Of sterling exchange and
the hieher rates Of discount In the leading
European capitals. thst tho loans Of do
mestic borrowers had been transferred on
q considerable scale 10 foreign shoulders.
The loan account did show . reduction
from the previous week Of eio,ses.ooo.
but as the cash held by the banks decreased
Sie, In, 800, or over twice a much - had
been previously estimated. the reserves
held BY the banks decresssd, according
70 tho odd system es.3sA.s7 and stand
now, according to the same method OF
calculation, at but esse,s7s above the legal
minimum. This b, Of oourse, low figure
for the surplus reserve. even At this season
Of the year. EIpenences teaches, how
over, that In the great majority OF cases In
the past, when the bank NJ reserve has
declined to such q point, it has speedily
recovered from h. According to the
new standard, that h, y not reckoning
tho public moneys held by the banks as
deposits against which a reserve must be
held-pormission TO make such exemption
having been granted by the Secretary OF
the Treasury last fall-the surplus reserve
Of the associated banks Is ef6. .720. .i2S. In
case Of any emergency no action will. OF
course, bc taken by the Treasury looking
to q rt D iforcement OF reserve until this
surplus of nearly Sii 900 900 u wiped out
The decision TO maintain reserves sccord-
ing to the old standard "a described, that
is, TO hold a reserve against public money
az well as against all other deposits, was
made by the Clearing House Association
itself a. an extreme measure Of precaation.
and the Clearing HOUSE managers can
abroeste this rule at pleasure.
Prices came very weak to-day from
London, quotations for Union Pacific being
A full point on, indicating that that stock
was still the chief point Of assault by the
bear operators. The market steadied,
however. and beoams very dull until the
bank statement appsared. Tho pubiica-
tion was the signal for q furious seihns
movement throughout the list. which car
ried downward the prices Of all the active
stocks from 1 to ~ points. Most Of tho
ceiling appeared to be for the account OF
the short interest, but, Of course. In view
of the extensive declines in the market
that have recently been scored, moro or
less genuine liquidation has been and is
being caused by sales on the part OF
frightened holders or by speculators whose
margins have become exhausted. Tho
market closed at the lowest point but there
was a notable absence Of the panicky feel
ing present under similar circumstances
last December. Stock which offered the
most resistance to the selling pressure
were the Amagamated Copper. United
States Steel and the Smelling and Refining
shares.
Apart from the bank statement there
were few developments Of Importance
In tho days news. The unsettlement OF
the market was not helped by a further
pronounced fall In the price Of thu options
for the purchase OF cotton. II may b.. and
probably IL, true that there has been oon-
adorable over-speculstion in cotton and
that some decided reaction from the high
prices recently ssen for the article Il in
order; It 10 equally true. In the opinion OF
veteran judges. that In view OF the demon.
strated shortnoss Of the seasons crop,
cotton cannot be said 10 be extremely dear
at present prices. After the close OF the
market announcement was made OF the
failure of the mercantile house whose en-
barrassment in the past week has been the
cause OF a host OF totally unfounded rsinnors
affecting the solvency OF many large oon-
Germs. The failure can hardly be said to
pos<ess any wal1 Street importance. In
the Judgment OF most disinterested OBJ
servers, the true reason Of the recent weak
pess of the market in to he found not In
the diminution OF banking resources at
this centre-al although to-day's bank state.
ment points clearly enough TO the necessity
of q further contraction Of loans extended
10 speculative borrowers TO the dis
p,,tA latween the majority and minority
interests in the Southern Pacific Rail
road Company. OF which due mention
has already been made In this column. This
dispute does not involve In any way the value
Of the Southern Pacific property; indeed.
II Il was settled In . way favorable TO the
claims OF thcse who are now believed to
lie most influential In depreesing the general
market II would probably result In . marked
aivar ce In the price Of southern Pacific
stock. and the strength to-day OF the souti =
ern Pacific shsrs A. compared with Other
stocks In the railroad list Was very sig
nifcant. II may 10 we'll to refer again
20 the fact that tie short interest ln tie
market is now unquestionstly enormous.
There IL trailing after thoee who. for what
may . called private rrason. have adopted
q hostile attitude to the market, . srat
mas of rcckiess even though large speou-
la,ors Possibly IL might bs . prudent
thing for thsss last-namsd sentien en
20 Tear in mind that the s4ttisment Of u q
Union Paaihc-Southsrn Psniho dispute
nlsy come un.npsctedly and 10 not hksly
to con,ain any provision fos furnishing IA
tism Union Paaho Stock With which Ia
cover ,heir shoV con''srs
Sec Ssvk ssssh tsshsa0s asiss. March .
usrsp ssssss Aso sssrs sosns ~ N.sss