The sun., 1903-01-19
THE FINANCIAL SITUATION.

undertone and managed to repel In pretty
stawart fashion the attacks OF the bearish
guerrillas who lowered upon its TANKS ana
rear There were times when the market
looked weak and when II seemed a. II a GOOD
smashing blow delivered squarely on ns
front would send prices down. But II was
only a show Of weakness. not the reality.
There are no speculative interests In exist
enoe powerful enough to seriously depress
the market. and there is nothing in sight at
the moment to warrant the expectation OF
such a thunderbolt as the result OF natural
conditions The professional element, or
rather the party known as the room traders'
have been against the market for consid-
! cradle period. Their chief and only arg'l-
ments are that after so marked rise IN
price, that has occurred. there ought to be
reaction. and that public support OF the
market Is lacking. Theoretically. the force
of these contentious may he admttto.
But theory is often a poor guide IN wall
street. and even devotion TO time-honored
precedents sometimes causes stumbling
| stops The fundamental facts are that
| money is easy, that those who hold secu-
| rites for investment see no reason to force
them to a sale. and that the really great
! spectators and semi-speculators in Wall
Street would rather buy stocks for the rise
than sell them for fall. These speculators
are backed up in a way by banking inter
ests; that is to say. the banks will lend
money now on speculative collateral as
they would not six weeks ago. and there are
many plans hi,h are dearly cherished in
bank parlors which can be better worked
out in AN advancing stock market than in
receding one. While these conditions
remain unchanged the speculative chances
certainly favor higher prices.
At the end OF the week Wall Street knew
as much about the reason for the rise in the
Erie shares. around which the, trading in
all other stocks practically centred. as 1t
did at the beginning. 1t was the uncer-
tainty as to whether there was anything
substantial in the movement or whether
there was a modicum Of substance in it,
surrounded by great bulk Of speculation.
that made traders hesitate. The final con-
sensus was that the control Of the Erie
company rested firmly where it had rested
so long and that whatever had been going
on" regarding it was with the concurrence
OF those controlling interests and would
inure to the benefit OF the property. One
thing that may be understood as certain is
the control Of the Erie Railroad so pass
that the harmony Of the Eastern rail-
road situation will be disturbed. So far
as money is concerned. the state OF the
exchange market seems to favor gold ex-
ports; but whether exports of the metal will
take place depends largely upon whether
the powerful protective syndicate that has
had that matter in charge is willing or is not
willing that they should occur. Judges
who incline to timidity. IL anything. in their
views of financial and stock market affairs
declare that the shipment Of a moderate
quantity Of gold will not affect prices OF
securities in the least We are now SO plenti-
fully supplied with money that the matter
will be regarded no more than the transfer
OF cash from this city to a Western town.
The course Of the foreign exchange
market in the current year will be unusually
interesting TO watch. II is now clear that
the decline In our export trade last year was
due almost wholly to the disaster that
befell our corn crop in the year previous.
This year we have uncounted millions OF
bushels OF corn and wheat that can be ex-
ported and are being exported at prices
higher than most people expected they
would be. Our cotton, too. is commanding
high figures and this is a commodity which
Europe cannot do without. Everything
| now indicates that our exports will be
| greater this year than they were before.
| But our imports? Will an increasing
volume of these Offset the enlarging ship
ments of commodities from this side and
80 keep sterling exchange lowering around
| the gold point "a it has been doing for the
| last three months? Here is a perplexing
| question. Thefrade returns for December
| published last week showed a splendid gain
| in export business, but they also recorded
that imports increased more than exports
did A good share OF these imports were of
raw manufactures brought here, despite the
tariff, in composition with our products,
for use by our manufacturers. The fact
suggests many curious trains Of thought
Those who dip far into the future on the
question Of our foreign trade also take
somewhat into consideration the hostile
tariffs now directed against us by certain
European countries, notably Germany and
Austria. The reports OF the Trustworthy
mercantile agencies are that general busi-
ness is progressing as magniicently as
ever, with sales and collections alike good
and an outlook for the largest spring trade
| ever known in our country. The jam OF
traffic over the railroads still continues
and railroad managers are frankly admitting
that while the congestion lasts they find ii
hard to operate their roads economically.
Higher freight tariffs. onoerning whose
| justice and absolute necessity there can he.
| of course, not the slightest manner Of doubt,
| will remedy the matter in time. But the
| remedial process is not one that can be
| made effective instantaneously.
The impression is that there will he no
| currency legislation in Washington this
winter. 1t is a pity that at least some Of
\ the Objectionable features of the present
Treasury banking laws cannot be immed-
a,ely amended or abolished. Chief among
them is the Anticipated statute preventing
| the retirement by the banks of more than
| s., 600 900 OF circulation per month. The
one great reason why the banks do not
| take out additional circulation in times Of
money stringency is that they are en-
abled to retire it so slowly that they must
| face the probability Of having to keep il
q, h..