The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1904-07-24
Review Of the Week.

Review Of the Week.
Tie stock market has been very ir-
regular throughout the week and its
occasional strength has been mani
tested in a very spotty manner. The
impression made upon speculative SEN
timent, however, has been TO increase
confidence in the underlying strength.
Professional operators have held to an
opinion that normal reaction after
the considerable rise in prices was
overdue and Ike. attitude toward
the market has been one OF constant
suspicion. IT IS usual for the securities
market to be left top heavy after so
considerable a speculation for the ad-
vance as that which has carried prices
to their present level and the first sign
Of reaction is likely to bring upon the
market a flood of belated profit taking
or sales by speculative buyers at the
top TO save losses with the sold out
bulls adding sales on the short side TO
force the reaction and get back stocks
at a lower level. While TIE week s
market has shown many signs of in
stability and prices have wavered
constantly, the movement was IS con-
stantly stopped short of precipitate
decline. The effect has been to i'm
press sentiment with the strength Of
the forces behind the market and to
encourage hopes Of an early resump-
ton of the advance. Ike small effect
produced upon prices by happenings
which seem to have a positive bearing
against values has the same encOur-
aging effect one Of the most notable
features Of the present rise in prices
has been the Indifference toward news
developments. Thus during the past
week there were numerous incidents
that would have upset speculative
confidence in an ordinary period Of
doubt and uncertainty. Monday morn
ing brought set of opinions from
western railroad traffic officials which
plainly admitted their apprehension
that the crop damage had caused a
halt in the revival Of confidence in
business which threatened another
period Of hesitation and curtailment
with resultant effect on railroad traf-
fic.
The crisis suddenly developed in TIE
returns between Russia and Great
Britain over the seizure of vessels in
the Red Sea revived all the worst pO-
tentialities of spread to the great
powers of Europe of the armed con-
fiict in progress in the far east.
At the meeting of the Northern Sc
eurities directors the unceremonious re-
fusaI TO even consider a cOnciiiatory
proposition looking to a settlement Of
the dispute between the stockholders
out of court gave strong ground for
an assumption that the issue Joined be-
tween the two parties of the control
of the Northern Pacific and of the
Northwestern railroad situation can
only be settled by the success of one
or the other party.
There is no question IN American
financial affairs which has caused so
much dread and anxiety as this Yet
this weeks incident had a stimuIat-
ing effect rather than otherwise upOn
the market. The blunt assertion By the
leading organ IN the iron trade that,the.
improvement had been taking place
chiefly in Wall street did not prevent
United States steel preferred from sup
plying one of the principal sustaining
influences in the market The damage
TO the wheat crop. in the southwest
was similarly ignored on the stock ex-
change. In looking back over the re-
cent upward movement 1t is easy to
perceive what a dominant influence has
been played by the Union Pacific. The
dimensions OF the transaction and the
extent of the movement in this stock
carry conviction that the insiders and
banking interests in the property were
concerned in the dealings This in
wolves one of the principal groups of
capitalists which make up the dOmin-
ant control of the great railroad and
financial institutions of the country. So
signal a demonstration of confidence
in future values 3 s was implied by this
operation undoubtedly did more to in
still feeling of confidence into the
general temper than any independent
study of conditions and the drawing of
differences would supply. The advance
has proceeded under the confident as
sumption that it was following well
informed leadership.
The plethora of the money market
has been a contributing cause Some
anomalies IN the money situation have
not escaped discussion. however. The
congestion III New York is seen to be
largely influenced by conditions in the
local banking competition. Induce
ments TO deiosit both by outside banks
and trust companies and by individual
depOsitOrs remain in force in the pres
ent stagnant money market and throw
the burden upon the New York banks
of finding employment for idle reserves
in order 10 meet the charges for inter-
est allowed. while also Increasing tao
obligations upo nthem for meeting III
innate reserve requirements. Obliga-
tons by New York banks % other
banks and bankers are larger even thar
usual so that interior needs for the
crop moving viii enable outside banks
/ to draw more freely than usual OF
New York reserves. The large increase
in the taxes OF government expendi-
lures over receipts has led to a semi