The St. Louis Republic. [volume] (St. Louis, Mo.) 1888-1919, 1904-02-07
BANK LOANS MORE POTENT
IN WALL STREET THAN WAR.
MARKET EXPECTS LARGE
DEMANDS FOR MONEY.
Borrowing Already Almost 81
600, GOO 00 and Many Require
ments Are to Be Met.

days stock market indicated a feelin:, Of
greater apprehension over the subject OF
bank loans than over the impending war
iii the FAR East. Prices rebouaded from
the slight opening depression reflected
from foreign stock markets. where the
hope OF Il peaceful outcome was reported
practically abandoned. The borrowing of
So, .00l.0 600 10y the Pennsylvania Company
induced heavy selling of Pennsylvania
Railroad stock, the latter company own
ing the stock of the borrowing corpora
ton. This loan and the fear that it was
Il prelude to similar heavy borrowings by
other railroad corporations caused a
marked impression on sentiment all
through the street. The loss in Pennsyl-
wanna itself reached IA at the lowest price
of the morning. Wabash preferred was
notably firm. IN spite of tine official dis
Chalmers from Pennsylvania sources that
the loan was to figure in any settlement
of differences with the Wabash. United
States Steel preferred also showed con-
sp2icuous resistance to the weakness else
where manifest. The tone Of the market
underwent a marked change after the is
suance of the bank statement, and this
was clearly due to the moderate eIpan-
sion shown by the loan item, which was
not large enough to wipe out the narrow
margin below the billion-doll mark at
which the clearinghouse loans now stand.
SMALLER.
The effect of the bank statement was
made the more clear by the fact that the
cash reserve of the banks showed a de-
crease of s., 1888. 100. where an increase of
almost equal amount had been indicated.
The Inference drawn from the small inn
preston made upon the loan item by the
large money market operations of the
week was that large corporate require-
ments had already been provided for by
fhn Inap Erp mir oInN fIn
first of the year. Pennsylvania rally left
its net loss less than a point and United
States Steel preferred and Wabash pre-
ferred finished the day about a point high
er than last night. The closing was firm
and practically at the best prices.
EFFORT ABORTIVE.
The course of last weeks market eeemed
to be accepted by operators at the begin
ming of this week as a satisfactory demon
stration that the attempt to bring about
a speculative revival for the advance had
proved abortiye. The market has de
nave been any longer apparent to lift
prices or to attract a general demand.
The market has moved sluggishly and
irregularly. but the average tendency has
been ~downwardS. The abandonment of the
campaign for the rise was partly due TO
the appreciation that the period OF re-
dundancy of money was passing by the
normal course of events. But the market
has been overshadowed also by several de-
velopments. and the news of the week has
contained little to encourage an upward
movement OF prices. The approach Of the
crisis in the question of peace or war be-
tween Russia and Japan has overhung all
the speculative markets with growing In
f1uence. Foreign securities have been al
most S%tagnant on the eve OF the momen-
toUs decision and the most notable effect
on our own stock markets has been one of
conStraint upon operations rather than OF
weakness. The principal speculative activ-
ity has been diverted TO the commodity
markets. and the excessive commitments
in those markets have made them fever
iSh and sensitive TO the slightest causes.
VIOLENT FLUCTUATIONS.
AS the threat of war was recognized as
one of those causes. the violent fuctua-
lions in the commodity markets empha-
sized the impression of the possible effect
of war upon securities. Besides this re
flected war influence from the commodi-
ties. the unstable condition of values In
those markets had its own direct inf'u-
ence in exciting uneasiness in financial
quarters and il beGetting a conservative
spirit.
spoke a elimination of wild speculation
there. and the collapse during the week
gave warming OF extensive speculative
losses. such as are bound TO have some
effect in the Wall street market for quick
liquidation. from whatever quarter they
may come. The coffee market was an
other. though a less important. source for
tfllS hiItu VI lllllttil't. iidItt dllu tiluusN
trial reports have been of a kind to help
in sustaining values. The returns of rail-
road net earnings for December compare
unfavorahly with December of the pre-
ceding year. showing the effects Of the
growth of operating expenses in nearly
all cases. The Southern Pacific statement
was a notable exception, owing to the ap-
proach to completion of its extensive out
lays for improvements, which have been
coming out of net earnings for a long
time.
STOCK NOT HELPED.
This exception did not benefit the stock
of that company, while the Pennsylvania
showing from the falling off In iron and
steel traffic was used with effect to de-
press that stock. Rumors Of additional
new capital issues b. the Pennsylvania,
which were at first denied. We're also a
factor in causing the decline in that stock.
The returns of gross earnings for the
fourth week IN January. so far as re
ported. show a decided falling off from
the corresponding week of last year. the
average decrease running to over IL per
cent. Snow obstruction and bad weather
H iaSi ,s,c are .E Elvsn a as 5hs cause" canse for n
rise in the ratio Of operating expenses as
well. causing apprehension of unfavorable
net returns to come. The low tempera-
lures and the absence of snow covering In
the Southwestern winter wheat belt is
commented upon and is an unfavorable
influence upon grain-carrying railroads In
that locality. Business failures Tor the
any month since May. 1900; with the ex-
ception of last December: In spite OF the
severely cold weather the mining Of an
thracite is being curtailed to avoid an ac-
emulation OF stocks and the wage dis
pute between miners and operators or BIZ
luminous coal has given rise to threaten
ing talk Of a great strike to come.
IRON UNSETTLED.
Definite news from the iron and steel
trades has been lacking, but rumors have
persisted OF Il coming cut in steel rails.
of concessions from schedule prices in
other lines of finished products. The price
of copper has yielded in spite of January
exports in excess of all previous records.
The announcement OF a decision by the
Montana Supreme Court favorable to the
right of the Amalgamated Copper Com
pany to hold stocks of other corporations
resulted in Il elimination of a speculative
movement in-that stock. The death of
william c. Whitney was a depressing in
fiucnce upon various stocks of companies
in which his interest and influence had
ly to New Orleans during the week and
interior exchanges have moved agains:
New York. This development has had
added influence by reason of the notice by
the Secretary of the Treasury of n call in
ten days for payment of 20 per cent of
Government deposits in national banks to
provide for the Panama Canal payment.
The extraordinary figure at which New
York bank loans now stand and the prom
Use of additional requirements for Ger
poration purposes prompt a conservative
use of credits for speculative uses.
Bonds haye turned heavy on a dimin-
ished volume of business. United States
2s, the IS coupons and the old 4s have
declined u per cent on call during the
week.
Domestic Exchange.
Reported by Whitaker & Co. exchange bro
kers. No. coo Ncrth Fourth street.