The sun. [volume] (New York [N.Y.]) 1833-1916, 1905-03-27
THE FINANcIAL sIruATIOM.

ooluOul IN the history OF NlG bbOCh ulAiAo'
has there been a decline in values similar
70 that which occurred last week, TO which
there attached, as there did to last weeks
movement, such a consensus that It wal
justified. Not simply the 'old time" ele'
ment in Wall Street and observers OF the
conservative class, but the great mass Of
experienced critics Of every description
had agreed for more than fortnight back
In oharaoterizing the market as being
II the use Of somewhat mixed but eI'
pressive metaphor may be pardoned-
waterlogged at the top. The public were
obviously finding prices Of stocks too high
for them to buy-even II these prices did
not tempt sales on an extended scale OF
stocks held for investment-and we're cur
falling an interest in the market that had
at no time been great. The heads Of The
lea ding commission houses we're all sdVis-
ing their customers to exercise moderation
and prudence in their ventures on the
buying side. The strictly speculative por-
ton OF Wall Street was getting weary OF
rumors Of deals Of one sort or another that
never materialized, and fear and sceptioism
concerning the position Of the market were
rife, even IL no pessimism regarding the
general business situation was felt. The
potential force Of these circumstances only
needed. as others like them have only
needed before, some particular development
to make the force effective, and this was
supplied In the slight movement Of money
rates In the direction Of a higher level and
by the indications that the bond market
was losing little Of its snap and firmness.
In view Of all this there was but one thing
for the pools and other speculative inter-
ests who had been advancing the price OF
stocks 10 do. II they could not liuuidate
the whole or a portion Of their holdings at
current prices they must mark prices down,
just as any merchant would do with goods
that he found difficult Of sale When the
selling Of stocks began there was plenty Of
help given 10 the operation by spectators
who had long been unfriendy 10 the rising
de Of values. So.we had the sharpest break
in security prices that has been since the
lawson disturbance last December. and
while sentiment at the end Of the week
was more cheerful than it was at the begin
ming Of the period, it is not unfair to say
that the greater number Of those giving
their daily attention 10 the ebb and flow
Of stock market fluctuations held the opinion
that from now on the market would be a
two sided affair.
Discussion Of the situation from a specu-
lative point Of vi6w reduces itself practi-
cally TO this one question: Has the re-
cent reaction in the market been merely
a reaction and did il shake out with suffi-
cient thoroughness stocks weakly held by
small pools and lesser spectators, or did
il mark the end Of the upward movement
in the market as a whole for a considerable
period? Manifestly this is question
that no one can answer with certainty,
since he who could do 80 would possess
a good deal more than human wisdom.
But there are yet some things that seem
clear; that is, If the experience
Of the INast is longer calculated 10 be guide
to such things at all Much, it would neces-
sarily seem, regarding the future course
Of values must depend upon the degree Of
fact that attaches TO the deal stories Of
which so much has been heard. The under
lying feeling is that business and financial
matters in this country just now are in
strong shape and bid fair to continue so. and
that there is no hammer raised that IA likely
to give the market a blow. If, therefore.
some. even IL not all OF the current tales Of
holding companies, guar
antees Of dividends and similar arrange
nents are found 10 have substantial
basis. II is not at all impossible that
the revelation will give another flip
10 speculation and that PRICES Of stocks
will go higher; and, on the other hand, II
A long period Of uncertainty regarding
these matters is again to be experienced,
suspicion regarding their variability IL
lpt to be again engendered and TO produce
another fall in market values. Few people
will deny doubtless. that there are many
stocks in the market now selling at prices
altogether too high II there ia no deal TO
account for them. And there il, Of course,
The possibility that when the details of
some Of these deals are fully made known, il
they are made known. Wall Street may con-
slider them mot as good as expected, and
will manifest its disappointment in the usual
fashion The story Of this kind that has
been the subject Of more comment than
anything else has been that Of the supposed
holding company, which, II Is
thought, will also include the taking over
Of the New York Central property by the
Union Pacific Company or vice versa. Hos
tile criticism has already attacked the idea
Of any holding company that would at
tempt 10 take over or guarantee dividends
upon most Of the Vanderbilt stocks at their
present prices. while those who should
know about these matters assert that, 80
far as any alliance il concerned between
Union Pacific and New York Central more
oten than that which now obtains, no one
need look for il until il can he seen what
President Roosevelt's extra session Of Con-
gross in October il going 10 do about the
railroad freight rate matter and until It APP
pears also how the Western railway situa-
ton will resolve itself after the dissolution
of the Northern Securities Company. Il
must appear plain to those who look n this
situation viii any degree Of carefulneSs that
the most interesting feature Of II is that
pertaining 10 the future Of the Chicago,
Milwaukee and St Paul Railway Company.
It can hardly be supposed that with the
Burlington and the Northern Pacific in the
hands Of its rivals. the St. Paul will choose
to remain in its present landlocked posi-
ton. and right at this moment the prob
abilities are that the 81. Paul will build 10
the Pacific Coast.
Regarding the money market il can only
be repeated that our hest bankers do not
look for anything that can be called ac-