Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-12-28
BULLS AND BEARS
Special Dispatch to The Star.

Y SPeSiAs DekNtcn 70 Iae StoI
NEW YORK, December 2S.-Tomorrow
viii be practically the last call money market
day In Wall street until next Tuesday.
Stock exchange contracts in stocks made
| on Friday are not settled until Monday.
Stocks bought or sold on Friday are not
| deliverable until Monday and call loans
| made on Friday carry over to Monday as
| we'll When Monday Is holiday stock and
money contracts carry over to Tuesday On
Saturdays there is practically nothing doing
IN call money; only casual borrowing OF
small amounts to adjust accounts in which
there has been bookkeeping error or to
margin up short stock which has advanced
In price. and these only when brokers have
failed to provide sufficient amount of free
money to provide for such contingencies.
by next Tuesday or Wednesday ut the
| latest 1t Is believed that the huge disburse-
ments for dividend and interest which be-
gin tomorrow and the preparation for which
mas tied up at least $i25,0tO,O61 this week
VIII make for material relaxation in the
money market. In addition, the cash and
creolts rocked up over the years end for
WINDOW dressing purposes will be released.
ana Few days later the normally large re-
turn flow of funds from the interior should
Degin In volume, especially as the interest
rates here are likely to be attractive with
OUT pefng distressing to those who must
| pay them
*.
III Is wrong to say that the considerable
| number of bank depositors who have ap-
peared In Wall street this week to lend
.neif iaie balances of from $4,000 to $780,
Wy AT the abnormal interest rates obtain
| ing or have caused their banks or other
| agents to place the money for them have
| not helped the money situation to any ex-
| tent The argument along this line is that
III these depositors did not put ont the
| money the banks would. The fallacy in the
| argument is in the fact that when money
| Is thuS loaned for the account of individual
| or other depositors it tends to displace or
| does displace loans for the account of the
| DahkS, thus reducing bank loans and de-
| posts and consequently lowering the
serve required.
1t may be that the cash thus freed Is
| made the basis for further lendings by the
| banks, SO that bank loans and deposits In
| the end show no material change but there
| has been in fact an actual increase in the
| supply of credits available for money mar
| ket purposes.
|
| There is eminent banking authority for
nate the period of extremely high money
| rates.
Men who are known for the sanity and
| sobriety Of their judgments say that they
| dare not contemplate the probable effect
| on industry and speculation of an agri-
| cultural outturn in 1906 such as was har-
vested this year. 1t Is doubtful IL even the
| leveI-headed have fairly appreciated the
| stimulus impaired by the crop yield Of
| 1906
! Taylor Smith in a market letter of the
week say:
''The year 1905, now drawing to close,
will doubtless be chronicled in history as a
year of proddgtous prosperity. During the
| twelve months, innnmerable records have
| been made. and the industrial progress and
productiveness within the borders of the
| United States have reached a point unpar-
alleaed by this or any country in the same
period of time. Our great prosperity has
only become assured In the last three
months of the year. not until the crops
were gathered and harvested and their bulk
| and value computed, so that 1t may be
taken for granted that the greatest results
to be attained from said prosperity, will
only begin to be realized with the opening
of the new year.
This signifies that the railroad and In
dustrial earnings will not only be main
tained. but should increase, and that the
full increments from these unprecedented
times may lead to further record brea king
conditions during 1906.
Accepting the theory that the United
States are whole, today, in the midst
of the greatest prosperity in Their history
1t would appear but natural that this con-
dition must be reflected In increased prices
for railroad and industrial securities and
that some Of them. If not all. should adj
vance to a higher level than they have ever
before rea ched.
IF this supposition is later on borne OUT
by facts many of the railroads and indus
trial stocks should at present prices greatly
augment the capital of their owners within
a comparatively short period: in other
words, there may be. and probably are, at
this time opportunities to purchase for
profits listed bonds and stocks uneQuaIed
in any other country or on any other ex-
change
Some statisticians figure that the pres
ent earnings of the United States Steel
Corporation show about II per cent on the
par value Of the common stock, more
than 25 per cent at the present market
price. Talk is now to the effect that the
net earnings next year should be around
$40, 600 O00 in which case the earnings on
the par value of the common might run
as high as Is per cent. 1t sounds rather
wild, but in certain confident quarters pre-
dictions are made that steel common Will