The Birmingham age-herald., 1905-03-27

foreigners and which have been held since with the proceeds of loans in this mar ket. These loans are now being paid off and the securities taken abroad to be held in cheaper foreign markets It F said by authorities in the exchange mar- ket that this process of delayed payment on foreign purchases of securities is the principal factor in the present sharp downward tendency in the prices of for eign exchange. London discount hardened today and sterling rates declined at Ber- lin. The total shares of bonds, par value, g. 550,000.
 Stocks have been frequently liquidated during the past week, and the decline in prices which was extended by the manip- ulative effects of the bears curbed the turning of stop loss orders and forced offerings upon the market by impairment of margins.
 The reaction was regarded with com placence as normal after the extent to which the previous rise had run contin- ue usly and the shaking out of the weak accounts held for purely speculative pur- poses was felt to add to the health and soundness of the market. The rectifica tion of some of the excesses in the price level which had resulted from the un- bridled enthusiasm of the speculative
 
 with satisfaction. A quieting of the mar ket for stocks at this season of the year is, according to precendent, owing prin- cipally to the reasonable demands upon New York money market for the spring requirement of the interior trade. There have been some holding of securities in- duced by the merely nominal rates of interest which have ruled for today's funds, the rate of return on securities a fa Q ierh wal Of market prices, affording a margin of profit over the carrying charges.
 The advance in the call loan rate from per cent or below to above per cent, was sufficient to prompt the closing out of some such accounts without causing any fears of what would be called money stringency. The high level of prices for stocks ruling which offered handsome profit on such holdings. as was acquired in the early stages of the advance, was ar additional incentive to convert these holdings into cash. While the supplies In the money market was not greatly re- stricted leaders were less inclined to en- courage borrowing for speculative pur- poses and expected somewhat closer se- curity for the collateral offered for such loans. There can be little doubt that this condition lay back of the reaction in stocks. With the reaction in force there came also the natural shift in the spec ulative temper in the mood which events were accepted.
 There was little change in the events themselves, operators watching market transactions closely from hour to hour though they detected selling for account of the same parties of capitalists whose previous buying they had attributed to accurate information of the coming com missions, dividend increases and other similar factors which have been potent to lift a long time past The denials and disclaimers of these rumors which came out although having no greater color than those which appeared during the progress of the excited buying, acquired new credit with the selling in evidence and prevailed on the market followers Of the movement to unload their hold ings.
 There was large element whose selling during the week was no better inform ed than their buying had been and the action of the market threw little addi- tional, light on the question of the reality or falsity of the reports long current of great projects working out in the railroad world. That the stories still have vital ity was clesriy shown by their renewed influence in railing the market after the liquidation had spent its force Another effective factor in rallying the market was the course of the foreign exchange market Wnlcn OHereQ abundant evidence that recourse was open to foreign money markets to supply any needso our money market. The large falling off in late months in the trade balance in our favor had left this open to some question. But 1t Is now evident that the usually heavy reserves of foreign money markets will include supplies to New York on demand The growth of a belief in a coming peace adds to the relaxing tendency of foreign markets News of the week has yielded the placing of large blocks of new bond issues with foreign purchasers.
 Another method of relief for the local money market has been the transfer of stock holdings to London to be held there for account of American operators. with funds borrowed in the cheaper London market Foreign banking houses have also lent money in New York through the medium of the exchange market. The allotment of full half of the new sl5o,- COG. 900 Japanese loan to American sub scribers is accepted a striking demon- stration of the abundant capital resources of our markets in spite of the present expansion in our money requirements. The routine news of the week has shown no change in the highly prosperous and ex- banding conditions of trade in practically all lines which form the underlining sup port for the securities market.
 The shrinkage in the demand for bonds