Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-11-12
Liquidation Marked Dealings
at Close of Week.
RANK RESERVE DEFICIT
STATEMENT OF AGRICULTURAL
EXPORTS SHOWED A DECREASE.
Prices Carried Lower by CONSTRUCTION
of Money supply-Refundlng opef-
atoms at a standstin.

fiCit of g. AS. SEQ below the - pei
Gal reserve of the banks, some lquio"..OH
came upon the stock market TO-DAY ai'e'
the bank statement appeared on 'he '"pe
But the selling showed no signs VI p'S
c,n,,ancv and was conducted in an orderly
manner and in the late dealings some RAJ
rim tendency was perceptible. The clos
ing tone, however, was unsettled anu II
regular, Early in the day the market gave
evidence of support, and some OF the III
dustrial stocks and specialties were pusheo
upward aggressvely. oo,
The reported loan contraction of Sl3''s+'-
coo was said TO represent only partly the
,Ioui5ation which has occurred in the STOCK
market during the week, bankers assert
sng that loans have been called to large
extent also for account of out-of-town IN
stitutions which had placed loans IN the
stock market. but which recalled credits
for use In their own localities 90, = -..
Tho decrease of nearly S11,oo0,GOo In cash
holdings was rather larger imam Pisnsst.
nary estimates. The last previous ueIcil
IN the legal reserves shown by the clearing
house banks was in December or lSo2' IRE
Ceding that the only deficit since the year
1s02 occurred In November, 1922 at when
time the banks ran along FOR SeVeral "eehs
below their legal reserve limit.
Both of these periods are OF eVii memory
in stock exchange experience in DeSeGn-
her 1907. the situation WAS tOlIStA W ~
the formation of what was called at the
time the $4,000 600 bankers pool, when
announced itself prepared to lehd that
amount of money If the stringency IN the
market should become dangerous. Inc sue
cess of this measure in tranquiilzing ihe
situation was denomlnated in the dlScussloh
of the period "a faith cure.
In the December of 1899 violent strlhsehGy
of money finally carried the call loan rate
momentarily to a figure of 1856 per cent.
Both the money and exchange markets
were nominal today, but loans were report
ed to have been made at rates much below
Yesterdays high level The foreign ex-
change market was called steady. There
was a shading of discount rates both at
Paris and Berlin, but no change was re-
ported in London.
Agricultural Exports.
The statement of agricultural exports
from this country for October shows de-
crease OF s., 665, 1888 in value compared with
October of last year. a heavy decline IN
value of cotton exports amounting to about
double the increase in exports of bread
stuffs This showing goes to explain tA'
resistance in the foreign exchange market
TO the influence Of the violent rise In money
rates here. - ,o- ooo
Total sales of bonds par value, 81 $50, ooo.
The sharp construction OF the money sup
fIv and the recall of credits from the stock
market thus made necessary have resulted
in LIQUIDATION of securities this week, wmch
has carried prices Complementary 70
lower level. The movement was irresuLaI
and INTERRUPTED by occasional rallies, ana
the market showed considerable resistance
OF times during the week. But the rise III
call money rates to a level higher IMAM mas
been touched In two years and mar up
set the composure of holders ana piousHI
stocks freely upon the market.
on Monday the market was lttle us
turbed Notwithstanding the plain .lntina-
ton carried by the Saturday pahA STAY
,r,rof~s ct
hanks would be necessary to keep WltlIh
their legal reserve requirement
Weakness Was Distributed.
The weakness developed on Wednesday
after the election holiday and was d.strib-
,,ted in about equal part to the money
situation and to a feeling of uneasiness
among the speculative element that the eff
ta.t ~ the elections would be to strengthen
and encourage the pushing OF pohcles III
rected against corporation prlVIeses. fo,,
This was revival Of an influence leL. .
I'm the stock market proceeds or the recent
rayrlations of abuses in the conduct OF cor
porations. which 1t was feared occasloheu
distrust among the Investment GLASSES 70
the detriment of the demand lor ~
ties With the course OF the week tHe
money question came TO dominate All olneA
considerations. ~ .i,
The warnings of possible money strln-
sency contained in the course OF lhs jain
ing uQgLtlOQ mas Deeu Bplh.N 46A'SA - -
q ypressiye speculative element in the STOCK
market Operations for an advance nave
been followed up with professions OF con-
fdence in the maintenance or easy money
rates and ample supplies Of funds to sus-
tain a speculation based on the eXtraordln-
airy prosperity existing in all departments
Of commerce, industry and agriculture
Basis for Confidence.
This confidence was based in part on the
nssuupfiou that the demand of the interior
Tor funds would be satisfied with the turn
Of the month OF October according to the
precedent OF most former years. On the
contrary, the movement of funds to the In
terror has been renewed with extraordinary
force in the last two weeks, and the with
drawals from New York have been larger
in volume than in any previous similar pc
Rod for the season.
The consequence was the reduction of the
surplus reserves of the banks. as shown by
last weeks statement, TO less than S2on,-
Cll while the further losses by the mludIe
of This week were sufficient to reduce the
cash holdings Of the banks below the iegal
reserve limit 1t is evident also from the
event OF the week that the speculative
forces conducting operations In the mar
Ict has counted confidently on the inter
Veution OF the Treasury Department TO re-
plenish the New York money market oy
the redepOsit of government funds with
drawn last July, in the event of any threat
OF stringenCy Of money.
The stock market developed its acute
phase OF weakness when II was announced
after visit OF Secretary Shaw to Wall
street that he saw nothing in the money
situation 10 call for measures by the
Treasury Department
The Treasury Cash Balance.
The fact that the governments excess OF
expenditures over receipts since July has
run to over S15oOO,OO0 has left the treas
ury's cash balance in no better condition
than when IL was considered advisable to
TepleniSh it. by the withdrawal of deposits
with national banks. Since that time also
the operation OF the refunding offered by
the treasury has increased the supply of
bonds available TO secure additional bank
note currency.
The refund!ng operations have come al
most TO a standstill, thus conveying an I'm
preston that the desire of the banks to
increase their note has been satisfied
When the tone Of the time-money market
and for commercial loans has grown firm
and rates have advanced moderately there
is no evidence OF stringency In those de-
partments. Speculative sentiment has ar
rived at the conclusion that measures of
relief by the Treasury Department will
depend on the evidence OF deficient faciIi-
ties for conducting regular business and
not on the needs OF extended speculation.
Mo- nj tine he