Evening star., 1905-10-22
THE INSIDE OF
WALL STREET
BY EDWIN LEFEvRE.

| Every now and then professional. Wall
street deliberately permits itself to indulge
| in delusions. OF itself that is not strange.
since Wall street men are after ALL human
beings. But the delusions in question are
remarkable because they are precisely
those which the ignorant public, indulge
fn and Wall street should know better
than the mob 1t happens particularly
when the street is at sea; in other words,
when it is guessing wildly and missing
every time. At the present writing, when
stocks f1uctuate within a narrow range and
the market fails, as 1t has for weeks, to
develop definite tendency. one 'texplaTa-
ton" after another is taken up. considered
and used until 1t fails to give satisfaction
to the user.
The average Wall street professional is a
curious type. He is human weather vane
changing with every shift of the wind Few
Of them have really strong convictions.
Very often they persuade themselves to
think they have. when in point of fact
what they have is merely strong prejudices
Some of them. to be sure, are nothing more
than gamblers whose minds change with a
rapidity amazing to the casual observer-a
quality, by the way, of which they are in
Ordinately proud and which they mistake
for a sort of sublimated judicial tempera-
ment Others are slaves of precedent and
tradition. The Legend" of the game Is
their supreme law. Always they would
measure what is by what has been. That
is, of course, logical enough and would
spell success If only they classified their
experiences logically and scientifically,
which they don't. To judge relative values
dispassionately, to weigh conditions and
factors accurately, to eliminate the ines
sential, that is what they think they al
yUa VIC IN h1Iti in, raql W n al
the various classes and types of Wall
street professionals in times of doubt fioun-
der about helplessly as the veriest
lambs. II verification were needed all that
would be necessary to do would be to take
a census of the men in the financial dis
trict who when they are bullish will listen
imperturbably to ominous hints or to force
fully expressed Skept1ciSm on the part of
anybody else. In nine out of ten cases the
bull doubts his own wisdom, especially if
for any reason or cause the ticker goes,
however trivially. the wrong way. Men
have gone busted by being stubborn they
will say apologetically, and the hedging
process follows. They also forget that men
have become great millionaires. by having
the courage of their intelligent convictions.
However, the point which it is desired to
emphasize is that ct the moment the aver
age professional is greatly concerned over
the attitude of the "big men," What object
have they" to keep prices where they
are? Or else. why, If the market does not
go down, do they not put prices up?
These questions are natural enough when
they come from rank outsiders, before
whose minds there is always the sinister
vision of perennial conspiracy, that of
the great American millionaires against the
great American pocketbook. The man
whose business life Is spent in the vicinity
of the New York stock exchange ought to
know better than the lamb, but at times
their minds work along the same fallacious
lines The big men may be very big, but
they are, after all, men. There Is some
stringency in money just now. The causes
that led to it were utterly beyond the con-
troll of the high financiers. They knew, like
everybory else, that higher money was
coming. They doubtless prepared them
selves for it. The thing they realized first
was that it would be a time for the exercise
of patience. They are not frightened be-
cause, much as they might like to see 1t,
the market is not going up by leaps and
bounds and the public is not devouring Sc
curities by the billion. "big bull market"
or, less technically, active gambling
spell, is not desirable for reasons clearly
evident to the most eXuberant of optimists.
Therefore the big men, who also are opti
mistic. do nothing to encourage it, They
couldn't If they would but, as a matter of
fact, they wouldn't If they could. The
'big man" who to the possession of brains
and money joins patience is pretty close
approach to a sure thing gambler, and this
is not because he is INSCRIPTIONS SO much
as because he is cold-bloodedly wise. In all
men the wish is apt to be father to the
thought. In few men there is also the
ability to see things as things are, and not
they would like things to be. The real
ization of this often hurts, and 1t is not
every surgeon who can operate ruthlessly
on his patient when the patient happens to
be his own self.
Wall street, like the rest of the country,
has, of course, long known that the power
of such firms as ]. P. Morgan & Co., Kuhn,
Loeb & Co. and Speyer & Co. came not so
much from the individual cash resources of
the firms themselves, but rom fthe possess |
sion of strong allies. The disclosures made |
in the course of the life insurance investi- |
cation are of especial interest to the street |
where light has been thrown the forma-
ton of syndcates by the big banking firms. |
For one thing, it Is shown that notwith- |
standing the popular belief that of late |
years all the stock and bond f1otations |
have been a matter of outra geously inflated |
values, there have been very few instances |
in which the underwriting syndicate mana |
gers have asked their pals to gamble blind |
ly or to subscribe for dangerously over-in- |
fated or dangerously over-watered issues. |
Proof of the truth of this is that out of |
twenty-five or thirty syndicates very few |
have been unsuccessful in the early stages, |
and very few of the securities have subse- ]
quently declined enough to justify the |
clamor of certain people that the principal |
industry of Wall street is the manufacture !
of gold bricks. Be 1t understood that by this |
it is not meant that the public has not been I
coaxed at times into listening to the siren |
voice of ticker to the extent of parting with |
a years income for the privilege Of imagin- +
ing for week two that millions were I
coming their way. AS bankers and syndi-
cate managers. the firms before mentioned
have been fairly moderate. AS individual
stock gamblers or members of pools the