New-York tribune., 1905-11-27
THE WEEK IN WALL STREET.


Irregular movements in values heavy trading
in all the active issues. liquidation by the minor
pools and weak commission house traders, buy
ing on the declines by the substantial interests
and we'll defined attitude on the part OF the
last named on the bull side of speculation "ere
the chief features of the week on the otoch
Exchange Outside of the exchange the easier
tendency In money rates was the conspicuous
development in the financial community Az
tenpts wers made to bring about sooo s|eu
reaction in prices and fortunately for the BEST
interest of the market number OF small poos
were compelled to sell their holdings. but II was
noticeable that the people who are most mt
uately connected with the almost glgah'io op-
erations that have taken place on the Seooh tA
change In the last few months were as ouihSn
as they have been at any time ehis year anN
willing to buy securities on all declines ihe
fact that gross manipulation developed III
number of shares did not shake the commence
of the big" men in their theory that quota
tions for securities ultimately will reach hlsh-
er level, nor did 1t deter many co1nfEilssioh
bouse traders from entering the market at an
admittedly high range OF values. STOCKS are
high by comparison. and in some cases II lnuse
be said that values more than measure the ac'-
ual worth of the investments. but noe"ltnstaiiu
ing this fact there 80 many conditions "ofA7
ing In favor of bull speculation that IL requires
an unusual amount of courage bolcly TO as
,,-ns the short side of the market One thing
is evident and It is that there is not a hfail-
cially weak public In the current market tne
tsv weak spots being made UP Of small pools
sna small outsiders who from time to time are
illuminated by unimportant reactions anu
whose operations help rather than inJure the
speculative situation
For a considerable period there has peen prao
ticaIiy worldwide construction in money put II
appears to be ending. In the last few DAYS there
has been an appreciabe relaxation IN money
In Europe and It looks II before long 1nere
would be comparative ease in money rates In aA
~. +oraien canitaIs In the United States the
tension has been greatly lessened, but rates rule
above those quoted in Europe, and are hkeIy I'D
do so for some time to come There are Two
purposes in keeping rates at this centre hisiioi
than the rates abroad One Is TO preciuoe 'ie
possibility Of gold exports and the other ls 10
impel borrowers for the present to seek accom-
mediation in the foreign exchange market ra1neF
than In the domestic money market Inc re-
serves of the banks in New-York and at other
money centres have been seriously depicted ever
since midsummer and there is now desire 10
rastore them to substantial proportions In
order RI build I'D the reserves It Is essentlal 10
prevent loss of cash by shipments OF goio
to the other side Of the Atlantic and to avert
at least impede. an increase in the loan ac-
counts of the banks. for when the banks make
loans they credit them as deposits. and are
therefore compelled to hold cash in reserve
against them. The exchange market has as
sumed a position where there is no difficulty In
preventing the departure of gold, and likewise
where practically free access is afforded TO Eu-
ropean capital In the existing state of ex-
change in other words. the transfer of gold
across the ocean would entail a deficiency, but
on the other hand. by reason of the decline in
money rates in Europe the exchange dealers are
enabled to put forth with profit their so-caed
finance bills.
Since the fall IN money in Europe began there
has been widespread shifting of loans from
the banks to the exchange market, and
also a fair part of the loans have
been negotiated in the exchange market The old
method under which the exchange dealers lent
their bills is largely out of vogue it now has
become the practice for the exchanges brokers
to sell their bills and lend the money derived
therefrom to borrowers. In this way the opera
ton is the same If the borrowers dealt with
the banks and when the loans fall due the bor-
rowers merely have to hand over certified checks
for the amount of their Indebtedness When
bills instead Of money are lent. the borrowers
dispose of the bills, and when the obligations
mature they are cancelled by delivery to the
exchange dealers of demand bills or cash at the
current quotation for demand bills, plus interest
and commission. If, is understood, the big
Russian loan is not to be foated until January.
Europe certainly has excess stock of money.
The Russian loan was to have been announced
in October but as is well known this pro-
gramme was upset by the internal Russian dis
turhences In anticipation Of the loan, gold was
amassed in Europe In prodigious quantity, for
which there will not be full employment at pres
ent While the japanese loan, which is on the
INT a] ay,oicS ak n h6
place of the Russian loan, 1t should be borne
in mind that the Japanese plans call for only
one-half of the amount that Russia proposes
to put out. Had the original arrangement for
the Russian loan been pursued, the Japanese
loan doubtless would have been deferred. From
the attitude of pecunary affairs at this junct-
ure there is as little likelihood OF an inflow of
gold to this country there is of an outflow
Fortunately there is need of bringing gold
from Europe for the United States as we'll as
Europe promises in the near future to have
an abundance of money. There has been
actual scarcity of money in this country in the
period of high money rates The trouble has
been that funds have been unevenly distributed.
Leading operators in securities-that is, the
men who have been behind the bull movement
on the Stock Exchange for the last few months
are well supplied with time money and a con-
sequence they are not at all worried over the
possibility of a pinch in money later on in the
year While money ought TO increase in amount
at this centre in the balance of the year, there
may be passing hurries in the loan market
but not of sufficient power TO create disturbance
in the financial community. The outlook sug-
gests caution in market operations but it does
NOT a naDfs