Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-12-31
YEAR CLOSED ACTIVE
MONEY RELIEF LOOKED FOR IN
DIVIDENDS AND INTEREST.
Little Attention Accorded the Bank
acknowledgement Maintained
Buoyancy Despite Cash stringency.

tainties over the money market. The alb
sorptiye power of the market, however.
proved good and the realizing was effected
without material damage to prices.
There were some decidedly feverlsh
movements in the closing dealings, when
hasty throwing over of holdings caused
number of rapid declines, followed In some
cases by rapid recoveries. The range in
Amalgamated Copper and Anaconda was
especially wide and rapid.
The immediate outlook in the money mar
ket remains much obscured. The greatest
reliance is placed for early relief from strin-
gency on the disbursement of the dividend
and interest due. for the payment of which
great funds have been accumulated.
The severity of this weeks stringency is
attributed principally to this preparation. 1t
is believed also that the accumulation of
resources by the trust companies for the
purpose of window dressing for the jan
uary l statement of conditions which is re-
quired OF those institutions has played an
important part in the construction of the
weeks money supply, and prompt relief is
hoped for from the release of funds aceu-
mulated for this purpose.
Some Apprehension.
On the other hand there is some apprehen-
sion that very heavy obliga tons contracted
In the course of the speculation may fall
due next week. especially in the foreign ex-
change market. and will require to be met
or renewed There was much discussion of
the proba BILE effect upon sentiment of tha
december charges for interest, which will
go out to the customers of stock exchange
commission houses next week and which If
IS renewed VIII disclose a high average of
carrying charges
Little attention was paid to the bank
statement. which conformed pretty closely
10 expectations in the cash changes The
IeaEltSt lending by the banks is supposed TO
nave Geen done toward the end of the week
ana thus would have q diminished effect in
whole. WEN "S d
Total sales of bonds par value, $1,97o,ooo.
Eagerness of Spectators.
speculation has maintained buoyant
confidence this week in face of the severe
stringency of the money market and of
one or two episodes that would have been
seized upon to upset confidence in ordinary
times. The eagerness of the speeuTatton
AFTER chatting impaticntly under the con-
straint of the high money rates and some
aegree OF forced liquidation broke through
an Expressive influences and there was
rush to buy stocks at rapidly rising nrlces
the demonstration was unprecedented In
the experience of the oldest operators ana
was viewed with unaffected anazement and
some degree of irrepressible anxiety The
rates paid for money on call at the stock
tAEi4dhge reached 40 per cent. and IL, per
cent was paid privately. In times past
S'e"N'i - ISL III the money rate has DTppinI-
lated heavy liquidation of stocks and even
IN the tull TIDE of rising marke. has
turned prices abruptly downward ana
thrown the market into pancky conditions.
ne most notable precedent was that of
btcehper. ls9J. when an animated specu-
lauon for the rise was interrupted by the
outbreak of the Boer war and heavy de-
mands upon New York for gold by London
Exhaustion of Bank Reserves.
The exhaustion of bank reserves here
which resulted and the necessity for call
ing in loans ran the rate for money on call
up to 1s6 per cent and forced a spasm OF
liquidation IN stocks to recuperate the
banking position. This weeks rate for
money was the highest touched at the stock
exchange since that time In September
or 1902 the strain on the oyer-eXtended
speculative position did not carry the rate
higher than 80 per cent in the panic of
May, 1901, precipitated by the Northern
Pacific corner.
The highest rate quoted was 40 per cent
On all Of these occasions the running up
OF the money rate was the signal for in
discriminate unloading of stocks, the rate
/of interest being regarded as prohibitive
of holding OF stocks on margin.
In strong contrast with these precedents,
the speculative position has been firmly
maintained this week. and rates for money
paid by speculative holders Various mo-
tives may be distinguished TO make up the
obstinate confidence with which the specu-
lative position has been maintained.
Confidence in Business Expansion.
Underlying them all is the conviction that
the conditions of prosperity in the country,
already beyond all precedent. are destined
TO a further indefinite expansion 1t is as
serted that an enormous pGJeur dl but WA /
ing demand for securities exists in the
country. which will be melted by the grow
ing evidence Of this prosperity and which
will develop in the stock market when the
seasonable requirements of the money mar
ket are satisfied and when funds begin to
flow back into the channels of bank
serves
1t Is the conviction Of the followers of the
speculation that the great capitalists of the
country have organized their forces and
provided themselves with means. tndepend
ent OF the eNigencies of the call money mar
ket, TO take advantage of any forced sell
Ing on the part of the less fortunate hold
erS TO accumulate 81 u.-t.-S
The expected coming demand for stocks
is relied upon to absorb present holdings
and 70 advance prices 10 an extent that
VIII pay for the .. PEI 80 s-.
day which present interest rates amount to
in addition to the prices now paid for
stocks.
Relaxation is Expected.
The position implies reliance on a prompt
after the year-end requirements are met,
which will put short limit on the present
exhausting rates paid for interest. Rumor
2ad urverihed assertion of expected meas
ures OF RELIEF of the money market have
played part in keeping up the speculative
excitement and in encouraging the disre-
gard of present money difficulties.
Incessant reports have been circulated
OF the intention Of the Secretary of the
Treasury to deposit large amounts of the
government surplus in national banks. Ru-
mors were current of the formation of a
money pool among the great New York
banks 10 provide fund for lending in the
stock market. as was done In the period
of stringency of 1902.
A tacit agreement was alleged among
banks and great money lenders to restrict
the rate demanded on standing call loans
until the passing Of the crisis. These fac
tors combined to protect the stock mar
ket freln damaging consequences from the
stringent money market.
Causes of stringency.
The causes of the stringeney are sum-
married as great activity In trade and ex-
pansion in enterprise IN all lines, delayed