Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-10-14

strongly from new 1Ork 10 the
Discounts rose again in London today and
the Bank of England parted with $780,
COO more gold to Egypt. The foreign ex-
change market is merely nominal in New
York on Saturday. but the quotations for
sterling exchange today were. reduced one
fourth of a cent in the pound sterling. Re-
ports to mercantile agencies showed con-
tinuance of the close activity in all COM
mercial departments. and the weeks bank
clearings show no subsistence from the high
level of exchanges in the country's money
markets.
The market closed heavy. with insigntf-
cant rallies from the low prices. Total
sales of bonds, par value. 81 ,O92, OGO
Weeks Movement.
The aggressive advance in a few stocks
on very large transactions this week has
carried the whole market with it. but to
q much more moderate extent than In the
leaders. Dealings in the general list have
been small and the movement narrow.
The heavy dealings In the market leaders
also have been in very large individual Or
ders, and have carried the suggestion of
participation in the market by operators
Of a powerful class who concentrate their
dealings in few stocks.
The gossip from the stock exchange has
given specific causes for these conspicu-
Gus movements. in most cases, but au-
thentic Information as to the causes gen.
orally has been lacking. Unconfirmed ru-
mors realt with proposed dividend increases
and property combinations and readjust-
ments and with conditions of the proper
ties said to be preparing for public an
nouncement. but which were not so an
nounced. Such were the assertions Of in
tentions already formed to raise the divi-
dend rates on Pennsylvania. United States
Steel Amalgamated Copper. American
Smelling and other stocks which were made
credible by the we'll known facts of the
prosperous conditions enjoyed by those
companies.
General Outlook.
Old rumors were revived Of the coming
into closer relations Of St. Paul and the
Hartman railroads, and of intended mer-
gers Of the great corporations In the cleo
trical industry. The ore deal continued
to exercise an influence on the specula
ton by the far-reaching consequences of
that transaction on the future Of the United
States Steel Corporation. All such reports
of developments favorable to various prop
critics were made plausible by the continued
news OF the prosperous course OF the
countrys business. Industry and agricul-
ture. The countrys bank clearings con-
tinue to show an unprecedented volume OF
the money exchanges in the conduct Of
commercial transactions. The government
crop report for September is accepted
demonstrating the existence of q corn crop
of record proportions. a wheat crop second
only to that OF 1901. and satisfactory Yields
OF other grain crops. The cotton crop out
look IL not SO favorable. damage by
storms and by early frosts threatening the
harvest and leading to an excited specu.
lation In that commodity. Railroads In all
parts Of the country report an overwhelm-
ing freight movement. reaching the pro-
portions of congestion and blockades in
many places and with danger of greater
embarrassment as soon as inclement wealth
sets in. The years very large additions
to railroad equipment has failed to supply
adequate means for caring for the flood
Of new business. and enormous orders for
the earliest delivery insure the railroad
equipment companies full employment for
months to come These conditions overflow
into the iron and steel trade. where every
energy Is fully employed to meet the ris-
ing demands upon all resources The de-
mapd for copper Is reported TO have ex-
hausted all supplies that can be secured
for delivery several months ahead. and the
rise Of that metal to record prices has
Induced active speculation in all securities
connected with the industry.
Money Requirements.
The conditions thus outlined serve to ex-
plain clearly enough the extraordinary de-
mand for capital and credits which has
held our own money markets at a tension
for several months past. with a spread Of
effect to the money markets Of the whole
world. The past week has witnessed the
advance in the official discount rate of
the Imperial Bank Of Germany from per
cent to 6 per cent. followed by the rise
in the Bank Of England rate from 4 per
cent to per cent. The direct responsible
ity of this country's enormous requirements
for this evidence of construction of foreign
money supplies cannot be doubted.
The Bank Of England delayed as long as
possible the advance in its rate In order
to protect home trade from the disadvan-
tages of higher money rates. It's proportion
Of reserve to liability had fallen. according
to this weeks statement, nearly to 30 per
cent. and the drain was still undimnished
in force.
It is evident now that bold and determined
measures were taken early In the year on
the part Of far-seeing fnanciers in this
country to secure extensive credits In for
eikn money markets and thus relieve the
strain upon our own banking resources.
American finance bills to volume of sew
eral hundred million dollars are known to
be held abroad. American securities were
transferred in heavy volume to foreign
markets to be held with money borrowed
there or were deposited with agents in
New York as security for foreign borrow
ings without the necessity of actual trans
fer Money. nevertheless, became stringent
IN New York early in September. and New
York began to draw on London banking
reserves, which were the basis of the cred
its already extended to New York. This
process made inevitable an extension of the
money strngency from New York to for
eign money markets.
Foreign Bank Rates.
The rise in the Bank of England rate is a
peremptory measure to check the drain
and to attract money to London for the
replenishment OF depleted reserves. The
prompt rise in the sterling rate in Paris to
the gold export point indicates what prob