New-York tribune., 1906-09-17
MONEY AND BUSINESS.

Instead of the wholesale liquidation in the
stock market which seemed warranted by the
heavy deficit in the bank statement OF the previ-
Gus week. securities opened on Monday morning
IL nothing had happened. and further ad-
vance produced as the various gold engage
ments were announced. After such an exhibition
OF power by those who have taken the helm in
Wall Street, It is surprising that any one has
the temerity 10 take a position on the short side
of the market. Yet II is just these rash operators
who have contributed much to the recent high
level Of prices by putting themselves in a posi-
tion where they could be forced by clever manip-
ulation to cover contracts on a rapidly rising
market. The mere fact that the technical situa-
ton suggests that prices of some stocks are too
high is proof that they cannot be forced still
higher. Late I'm the week rumors OF a coal deal
started purchases OF those properties. Reading
leading the advance with sensational strength
and activity. and the short account was again in
distress.
Much more gold secured abroad than con-
servative bankers expected rates OF foreign ex-
change ruling remarkably weak when some ma
terial recovery seemed almost inevitable. Europe
also showed less opposition TO Withdrawals Of
gold than was looked for. and the net result Of
all factors was a decline I'm rates for call money
10 aNnOre nearly normal position. although time
loans continued above the legal maximum. At
best. this movement OF specie can be regarded
only a temporary palliative. because this
market already heavily in debt 10 Europe
and merely increased the obligation 10 the ex-
tent OF the gold imported. While II is true that
the season OF liberal exports OF farm produce is
just opening and foreign demands are expected
10 be unusually large. there viii be the offset
OF unprecedented imports. which means less
than the customary favorable trade balance on
merchandise account. IL is not possible 10 ba Sc
estimates upon precedent this year owing TO the
fact that conditions are exceptional The nation
is so phenomenally prosperous that imports Of
luxures and materials of manufacture must be
greater than ever before. and. on the other hand,
home demands for domestic products should in
crease to an extent that will reduce the surplus
TO be sent abroad. Consequently, It is not rea-
sOnable to count upon the normal favorable
trade balance To settle an Indebtedness incurred
abroad in effort 20 maintain speculative prices
OF securities.
This matter OF the movement Of merchandise
ana the position of foreign exchange rates can
not be lightly waved aside as unmportant. be-
cause 1t promises 10 exert a very powerful in
fiuencs the financial and commercial situa-
ton during the next few months. Each week
Of late. it has been most noticeable In statements
OF foreign trade at this port that exports shove
little or no increase over corresponding figures
last year, while there was a pronounced gain in
imports. The domestic trade situation is all that
could be desired. however. fall trade at the lead
ing centres being fully equal to .anguine ex-
pectations. and IL is the exception when any in
dustry section fails to report better conditions
than at the corresponding date last year In a
few instances the fluctuations in prices OF raw
materials conhne purchases 10 current needs but
as q rule contracts cover remote deliveries and
there Is little effort TO force concessions I'm prices
IInseasOnably high temperature advanced local
prices for milk and eggs and some kindred
products before the usual date, and there is some
complaint regarding the effect or the high money
market upon collections but favorable reports
are 20 largely in the majority that confidence In
the future remains unshaken.
Commodity markets have not responded extern
sively 10 the numerous Official reports that have
appeared. although the preceding narrow fuct-
uations were attributed by to a dispOs-
tion 10 await government figures before starting
any aggressive campaign The figures Of cotton