The Washington herald., 1906-10-21
WALL STREET NOTES.

part 81 the week ms DttN pflHclpdtiy quo
TO liquidation, and yesterday and to-day
at least this liquidation represented in
great part the transfer from the London
market to this side of accounts open for
the rise
Such transfer was obviously necessi-
tated by the advance yesterday in the
Bank Of England's discount rate to
per cent and by the fact that in the
middle Of next week occurs the London
fortniehtly financial settlement. A s per
cent minimum discount rate at the Bank
Of England means, probably, that the
charges for carrying American stocks in
London during the coming two weeks
viii be- at "a somewhat higher figure
As 1t costs much less than this 90
carry our own stocks locally. bringing
over Of American stocks from London TO
this market naturally follows.
The great question thus affecting the
future Of the market here, is the probable
volume of selling which viii take place
on our stock exchange for London ac-
count, and as according to the most
trustworthy estimates fully 100000 shares
of stocks have thus been sold by London
yesterday and to-day. the opinion Of
information is that the bulk of tins
liquidation had been completed.
The reasons which have led TO these de-
velopments are now so wholly matters of
common knowledge that IL is almost un-
necessary to refer TO thsm. The Bank Of
England has found the demands ad-
dressed to II for funds greater than its
managers calculated upon. a = per cent
rate by the Bank of England ordered
week ago did not serve 10 check the
drain OF money from the English capital
and 50 the force Of per cent rate. one
that is usually considered as being al
most prohibitive Of speculative buying of
securities in London, has had 10 be
brought into play
There has been much just criticism Of
the inaputude displayed by the directors
OF the Bank Of England in the manage
ment of financial affairs this fan. They
entirely overesumated the strength OF
the position Of their Institution. and now.
apparently. are rushing IN a more or less
frantic maner 10 repair their mistake. II
Is to bee borne in mind. however, that
financial necessities have arisen which
could not be included in any ones fore
sight few months ago.
owing 10 the violent rise in the price
Of cotton. money has had TO be sent 10
Egypt ia far greater amount than is usual
az this time Of the year. and the definite
cause of the sensational rise in the
Bank of England's discount rate on Fri
day was due 90 the knowledge. that came
very suddenly. that more than EIGo 900
would be withdrawn from the bank on the
succeeding day for shipment 10 Egyptian
commercial centers Canadian institu-
lions turned I'D too. with calls on Eng
land for money. that We're entirely unex-
pecjed and it seems Brazil and Argen-
tina are also clamoring in London for
funds.
All the foreign markets to-day were de
pressed. and our stocks III London at the
opening of business here were I or .
points below their final quotations here
yesterday.
The declining movement in this market
proceeded uHinterruDtedly until the close
of business. and was helped materially by
poor bank statement. which, however.
did not take any one by surprise. Bank
loans, owing TO The shifting of credits
from England to this country. increased
Sl6,1 1900 The reported loss in cash by
y
terday's forecasts had made out. but this.
and the decrease I'm loans. diminished the
surplus reserve by $3.50 01a. bringing the
total surplus down 90 $4,000 The bank
surplus Is now less than IL was at this
time last year and the year before. but
is still above the customary figure at this
season.
The decline in the price Of the principal
stocks to-day ran to ~ points. and there
were Individual losses, as 3Iz points in
Baltimore and Ohio; "a in St Paul. s in
Great Northern preferred 80 in Northern
Pacific ga in Union Pacific. and 105k and
3 in Anaconda and Amalgamated Copper.
Since last Tuesday the fall in the stocks
actively the subject of speculation has
reached 81 points An over-sold condition
of the market therefore. if this tendency
Is continued very much further is almost
certain TO result
While the potent factor Of the movement
in the market is, as has been stated, sell
ing for London account. two other mat
ters Of no less importance are those re-
lating TO the ability Of purchasers here
TO take the stocks thus sold and TO scores
that may be still applied to. 1t would be
very strange indeed if a 6 per cent rate
of the Bank Of England does not induce
Paris bankers TO lend heavily in London.
IT has been said. and truly. that French
financial institutions are very DESTROYS of
keeping themselves strong just now, be
cause of their large holdings of Russian
securities but financial exigeHcies in Rus
STA are certainly not pressing, and the
French money lenders are, like all others.
anxious TO put out their money on the
best available terms. II was stated to-
day in high banking quarters here that
negotiations for the transfer of money
from Paris to London We're already under
way, and might reach successful eonclu-
sion early next week.
AS regards conditions in our own coun-
try, it is the universal testimony of both
cur bankers and the holders of stock com
mission houses that We are abundantlv
able at the present time to take over any
portion of the financial burden that Lon
don has found too oner0us. Speculation
by the public has been practically dead in
Wall Street in the last three months.
stocks are located in strong hands, and
the interior Of the country is rich in
money, which it will place at Wall
streets disposal whenever a bid is made
for IL. Aside from all these lie the great
measures of financial assistance right at
the hand of the Secretary OF the Treas
ury. The Secretary could, on Monday. if
he wished, without straining the resources
OF the Treasury in the slightest degree.
place $30,0o00o0, now lying idle in the
Treasury available for four times that
sum ia credits at The command Of the
country's financial institutions. Consid /
GRAFTON of ali these circumstances sug-
gests that 1t is time for the prudent
Spectator or investor TO think OF buying