New-York tribune., 1906-09-17
THE FINANCIAL MARKETS.
BIG INTERESTS CONTINUE IN CONTROL OF STOCK
SPECULATION.
Improve Oang to Gold ImpOrtsUaH
ers Confident That Higher Prices WM DeueIop
The WEEK IN WALL STREET.


was no change I'm speculative temperament. The
leading market interests made no attempts to
conceal their bullish attitude. and. following
their lead. the smaller operators admitted
firm conviction that the ultimate trend OF values
would be toward better quotations. and that the
few bearishly inclined traders would hnd them
selves bankrupts il they put into practice their
theories regarding the course Of values. The
larger speculative interests a'e neavy holders
Of securities They apparently are not yet
ready TO distribute their holdings, but they are
exerting every effort 10 attract large public
following. basing their appeal for support on
the generally sound condition Of the countrys
business and on the prospects of further melons
10 stockholders in the shape of increased ana
extra dividend payments. The fact that prices
in the majority of instances already more than
measure present and prospective dividend re-
turns is quietly passed over. while the extent
TO which speculation in securities. I'm real estate
and in commodities has been carried in the last
six months 10 say nothing nf the low position
OF bank reserves throughout the country. finds
no place i'm the arguments respecting the future
Of the market. And the fact that time money
is quoted al per cent, with commission in
many cases while investments are yielding
about hale OF this per cent on the average also
does not figure in the current campaign for
higher prices.
Ordinary reasons for lower quotations carry
little weight in this market for the good reason
that speculation is controlled by combination
Of powerful banking and speculative interests
whose resources extend from the gold fields Of
South Africa 10 the largest and smallest banks
I'm this country. These resources are fostering
the greatest speculation in the history Of the
New Yorl. Stock Exchange. the end of which
VIII be no different from that OF the speculations
in the past. unless the public should decide to
let the big men keep the wares which they are so
anxious 10 distribute at fancy figures But of
this there is little chance. High prices appeal to
public operators and at the top people who have
enough money to buy five and ten share lots
will be speculating I'm one hundred shares and
more. IN the confident belief that the golden
harvest is To run indefinitely The long con-
tinued activity in all branches Of the country's
industries SHOWS sign of an unfavorable
change. This. of course. is a source of great
comfort 20 holders of American investment Sc
curitieF, and naturally il discourages pessinism
I'm business circles. but this very prosperity has
developed elements of weakness which ought not
10 be brushed aside unimportant for in this
weakness there is grave danger of future trouble,
not only i'm securities. but in the conditions af-
fecting the commercial growth Of the country.
Industrial progress may be arrested by over
epSCuldNlolls DA LOO llluCn sllLluldllou III lIdQS
and by public and private extravaganza. such as
being witnessed to-day: and at the present
time there is reason why the observer OF the
course OF affairs throughout the land should
sound warning against the excessive specula-
tion being conducted, especially in real
estate and securities. The recent Philadelphia
failure has been followed by disclosures which
give inkling of a certain phase OF current
speculation in real estate. and while there is no
reason 10 assert that such conditions are gen
eral, II IS common knowledge that real estate
operations throughout the country are being
Quoted on borrowed money at a rate which must
inevitably end I'm disaster. unless moderation i'm
mediately takes the place Of inflated bull en-
thusiasm.
The monetary situation In New York has been
improved through gold engagements abroad fol-
lowing the agreement OF the Secretary Of the
Treasury 10 deposit government funds with
banks pending the arrival from abroad OF an
equivalent amount OF gold. In the last week
upward Of S20Oo0eO OF bonds 20 secure gov
erRment deposits We're placed with the Sub
Treasury i'm this city. and in consequence the
Clearing House banks were able to restore their
reserves above the legal limit. despite further
shipments of funds TO the South and West The
large engagements OF gold in London were re-
sponsible for an advance in the Bank of Eng
lands minimum rate Of discount; also IN the
open market rates in London, Paris and Berlin,
while the movement also reflected I'm an ad-
vance I'm sterling exchange at New York.
Though it was reported that the Bank Of France
would open its doors To American importers
such action was denied by responsible authOri-
ties, and under present conditions IL is not likely
that the United States will be able 10 draw much
gold from Paris further large
amounts I'm the British capital Local bankers
rI..1.- hat sn,r
pick up the metal in other parts OF the world
indication OF which was presented az the
close OF the week when IL became known that
one large institution had taken some of the
metal in South America and was in negotia-
ton for a large consignment in South Africa for
shipment direct to the United States. There is Il
great scramble for gold. and the fact that il 10
be used 10 strengthen. the hands OF stock market
and real estate spectators naturally adds a rich
flavor 10 the speculative pie which is now being
cooked for Wall Streets elect The little fellows.
unless they own stocks outright. will not even
get piece of the undercrust but they are happy
IN the silly belief that they will share in the
feast.
In the last week there was an increase in cash
holdings OF the associated banks of 81. So, 200,
while. as against a deficit il the reserve in the
preceding week, A reserve above legal require
ments OF S3.5364O1 was reported. This is not
an exhibit that encourages conservative people
20 operate in stocks at the present level Of
| prices but il IS a matter Of little moment with
the powers now in control Of the market. Cuban
developments have not been factors affecting
Wall Street, though they have served 10 disturb
! 10 some extent the sugar trade. The Hearst
I movement has hot entered the calculations Of
the speculative element. the loss in the Repub-
/ liesn vote In the recent Maine elections has not
] haasa fuar