Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-12-16
A MORE CHEERFUL VIEW
Hill Stocks and Union Pacific Are
Strong Features in Trading.
A WEEK OF FEVERISHNESS
Money Situation Responsible for Re-
straint on Speculation-Money
Rates Again Look Upward.

NEW YORK, December 15.-The stock
market today maintained the more cheerful
view of the speculative outlook reflected in
yesterdays sharp rebound from the depres-
sion of the earlier part of the week The
days market did not show great strength
except in spots, but there was no important
concession of the large recoveries of yester-
day. The bank statement was better than
anticipated. although the Improvement
failed to wipe out the deficit in the legal
reserves. The shortage was reGuced how
ever to the extent of over So 600 600. leav-
ing 81. 699. $50 still to be made up.
The showing of gain In cash instead of
the estimated loss of from 81 600 OOO to 49,
100000 was unexplained but was supposed
TO be due to larger showing of govern
ment deposits with the banks under the
treasury's offer than had been counted on.
Further gains are expected from the gov
ernments offer netx week The return of
come of the large dividends payable today
to the channels of the money market is
expected TO have an Influence In the money
market of the coming week. The ST., 900 900
loan reduction effected by the banks con-
tributed materially to the relief of the stu
alton. The announcement of the Issue of
$93O00.O0O of Northern Pacific stock for
subscription to stockholders at par con-
firmed the anticipation.
Hill Stocks Features.
The rights were quoted on the curb at SO
a39, and the Hill stocks were strong fea-
lures in the trading So also was Union
Pacific. st. Paul and Canadian Pacific
showed some eject of profit-taking and
this became fairly general after the ap-
pearancc of the bank statement There
was a vigorous rally before the close and
the market closed strong Total sales of
bonds, par value. S936OO0
The action of the stock market this week
mas been feveriSh under the influence of
factors that were al times conflicting, and
which changed from time to time The
money situation has worked some restraint
on the speculation at all times, and strin-
gent conditions Lecame aggravated as the
week progressed. But the late break in the
market was attributed more largely to
other causes. The acute weakness devel-
oped i'll the Hill railroad stocks mad a bad
effect on speculative sentiment and the
confusion in the various explanations for
the weakness rather added to it's effect.
The course of the Hill stocks in the market
is largely typical of the whole of the re-
cent speculation. and their response to the
different stages of the speculation is ac-
cepted as pointing to- the probabilities in
other cases. 10. sf-.. go ..-.- So .s.-a.
1t Is this condition that makes the move
ment of the stocks of large sympathetic
effect on the whole market. Great North
o
series of profitable develepmnts which have
given rise to a keen speculation in the
shares. The announcement this week of
the rights to subscribe at par to 40 per
cent of holdings of the stock is believed to
end the series of specia1 occurrences which
have been the ground for the speculall ION
in the stock. In the parlance of the stock
exchange all the good news on the stock is
out. Speculative holders of the stock who
had not already realized their profits were
inclined therefore to sell with the exhaus-
ton of possibilities for stimulating further
buying of the stock.
Violent Break in Prices
This selling met so slight a demand
that a violent break in the price result
ed and the conclusion forced that the
speculation had to run to excess, and had
set an undue valuation on the benefits
which have accrued to the stock. This
conclusion was fortified by the rapid de-
cline in Great Northern ore certificates
and in the subscription rights to the new
stock which was dealt in in the outside
market. The decline was precipitate
that fears were aroused of additional oc-
cult causes. The opinion of the attorney
general of Minnesota against the legality
OF the new stock issue served to explain
partly the misgivings with which the
subscriptions were received.
There was anxiety also lest outbreak
of latent antagonisms among the con-
trolling forces in the northwestern rail-
road world might be finding reflection
in these stocks. The action of St Paul
stock contrary to the course of the gen.
eral market fostered the conjecture that
competitive buying might be going on for
these shares between the same financial
powers which sought to adjust their former
quarrel over the control of the Burlington
by the formation of the Northern Securities
Company.
The large holdings of the two Hill stocks
remaining in the Hartman control as re-
suit of the miscarriage of that project
and the retention of which on motives of
railroad policy was made of non-effect by
the dissolution of the Mort nera Securities
Company gave piausibility 20 n supposi lion
that the Hartman holdings might be COM
ing the market The Disappointing re-
Spouse of Great Northern preferred to the
prospect of the large addition to the capital
stock was OF special effect sentiment
owing to- the large part played in the recent
speculation b. hopes of subscription rights
t. new stock issues.
More Stock Issues Coming.
huge volume of proposed new issues of
stock by different railroads is already de-
fined, and there is a common expectation
that more are to follow to take care of the
manifold requirements for capital outlay
OF practically all the railroad systems in
the country. The success of the appeals
for new capital will be dependent on the
sustained value of the stocks which are
to be expanded The giving of rights to
subscribe to new stock below the current
market price is a device designed partly
10 further this end.
The dividend increases, which have been
general, have been criticised in some in
stances for going hand in hand with great
issues OF new capital and borrowing of
money. The purpose to add to the attrac-
tiveness of the new stock issues cannot be
doubted. The extent TO which the proposed
new stock issues will be taken Is an i'm
portant element in the future of the stock
market and sentiment is sensitive to all
signs OF how the market is to receive the