The Birmingham age-herald., 1906-04-15

 engagement went into force on Thursday was a total surprise to the financial com munity in general.
 It was matter of comment also that tile cash reserve item in the bank state ment as published failed to reflect the ap pearance in the reserve of the cash de- posits by the government as above indi- cated.
 The increase in cash shown by the state ment amount to $1, 93s, 200, which does not more than cover the gain on the known movements of currency for the week without counting the increase, in the gov ernment deposits against gold engage ments. The heavy loan contraction of S23, ,454 200 effected so considerable of reduction in the deposit liabilities as to cut down the reserve requirement to the extend of S5,394, ,925. Joined to the cash in crease, this was sufficient to wipe out last weeks deficit and to establish a surplus of $4 772,O0O. The breaking of the stringency in the money market is thus abundantly explained. The resulting rise in the stock market continued up to the closing which was strong and active.
 Total sales of bonds. par value, 1,0400 900.
 The stringency in the money market has brought some alleviation this week by the force of it's own tension. This has been principally by engagements of gold in London for import to New York. The pressure on the foreign exchange market became so severe by reason of the money stringency here as to force the sterling exchange rate down to figure where command was obtained of the Bank of Englands holdings of British gold coins. As is usual under these circumstances, tho bank preferred to surrender American coin and bars, but the price exacted was the highest limit to which the market lf-w.A h arawal of British coin. The demand for exchange in New York to cover re- mittances against gold engagements caused a violent rebound in the exchange rate which carried it decidedly away from the gold import point. The effect upon the money rate in New York underwent similar variations. Money rates fell away to nominal figures under the first effect of the gold engagements and recovered to a 10 per cent level with the recovery in foreign exchange.
 There were other influences at work toward relaxing the money stringency, and the commission on time loans which was demanded early in the week disap- peared. At one time borrowers for thirty days paid the equivalent of per cent for sixty days 8 per cent, and for ninety days per cent. The week opened with money on call from 20 per cent to 5 per cent. The persistence of the stringency induced some speculative liquidation or stocks. and the money market got rehef in that way.
 The monthly pension payments reduced the sub-treasury absorption from the money market. although the payments of customs continued large. It was repre- scented that the secretary of the treasury was pursuing the policy of deposit in the national banks of the country of the cur rent excess of government receipts over expenditures, and this had the effect of relieving the New York banks Of some part of the demands upon them for cur rencv from the interior.
 The effect of these factors of relief on the money market was so gradual that + is believed they were based on the expected and prompt relaxation of the money market following the 1st of April. The disbursement of dividend and interest money. the fixing of the call for report of condition of the national banks and tho beginning of gold imports were suc-. cessively looked to for the hoped for re- lease of banking resources for specula- tive employment fin the stock market, and the effect in each case was disap- pointment.
 The consequence has been to restrict the speeufatiye operations in stocks. but the market has been remarkably free from pressure of liquidation at any time, and prices have yielded only slowly and stub bornly and with tone of resiliency in the intervals when pressure was relaxed. The Wednesday recovery was sufficient to wipe out the price losses of the two preceding days and bring prices back to the closing level of the preceding Satur- day.
 Confidence in the soundness of general conditions and in the promise of con- tinted prosperous conditions seemed un- impaired. The government crop on Tues day estimated a condition of the winter wheat crop of April not fully up to the speculative anticipation. But the condi- tion estimate considered on the basis of acreage of the crop offered an indicated crop as large, with the exception of 1901, as any winter wheat crop in the coun- try's history. and the secondary effect of the report was helpful to stocks.
 Iron trade statistics showed a record output for March. and with an increase in furnace capacity on April l compared with Marcll,1 1, while stocks on hand con- tInue to diminish. Purchases of iron for future consumption are increasing, al- though with some price concessions. Pur- chases of steel rails and other lines of finished products are on an enormous scale Railroad earnings continue to make extraordinary comparisons with previous periods. although some effect on traffic is conceded from the interrup- ton of coal output and from the restric- ton on some lines of industrial output caused by it. The conferences over the attempted anthracite settlement have been followed with attention and with some decrease of the hopeful sentiment for settlement but the influence on speculative sentiment towards the mar ket has been unimportant.
 There is a growing realization of the