Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-01-07
Saturday Proved a Record
Half Day for Business.
HALF MILLION IN SHARES
Embraced in the Transactions for
Two Hours.
LARGE SCALE PROFIT TAKING
Bank Statement Somewhat Disap-
pointing-Cal Rates Accepted
as Index of Conditions.

be one of the two or three most active odt-
urday haIf-day's business in the history of
the stock exchange, transactions In the
two hours rising well over million shares.
The strength OF the market was striking
and comprehensive, notwithstanding some
slight frregularity and occasional reactions.
Profit taking. in fact. was large scale.
but the readiness with which 1t was alb
sorbed was striking. The fact that yester-
days trading failed to show the late reac-
ton. which had occurred on each former
day of the week. served to convince specula
tive opinion that the weeks testing opera
lions have proved the strength OF the mar
ket with the definite relapse in the rates
for money on call.
The bank statement proved something of
a disappointment, but yesterdays low rates
for call loans were accepted as a true index
of money conditions, and speculative OPP
erations on the long side We're conducted
with great holiness and on large scale.
st. Paul and the Southwestern Pacifics
were central features of the market. and
gossip very busy with forecasts of the
amount of the forthcoming Union Pacific
dividend. Several Industrial specialties
which have not moved hitherto, also rose
suddenly and violently.
The copper stocks and the coalers were
forced back after showing early strength
by the weight of realizing sales
Enormous Absorption of Steel.
There was an enormous absorption of
L. 5. Steel which advanced it to the highest
record on the present movement. There
was no surprise that the heavy local
movements of cash had confused the pre-
liminary estimates of that item In the
bank statement, the loss In cash running
to S219S,TOO in place of the expected in
crease Of about that amount Joined to the
increase IN the reserve requirement the re-
SUIT was a shrinkage in the surplus to but
little over half million dollars
The sterling exchange market also al
though nominal on Saturday. was distinctly
strong, and the continental exchanges
moved against London again. There was
heavy wtthdra wal of gold from the Bank
OF England for shipment to South America,
Ihese developments added to the interest
with which bankers are watching money
Developments on the side of the foreign
exchange market. The stock market how
ever. showed a late revival of strength. and
closed extremely active. but still Irregular
Total sales of bonds. par value, $1,S45, 900.
The Weeks Speculation.
The weeks speculation has shown EVIL
dence Of a struggle with the difficulties of
the money situation. The stringency made
progress toward relaxation, as was taken
for granted would be the case but the
progress was slow and the immediate re-
quirements so stiff as to discourage many
holders who had refrained from iiuuldatfon
even with the 125 per cent rate of last
weeks money market.
rate for call loans on Tuesday OF 60
per cent. on Wednesday of Oper cent and
a maximum rate even on Thursday Of %
per cent fell so far short of the prompt re-
lief expected that stocks came freely upon
the market from time to time and caused
some considerable inroads upon prices
The backing and filling of the market I'M
Ger the influence OF the uneasy feeling gave
way 10 sharp drop on Thursday after
fF4n ~ H. to-
OF Jacob II. Schff pointing out the nos
slble dangers Of present financial conditions
IN words that were given a sensational sig
nIhcance.
Jipn naturally gave rise TO a great deal of
discussion of It's probable causes The
weight of the criticism up TO the time of
Mr. SchIn's utterance bore upon the bank
ing policy.
Buying of Deposits.
The buying of deposits, especially Of in
teriOr banks, by the offer Of interest rates
on deposits during the season when funds
were in small request through the country
at large was held largely responsible for
the piling up Of excessive reserves in New
York banks and trust companies
The urgent pressure to employ these funds
was the cause for their placement in securf-
Ties and speculation from which they could
i'ol Ieduliy be withdrawn when the de-
I.ahds Tor circulation began to drain the
reserves OF New York by the withdrawal
or deposits by interior institutions
Inc growth of trust compa MES the mag
nitude OF their banking operations and their
freedom to place their reserves on deposit
with the New York banks where they fig
ured again in the item of reserves Of tie
banks themselves, We're pointed to as great
~ expanding the credit operations of the
banking system without any corresponding
increase In the available reserves
Tho praSc,,ra g.,
The extraordinary pressure for credits
which has resulted is recognized to be due
primarily to the unprecedented trade activ-
ity and prosperity OF the country. But
these conditions have been so clearly fore
seen for months past and have been so
constantly heralded by warnings against
excess in the extension of credits that the
banks are criticised for not putting re-
straint upon the borrowing and providing
better for the inevitable excuses of the
autumn money markets.
The money market condition of the last
sixty days IS pronounced In the emphatic
terms of Mr.. Schiff nothing less than a
disgrace TO any civilized country" This
Influential financier's decisive fixing of the
blame for the situation upon the ineIastic
currency system of the country, however,
has given new course to the market of
criticism. The abstention OF the United
states treasury authorities from measures
OF larger relief for the money market have
been a grievance in the prevailing discom-
fort of the situation.
Heavy Interest Charges.
OF more personal quality was tie in
huence of the dissatisfaction felt and loudly
expressed by the customers of the great
stock exchange commission houses upon
receiving statements this week of interest
charges FOR December on sums borrowed
for carrying stocks on margin Average
rates for the month ranging from s per
cent 10 20 per cent made formidable Off
Set TO speculative profits on any ordinary
advance IN prices of stocks
Aggrieved customers point out that the
usual charge to them OF per cent in sea-
sons when the commission houses are Dor
rowing for per cent on call or less en-
titles them to an averaging down of the
rate Even commission houses have TO
pay 100 TO lbs per cent for day or two.
Commission houses retort that the stock
exchange regulations are strict against any
allowance of interest TO customers that
would operate 10 reduce the prescribed rate
OF commission on transactions on the ex-
change.
Disgruntlsd Operators Liquidated.
Discomfort on this subject has caused no