The Cairo bulletin. (Cairo, Ill.) 1???-1928, 1906-08-27
HENRY CLEWS' LETTER.

facts are noticeable in the stock mar
ket First, an extraordinary combina
tion of favorable circumstances and,
second the undoubted purpose of
powerful financial interests to take
every advantage of these circum-
stances possible. Without going into
the already familiar details about
good crops, satisfactory business pros
poets, the great activity in industry
etc, the present situation is probably
the most remarkable in the history Of
Wall street Not in the memory OF
! the Oldest operator has there been a
| time when the financial skies were
so universally bright or so free of
clouds. The plans of our large oper-
ators. therefore, need cause no sur
prise; they are the natural sequence
of the times. While their methods
may have involved them in an out
burst of criticism, their objeets are
the same as those pursued by all other
men in gainful employment. They
have large amounts of stocks to sell,
and the probabilities of of finding a
profitable market are beyond their
NEST hopeful dreams. There is moth
ing unusual therefore, in their pull
! ing together for this purpose. Just
now their principal argument is that
of increased dividends, such talk be-
ing stimulated by the large earnings
of both railroads and industrials
When this line of argument is exhaust
ed. others, such as new deals, etc, will
follows. Success in the present bull
movement depends entirely upon the
extent to which the public joins. Hith
ero the latter has been exceedingly
apathetic partly because very skepti-
cal at the prese tnhigh prices and
partly because they have frequently
found better employment for money
elsewhere.
The intoxicating effect of the Union
and Southern Pacific dividends was
! highly contagious. Such advances and
activity as occurred in these stocks
were simply irresistible, and market
leaders were quick to take the lesson
and apply similar tactics to other
shares. Apparently the big men have
the market under full control. Their
purpose appears to be to give prices
a substantial rise and then allow them
to recede moderately, avoiding any
disturbance of confidence and stimula-
ting buying by various encouraging
Irumors Thus far they have been I'M
expectedly successful very consider.
able amounts of stocks having already
passed from stronger into weaker
hands Whether the public has been
wise or not in entering the market at
the top and taking stocks which old
land experienced holders did not want
is a question now beyond debate. The
public is already in the market, and
the universal feeling in the Street is
that those in control intend to carry
the market still higher in order to
facilitate continued distribution. The
higher the level the greater the dan
ger of reaction, of course; but in the
present extravagant mood Of optimism
such facts are not regarded.
The chief obstacle to the present
vigorous bull market is the monetary
situation Local bank reserves are
very low and in no shape for carrying
| on q big continuous bun campaign at
this level of prices. Some relief may
| be obtained by the release of Govern
ment funds. but Secretary Shaw is not
| likely TO be in any particular hurry 10
invite public criticism by promoting
the speculative movement in New
York. The only genuine assistance
which the New York moey market can
find will be in gold imports. UnforU-
lnately however, none of the great Eu-
ropean financial centers are in a posi-.
ltion to part with any important
amount of the precious metal. In
the middle of August the Bank of Eug-
land held E37.000,000 gold, or only
! 100000 more than year ago; the
! Bank of France held over E1l6,00O.-
0O0. or e2,0O0000 less than year
ago: the Bank of Germany held over
! c54.000,000 in the middle of August.
| or eS 100000 more than last year.
Taking the ten principal European
banks together. the total amount of
gold held by them on the date in ques-
ton was 403.000.000, which was
scarcely equal to their holdings of a
year ago. and this in face Of much in
creased demands from various
sources. There has been some talk
of gold imports from London. Elk
perts calculate that London can spare
about e15,O00.000. but Argentina.
Egypt. India. and other colonies are
linsistent upon their demands at Lon
don. so that at the outside not moro
THAN e3.00O 600 or e4,000,O0O of this
amount is expected to come 10 New
Yark. In case of emergency this sum
might be increased somewhat for the
simple reason that New York is bet
| ter able and more willing to pay the
higher rate than anv other bidder,
and. consequently. more likely to Sc.
cure the gold if VARIED. The best
chance of increasing our gold supply
lis in drawing new production from
Africa. Australia. the Klondike, and
orr own mines. In this manner we