New-York tribune., 1906-12-08
BROKERS' CHARGE PLOT.
BIG BANKERS ACCUSED
Fluctuations in Call Money Rates
A1caben Protest.

The fluctuations of call money rates at the
New York Stock Exchange yesterday led some
Of the brokers to make the charge that certain
banks and trust companies of the city were in
a conspiracy to keep the rates higher than the
money market warranted. Call money advanced
at one time yesterday to SO per cent and then
suddenly dropped to > per cent, At the close of
business at the Stock Exchange some call loans
were made with the interest charge even as low
as l per cent
Jacob H Schiffs statement at the Chamber
or Commerce meeting Thursday .ha, snl=
of the financial institutions forced up the rate
of interest on call loans by calling IN the loans
when the rate was low and waiting for rise
before making new loans continued to he the
subject of exciting talk in the financial district
yesterday. IN line with Mr.. Schif's statement
was the charge. made openly on the floor # the
exchange that yesterdays high rates were due
70 manipulation Of the money market by certain
financial institutions.
Many renewals OF call leans We're made ~
the exchange yesterday at 30 per cent. These
loans ran into hundreds Of millions Excite
mont was created among the brokers over the
high rate. and some Of them declared they
would refuse TO pay such a rate Of interest.
There seemed To. ne plenty OF money for call
loans and the brokers who refused to pay -
per cent obtained loans at much lower rate.
Among these brokers was Charles f. Quincy.
Of No. so Broadway. He paid off a IOan which
he had obtained from prominent bank and
had renewed on Thursday AZ - Gail money
dropped after that. and he made arranrs suents
TO get a new loan from the same bank at
per cent. Then he received word from the bank
that il would have 10 have another firms in
dorsement before making the loan 10 his firm.
Mr. Quincy got his loan from another bank
banks had fixed an arbitrary rate Of 80 per
cent but that brokers need not pay such a rate,
and that there was plenty Of money to be OBJ
tained al q much lower rate. He said he would
demand an apology from the bank which had
refused TO make the loan at per cent. Said an
official Of the bank later:
We know nothing of q conspiracy to keep up
the rates for call money. We make call loans
fer our customers acting as agents az what
we ascertain 10 be the prevailing rate. We never
charge more than per cent on the banks own
money that is let out i'm call loans, but have
many out OF town customers who deposit mill
ions with US, with orders To let the money out
on call loans when the rate is high. We are
obliged TO get for them the highest rate we can.
Mr.. Quinceys loan was renewed Yesterday at
% when that figure below the prevailing
rate We sent OUT notices to-day that we would
make renewals at 80. and at that time the con-
Mr.. Quincy objected and paid off the loan We
had no doubt about the financial ability Of his
him n loan at after he had refused 10 re-
at what deemed by others fair rate.
The prevailing rate for time money for sixty
or ninety days was s per cent yesterday. bur
some complications in the time money market
were created by the fluctuations in call money
There was we'll defined report in Wall street
that tho Secretary of the Treasury would come
20 the relief OF the money market by Monday
next. The president of one Of the prominent
banks of the city said
I think Secretary Shaw would be entirely JUS
titled in coming 20 the relief of the money mar
ket at this time The mercantile demand for
money Is very heavy. This is prosperity de-
mand due to active business and high prices
Merchants unable Ia sell their paper under
existing conditions To any very large extent and
are therefore. coming back upon the banks in
which they keep their deposits for aCCommoda-
tion and this is adding to the burdens which
the banks nave TO carry Discounts are very
much heavier than at this time year ago.
The movements Of currency. as reported in
Wall street Yesterday, indicated loss of more
than SSOOOOoO in cash held by the banks Of the
oitv this week. This loss. It said was due
10 large shipments of currency to banks in the
;rterfor of the country and to Sub-Treasury
1r,era tiOns As q natural consequence, there was
- IirtIe extra currency strtngency in the city
ard therefore, more reason for raising the rates
for call loans
e,acL exchange yesterday Of organizing a stock
,ie.riDp house through which all loans To mem
-. .cuId he made There also talk of
establishing a system of foTtnightiy settlements
- stnck balances instead Of daily balances
y. 49, man II was said might help do away
80 ~ Objectionable fluctuations in the inter
ct charges on call loans
uENRI coNFisEUR, al -es w. 44TE.
,,t-,.a.l-,-ss Partisan Tea Room F,arissa-