Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-10-21
Break in Stocks All Along the
Line.
SUPPORT WAS INADEQUATE
Grave Apprehension Over Settling Day
in London.
AMERICAN CREDITS ABROAD
Drastic Action of the Bank OF Eng
land Upset All Calculations in
the New York Market.
AMERICAN CREDITS ABROA

by the heavy inroad the surplus re-
serves of the New York banks revealed
by the bank statement The conditions as
the mark.t closed were panicky, and STOCKS
were being thrown over indiscriminately
and at swift concessions in prices. Some
of the principal declines will sufficiently
picture the conditions. Great Northern
preferred broke $. Anaconda 1o1a, Reading
6la. ST. Paul and Canadian Pacific IA
Union Pacific. Atlantic Coast Line and
American Smelling 4, Northern Pacific and
Colorado Fuel 31zs. Baltimore and Ohio ga
and Louisville and Nashville and Anal
garlated Copper 3, and in the list gener-
ally wide declines throughout ranging up
to 21s points.
There was evidence from time to time
of vigorous efforts to support the market
by TAX nS ever the offer ngs. But the Hood
of liquidation broke through all efforts to
support the market, and threw 1t into the
demoraliZed condition in which 1t closed
London was heavy seller in this market
and grave apprehension was reported IN
London for the consequences in the coming
stock market settlement there. The violent
liquidation of speculative accounts was
demonstration that plans had miscarried
through the change in the money situa-
ton.
The attitude of the Bank of England
, makes it clear that no further gold VII
be relnquished to foreign markets. and
tire pecessity is recognized of attracting
funds to London sufficient to repair the
reserves of the bank Severe measures
for the cutting down of American credits
in that market axe looked for
Bank Statement Showing.
The position in the stock market is gen
orally understood to be maintained to an
important extent by credits thus held.
The currency movement to the interior. es-
peclally TO the cotton region, has been re-
sumed in full force, and the New York
exchange has fallen back to 10 cents dis
count at Chicago. The bank statement
did not reflect all of the expected drain
on this account and on account of the
Canadian Withdrawals. But the SIG 100 100
loan expansion is clear notice of the pres
for credits which the London de
Velopments have thrown back upon this
market, Reports We're current today of
some large time loans being negotiated
here, and rates in that department are
per cent, strongly bid for all dates, with
an expectation of higher rates next week.
Relief by stock market Liquidation was
thus plainly indicated. It's violence and
precipitancy.- however. Were unexpected and
left sentiment disturbed and anxious Total
sales OF bonds. par value 81 Al 600,
The stock market was in a lethargic con-
ditOn all through the week. until it was
thrown into disorder by the unexpected
advance on Friday in the Bank of England
discount rate from > per cent to q per
cent. Following the rise in the bank rate
on October IL from 4 per cent to per
cent, this action was symptom of momen-
tary disturbance that not to be ig-
nOrcd The instantaneous effect was
worldwide. 1t is obvious that the extra
ordinary requirements in the United States
and the resulting drain for this cOuntrys
account on the London money market lie
AT the bottom of the condition into which
the English money market has fallen. But
this prime cause has been complicated by
other intervening factors, especially the
large withdra waIs of gold from the Bank
of England for Egypt. The latter drain
Is reported to be due to the active Specu-
lation in cotton, which again is primarily
due to the decline in condition of our own
cotton crop. These factors are Computable
and are considered capable of orderly adj
justment. But there has been less clear
ness about the factor of conditions in Rus
STA and growing anxiety has been caused
by the occasional reports of increasing dis
order in the Russian finances
Prediction Lethargy.
The apathy of the new York stock mar
ket during the week has been attributed
more I'm the common estimation to the
approach of the elections The public has
been out of the market, and it is obvious
also that market operations by the pow
erful combinations have been discontinued.
The smaller class of traders have had the
market to themselves. The restricted ope-
rations of this class served. however, to
test the conditions in the market. They
demonstrated that the market was under
intentional restraint apparently intended to
hold 1t in a condition of quiescence.
Traders attempts to advance prices met
with obstacles in the shape Of large offer
ings of stocks. On the other hand such
offerings were withdrawn when prices re-
ended and when traders tried to extend
the decline by short sales they Iound their
offerings absorbed with determination.
Movement Of Copper.
The action OF Amagamated Copper was a
conspicuous example OF this tendency. Con-
fidence was general in the advance In the
dividend rate to 8 per cent. but all specu-
iative movements in the stock to advance
the price met with opposition in the form
OF sales of the stock in sufficient volume to
check the advance. The same course was
pursued on the aggressive advance in the
stock when the directors advanced the
dividend. 1t the general supposition
that the purpose of this course was to keep
the market quiet until after election, owing
to the object lessons which were being made
OF the movement of the stock market in
the conduct of the political campaign. For
the same reason various financial projects
which have been the subject of rumors
have been dropped out OF discussion and
speculative sentiment was discouraged by
the prospect that the Indictment TO specula-
ton furnished by these rumors would be
lacking
Real Cause Revealed.
WIN lUt pIOBItSS OF the week the Delle1
grew that developments in the money mar
ket were having much to do with the re-
straint on the stock market as the polti-
cal season Last weeks downward course
of interest rates was first checked and then
reversed. The midmonthly period called
for some large dividend and interest dis
bursements. Banking troubles in Toronto
induced the withdrawal of about 100000
from New York to fortfy the banks there
There was a resumption in force of the
interior demand for currency in connection
with the needs OF the harvest At the same
time the stream of replenishment of re-
serves. which had been coming into New
York bank reserves by the importation of
gold and by the deposit of S26, 900 of
government funds with the banks, was end
ed. Sterling exchange had recovered with
the cessation OF selling of bankers bills
against the placing of finance bills In for
elgn money markets and with the demand
for remittance to liquidate such bills that
Were maturing.
Final Outcome Doubtful.
With the rise in money rates again here
there was downward plunge In foreign
exchange rates which wiped out its recov-
cry and brought the rate back on Thursday