Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-02-04
Cherry s IloranCo
The Mans Store, 8ll Pa. Ave.
Financial News Letter
BY w. G. NICHOLAS.

| NEW YORK. February j. 1906.
! After Wabbling for several days the stock
market took plunge like diver going off
! the end of springboard 1t went head
! first, and Reading was the head The mar
| ket was all the better for the shaking up
| 1t got. Numberless pyramids toppIed over
and large aggregate OF Ight-waisted
| money disappeared in the shuttle. Likewise
| some big chunks of heavy-w weight money
| shifted ownership. Ii was period of ex-
| element and quick action. The general
market decline was three to five points.
with more severe breaks in individual
stocks, like Reading Union Pacific, Colo
| rado Fuel and Iron, Amagamated Copper
| and few others The situation had been
growing dangerous for some time before
the reaction set in. The short interest had
almost been eliminated and attention was
being called unpleasantly to the over
bought condition of the market The
facts were so plainly evident that really
very little excuse was needed to start prices
on The down track. Quite a number OF i'm
portant operators have unloaded their big
lines of securities, and the floating supply
of stocks had not yet found secure relodg-
mCnt. 1t was licked up later on after prices
had broken ard the market had passed
through its reactonary stage. The position
of stocks is now decidedly stronger and
healthier than it has been since the break
two months ago, and conservative bulls
look hopefully forward to a long-continued
Improvement In values, accompanied by
lively speculation.
The 'kuow-alls' of Wall street insist that
George Kessler, the wine merchant, has
been trimmed" during the last fortnight
for more than S2;CN0,OCO, although the
story of that gcnueman's big loss meets
with strenuous denial by the one man who
ought to know. The incident is generally
regarded as something of joke Accord
Ing to the popular version, Mr.. Kessler's
operations in the stock market had be-
come large and regardless of other
peoples market interests that it was found
necessary to subject him to a course of
discipline in order to teach him a lesson
and cure him of habit of putting in"
1t was his venture in Reading that proved
his undOing He had picked out that stock
as a good thing and bought it on such a
large scale as to literally take the market
away from its natural leaders and guar
dams. He didn't even say by your leave,
kind srs." but just jumped in and bought
and kept on buying until he had 1CO,-
eco shares. His purchases put the price
up about $f5 share to a record figure. II
was at this point that the big insiders
| in Reading began to get angry. They
called one of the great market leaders
into conference and some important bank
ing interests identified with the ownership
| of the property let him know that he could
have all the stock he wanted for delivery
on short sales. Immediately there came
a deluge of Reading which was kept up for
| three or four days. kessler and his fol-
lowing tried in vain to stem the tide.
| Presently they let go of long stock and
| there was a rout Reading broke 30
| points and on the slump there was a
| wholesale covering of shorts vast sums
| being transferred from the pockets of the
| defeated Kessier contingent to those of
/ Mr. keene and the bankers behind him.
| Whatever Kessler may have lost in his
| Reading campaign he can pay without feel
| ing 1t, for he has been one of the great
| winners In the stock market during the
| last year and a half. being credited with
! having taken more than 100000 out of
the street in that time. He is believed TO
| Lackawanna alone. besides having made
| wonderful killings in Union Pacific, Smell
ters and other active stocks.
| *
John w. Gates contributed materially
| to the gaiety of nations. He was among
! the first 10 get on to the play in Reading,
| and the way he slaughtered the market
was caution. He sought out every vul-
nerable spot and bored in with vigor. He
| used all the known market articles to
make his campaign as spectacular as pos
slble and no doubt played an important
| part in the break. If a shake-out was his
| purpose In order that ne might buy back
| a big line of stocks on the break then his
| campaign must be called a success 1t is
| rare thing for Gates to be openly bear
ish and 1t is impossible for him to remain
| on that side Of the market for any length
of time He is temperamentally a bull
and has made most Of his coups buying
STOCKS for a rise. At the same time he
mas been manufacturer of securities on
large scale and has cleaned up many
millions in that branch OF his Wall street
business. His latest performance In that
line to increase the Capitalization of
tennessee Coal and Iron, after running the
| the cloud line