The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1906-05-06

declines was generally overcome when
Reading began to shoot upwards. An ir-
regular tone asserted itself again after
the appearance of the bank statement.
Operators in stocks have keen apprecia-
ton of the enormous extent to which
credits in the stock market have been
scaled down during the week. That the
average of the loans of the banks should
have been increased for the week $780,
400 made a striking exhibit of the heavy
requirements which make the withdrawal
of credits from the stock market neces-
sary TO afford means for meeting them.
A decline in the cash holdings of $500, 200
was In contrast with. preliminary esti-
mates of a gain from $o'O00O0O 10 over
$40 600, COO Withdrawals of cash by the
trust companies to build up their re-
serves in compliance with the new state
law were given the responsibility for part
of the discrepancy. There was similar
discrepancy In last weeks bank state
ment which would bring the averages
over into this week, the loss in the cash
last week being less than a million dol
lars. when the known movements or
money had indicated a loss of nearly w.
100000 Furthermore, some of the large
gold engagements of the latter part or
the week owing to delayed accounting IN
the sub-treasury operations nave not
figured in this weeks bank statement.
The erect OF the SldltllltiA VI tiit PNoNfN
market nevertheless. was unfavorable.
and the closing was irregular In spite OF
the renewed advance at the last moment
in the coalers. Total sales of bonds, par
value. $1.225,000.
There has been drastic liquidation or
stock during the, week. and great dam
age resulted to quoted values, ana an
enormous shrinkage of the basis OF
credits. The movement was accompanied
t1x- Low and confusion owing
to the urgency of the pressure to sell.
The larger part of the liquidation was
attributed to over extended individual
speculators and to market pools and or
CARNATIONS The long immunity or these
important elements in the speculative sit
uation from the ordinary exigencies of the
money market during the stringency or
December and March. seems TO nave
been due to the ample resources with
which they provided themselves in time
loans running beyond the period of nor
mai strain in the money supplies. 1t is
sunposed many of the time loans so Sc
cured have been maturing recently, and
the borrowers were left in Vulnerable
position by the unwillngness OF leaders
TO renew, owing to the heavy require
ments thrown upon the money market
especially by the San Francisco An
other factor was the unstable conditions
manifest in the stock market in securi-
ties which figured in the collateral for
loans. The requirements of the May l
settlements complicated the situation and
the speculative pools had no other re-
source but to liqudate their stock hold
,nes On wednesday the sales of stocks
rose to nearly two and one-half million
shares. and the crash of prices was so
violent as to cause alarm. AS is not
unusual. however, In speculative
crisis, the paroxysm proved the culmi-
nation for the time being, and the sub
seauent trading showed the rehef al
forded by the operation.
while some complcating factors have
entered into the weeks speculative OPP
erations the dominating influence has
heen the money situation. The immediate
apprayating cause Is recognized to be
| tho San Francisco losses. But the small
effect in alienation produced by the
prompt and heavy flow of gold TO New
York points to pre-existing causes TOT
tho present strain on capital resources.
THE first pressure resulting came natu-
rally upon the securities market ana so
far as speculative initiation in stocks was
at fault a long step has been taken to-
uard correcting It. 1t is the general
conviction in the financial district, how
over that the huge credit expension in
other fields. or in all fields, lies back of
the movement toward replenishment of
banking reserves In preparation for the
continuing requirements which are seen
ahead for the carrying on of enterprises
already embarked upon, and dependent
eor success upon supply of funds to
eomnlete them. Great bonds moved in
sympathy with stocks, but within much
narrower price range.
United states IS declined Il per cent on