The sun. [volume] (New York [N.Y.]) 1833-1916, 1906-07-08
GossIP 0s- .WALL STREET.

SfOShcu ny tno uu8Ip0CtSu pfouittlun, tbot
the loss In cash would prove 80 heavy a. TO
morethen Offset the effect Of the reduction In
loans and deposits on the surplus reserves. and
that. as q c~onseQuencp. q reduction and not
an increase would be shown In this Item {.
From that time prices began to shade of, and
although they rallied temporarily Just o. the
statement made Ito appearance the figures
were 80 much at variance with the hopsfhl
a~nticlpations entertained during the greater
part Of the week that a sharp reaction ensued.
although after q decline Of . point or 80 In
the active Issues the market again began to
manifest renewed firmness.
The unlocked for loss Of cash was accounted
for by the necessity on the part Of some OF
the trust companies 70 withdraw funds In
compliance with the requirements Of the
State law enacted last winter compelling
these institutions to maintain o reserve.
This law went into effect on February ~
and imposed on trust companies the obllga-
tIon Of maintaining q reserve Of 2 per cent.
from that date, to be increased to 8 per cent.
by january /. 1907. An increase OF 4 per
cent, dated from July ! and while some OF the
companies already held more than their full
legal requirement In reserve there were still
q sufficient number, under the mark to make
the preparations to come up to the new
minimum o factor OF no small Importance
In the money market. Something OF the
oeiAiU hAho ihey ~ VII
the end OF the present year. ,',a. .a-
Those who have advocated the establish
mont Of a great central bank pointed to the
effect Of the locking up Of additional funds
In the way of reserves by the trust companies
as an object lesson sustaining their theories.
They said that while there was an agitation
all over the world for increased reserves
there was such an essential difference between
banking conditions here and abroad that
our methods must be radically reformed
before the locking up Of increased reserves
can be regarded as an unalloyed advantage,
| The difference is that in England, for In.
stance. the reserves Of the banks are placed
ia the Bank Of England instead Of being
locked up In the other metropolitan and the
| provincial banks. so that they continue to be
| OF use by furnishing a basis Of currency.
| Some banks contend that similar results
| could be secured here by making the Clearing
\ House the custodian of the reserves. but as
matters stand those who favor a central
bank say the need for such provision becomes
more apparent. To-
There Is no doubt that the rapid advance
In the market previous to the publication
Of the bank statement was not viewed with
entire satisfaction by substantial banking
interests The view taken In these quarters
was tina the decline a week ago had gone
a long way toward removing some OF the
weak elements in the situation but that a
sharp reversal in action Of the market would
destroy what had been gained and leave
matters In much the same shape as they were
about the middle OF June. H. was commended
that what was wanted was q quiet market
during the period Of convalescence. II
stocks could maintain quiet irmness during
the critical period In the crop season and the
public got an opportunity to come In at some
thing like the present level of prices after
the years outlook had become pretty clear
a widespread participation in an upward
movement In securities might lie secured
in the course Of a few weeks,
THE market" said a member OF a con-
aeryative house. Shows a tendency TO become
dun and therefore I think the time has come
for careful purchases Of good stocks. SO
LON as prices were put up mainly on account
Of the existenc e Of a short Interest ! had
no faith In the market. but now that II begins
TO show ability to take care OF itself ! feel
that the good thin ga promised for next fall
will pay the investor who buys cautiously"
Very wide circulation was given to the
rumors that the dividend on Amalgamated
Copper would be raised to 8 per cent. by the
declaration of TX per cent. regular and one
half Of per cent. extra at the next meeting OF
directors. The story found sufncient Gre
dence to be made the basis Of an attack on
the short interest and the price was forced
above par. but the move brought out a supply
of stock and a sharp reaction followed the
publication OF the bank statement. The
decline. however. had the result OF attracting
a better class of buying. Some OF the traders
argued that an Increase in the dividend rate
would probably be availed Of for the dis
tributIon Of Ions stock. but the more general
opinion was that an advance In the rate
would not only improve the positlon OF the
stock Itself but exert a beneficial influence
over the entire market.
In spite Of realizing sales 81. Paul main
tanned q good deal OF strength, Its action
being regarded by the traders as substantial
evidence Of something doing" There was a
rumor to the effect that advantage had been
taken OF the recent decline by one OF the
large stockholders now abroad to increase his
line OF the stock and that this indicated not
on!y practical completion OF the plans for
financing the Pacific extension but q salts
faction with tne terms on which the matter
had been arran ged that augured we'll for the
effect OF the announcement whenever u
should be made. p
A number Of inactive industrials scor ed
subst antial advances, Indicating that the liaui-
dalton In thisc class Of stocks had ceased and
that the pools and cliuues were still in control
OF the market for their speclalties. Among
the ISSUES Oh tNIS Ci0Ss Wuich houc 90 S6iho
were Virginia Coal and Coke. Central Leather,
New York Airbrake. Steel Foundry preferred.
Cotton Oil. virRinia-Carolina Chemical. Rail-
way Steel Spring. Tobacco preferred and the
United States Reduction and Refining issues.
while Great Northern did not quite fulfil
the prediction of a rise to 500. It rose So sharply
and retained it, advance so well as to con-
| vince many OF the doubters~that there was
some substantial basis for the talk of con-
| sumusGtion OF the ore deal in the course OF the
summer.
Within q comparatively short time the ad-
] justment Of San Francisco IRE losses and the
| preparations for rebuilding will. in the opinion
! OF many financial interests. begin to make
| their effects felt In the money market and In
| the Industrial world. It Is expected that
m oney will become q drug In that city for q
time, but will be largely avaled OF to take
care Of Western crop moving requirements
In the fall, goin g a long way toward averting
strin gency at that season.
MONEY AND EXCHANGE. r.
.MonAv IN eall nominal at 3 DER cent; time