The sun. [volume] (New York [N.Y.]) 1833-1916, 1906-12-31

BEGINNING OF June the market was quiet and
variable, becoming weak at the end Of june
under selling of stocks attributed 10 the dis
gust Of the larger financial interests over
the Governments policy in regard TO cor
poration matters. There was again a re-
covery ollowod by a break in July. the last
movement being caused ostensibly by the
weakness in the foreign markets owing 70
the drop in Russian bonds and general fear
OF financial troubles in Russia. Dulness
and irregularity again prevailed up 10 the
middle of August, when the entirely unex-
pected announcements Of the 10 per cent.
dividend rate on the Union Pacific common
stock and 5 per cent. on the Southern Pacific
shares caused a violent rise in prices. On
August 20 there was heavier trading than
on any day since 1904 and the market held
strong throughout the rest of the month
despite the failure OF the Real Estate Trust
Company OF Philadelphia for 1000, 900.
As September began the money situation
doomed up as the one important influence
that the market had to deal with. Although
there were further heavy imports of gold
the local Clearing House institutions re-
ported the largest deficit in their reserve
holdings recorded since 1908. Time money
rates advanced to ] per cent. and the stock
market became weak. the political am
paign in this State playing some part in
the decline. The market again rallied al
most as much as it had previously declined,
but was still unsettled and fell violently in
the middle Of October on the news of the
advance in the Bank OF England's discount
rate to 9 per cent. Recoveries. dulness,
sharp advances and declines were since
xAx~.ko0lAl L. ko~~c.n,. u..rnnr "a,
to December /, and during the present
month the tendency OF the market has been
rather steadily downward. During all this
time, or at least until the very end of the
there was no dia gnostician Of market
conditions who was not impressed with
the salient fact that the market was al
ways and continually under the perfect
control Of the great financial powers.
1t never passed o of hand, " and it's re-
was 30 effectively displayed that it
not the slightest temptation for
ventures for a fall in values.
Again. while the security market was wab-
bling about in this way, business through
out the country was mounting without
any cessation or reaction whatever to new
record heights of prosperity and afluence.
The cumulative output of the country's
was never exceeded and their value
rose to the mark OF 81, ZOO, OOO, 900, never
before recorded. In the last quarter Of
The year there. was added TO the wages OF
employees alone an annual distrt-
button at the rate OF over 500, 900. 900. Only
expressions could be used to
the state of the iron and steel
business and manufacturing industries Of
svery description, the influx of immigra-
the enormous bank clearings, the
of the mines and the general de-
mands made by business upon the country's
Of labor; while the only stories heard
from the country's railway organizations
was their inability to handle the huge vol
of business that they were asked to
AXE care of.
The curious feature of the situation was,
thus, that in spite OF a presence of prosperity
the country 80 great az to have
almost unbelievable a few years ago.,
the stock market did not advance.
Prices at no time rose b We the high level
in the first week in January. and
1t the end of the year are considerably
below this average. IL was not, indeed,
until the latter part Of the year that it be-
evident what the trouble was. The
vast business of the country had brought
about such an absorption of money that
the supply of money had itself
enormously and had been i'm
swollen also throughout the
decade preceding, it was still not large
TO make the buying of stocks for a
rise on a margin basis other than a costly
operation or to avert a disparity between
he interest yield OF stocks and the price OF
money in the open market. In the ex-
1ense Of commission house brokerage dues,
he stock transfer tax and the high interest
made for carrying" stocks a large
mathematical percentage against the specu-
for the advance in securities was
presented. Against his force the
'tock market bore up wonderfully through
tut the year az a whole, people still look
and with good reason, upon the actual
,slue of properties and their large I'M
surplus earnings, which were con-
being increased. rather than the
natter of a current distribution of equities
" profits. Toward the end of the year,
10 wever, the pressure of monetary CON-
litions became too great TO be borne with
tut some recession in market valuations.
after the value of the long talked of rights"
II at least some of them, had been or were,
10 an immediate prospect, deducted from
Northern Pacific. Great Northern and
Paul stocks, the feeling gained ground
these high priced stocks were selling at
fundamentally high in the face Of the
money market. and heavy llquida-
ion in them set in which carried the whole
market with it; although considering the
of the decline in the particular
named, it must be said that other
tocks on the list were affected much less
han might lave been expected.
Views as to the state OF the stock market
of business conditions in the year TO
as they are entertained in the inan-
ial district at the present time are naturally
UGH as follow from the conditions that nave
cen described. The problem is how TO find
money enough TO carry on at its normal rate
Z increase the great business of the country
nat has been developed and at the same
me 10 provide funds sufficient for those
peculative uses OF Wall Street that neces-
arily and legitimately flow from the pros
OF business itself. There is no aues-
ion as to the outlook in the business world
The orders placed for goods, the
If tra f9o IN the ra{lx.yar Eno. Al.