The San Francisco call., 1906-08-22
THE WALL STREET FuRoR.
What Posted Authorities Think of the
Situation.

W hat Posted Authorities Think of the
Situation.
Two Of the best posted houses in Wall street
express decided opinions Of the current Wild
speculation there.
J.. S Bach & Co. say:
- security markets seem to reflect bullsh condi-
= Ions. The tone Of strength evident this week is
- natural consequence OF material prosperity.
me old cry that Wall street is the only blue
sett m the country is not heard today; the
S.ellraty. railroad and industrial corporation
statements coming TO hand show a monOtonous
lIssresse IN gross and net earnings Speculation
WIS put this week 10 fever heat in anticipation
.ot nn increase in Union Pacihc's semi-annual
9HlQend and the declaration Of the initial divi-
essno on Southern Pacific. These stocks advanced
20 record prices with general strength throughout
THE very spectacle Of advancing prices is the
best .argument TO the outsider. Prices advance,
and then continue TO advance. and the impatient
outsider, waiting for a reaction. at length de-
spaIrs OF its coming. and rushes in and there is
"a ooom When the appetite Of the public for
stocks is aroused no power can stay It's energy
s1tu.lt Is satisted by the food it is hungry for.
4'AflLhS reactions always due in a healthy bull
market. We think the fan will see activity with
broader ana higher priees'
ANOTHER VIEW.
Henry Clews says: Dividend rumOrs have
Apmlnated the market Of late All other infu-
ences 20 matter how favorable. have been OF
on Union Pacific and Southern Pacific declared
yesterday have now been pretty well discounted.
ana The big men who are unouestionsbly endeaV-
orlng 70 create wide bull market have been
Gnd stil making increased dividends their
. trump card. Conditions were probably never so
ksarorable for s strong market as Just now Only
-Ho very important hindrances interfere First.
prices are now exceedingly high; high enough, IN
me opinion OF most judges 10 discount all the
good features in the situation Second. any ex-
tended Wild bull campaign would 70
market. Business and crop demands are exceed
lnsly heavy nd.must be met Speculative re-
quirements at such times will have TO take a
oack seat and stringent money rates would very
likely prectp1rare unweicOme liquidation in the
stock market. But just here comes another ele-
ment IN the situation. The big men have plenty
~ stocks which they are endeaToring TO distrib-
ute on the high level This they cannot conceal.
Meanwhile. the public and small buyers are shy
n tse market at present figures. ana not
likely % take hold without better Inducements.
They ind that stocks sometimes decline on good
news and are apt 70 be little skeptical about
the talk and erect OF increased dividends; esPe-
ssl-E after Thursdays experiences regarding
dends are justified. and must come. is evident in
many directions: but stockholders are remarkably
patient in waiting for their share in the much
talked-of prosperity. Wages have been advanced
and labor has already received its share Vast
sums have also been expended upon improve
and secure economy in working expenses. Out OF
the extraordinary gains in gross earnings little.
and frequently no benefit has accrued 10 the
stockholder. Is he 70 have his turn before the
tide turns. must be remain forgotten?
TIE OUTLOOK
The future OF the market for the next few
weeks depends largely up0l monetary conditions
All important factors are In favor OF bullish ma
nipulation except the money market. Rates for
both call and time money are advancing. and
rlis IS suggestive. Bank reserves low, and
must 90 still lower; for the interior demands
which VIII be not less than $50 0OO. .O0O and per-
laps more. have not yet made themselves felt.
This demand VIII have TO be met either by q con-
traction Of loans or gold imports. In OF
emergency, Secretary Shaw may increase his de-
\ k'osirs with the banks and soften the tension.
III the face OF such hindrances however, a run
MFaT bun market would have 10 overcome much
B'2osltion. The outlook is one that calls for
prudent operations, and purchases should be at
tempted hereafter only on the pronounced breaks
which may come when least expected. especially
after the largely increased dividend influence Of
The Union Pacihc and Southern Pacific has spent
It's force The announcements OF 800. o00. 600
new stock by Chicago and Northwestern and
SD. .o0o. 600 by st. Paul not good arguments
for higher priees -