The Cairo bulletin. (Cairo, Ill.) 1???-1928, 1907-12-02

--,
New York, Nov. 30.-SpeciaI.- .
There is a distinctly better feeling n
the financial situation due clmost en-
tircly to Improvement in the none,
market which has been working oul
its own cure. Hoarded currency Is
being returned; foreign gold is pour
ing into our Golfers; bank reserves
ARE beginning to rise, the credit situa
ton is less strained; call and time
money rates are lower and redemp
ton Of Clearing House certificates Is
already In sight. These ymptoms OF
relief have fortunately shown them
selves even before the additional cur,
rency furnished by the Government
had become available They show
natural and healthy tendencies to-
wards recovery. AS q result we have
had fair rise in tho stock market
and confidence has been correspond.
ingly improved. 1t Is quite evident
that the corner has now been turned.
and that liquidation IN the main Is
complete, Possibly further weak spots
may develop later on. but thee prom,
Use to be Of minor Importance. After
the enormous shrinkage and liquida.
ton of the past Few months. the
market is evidently on safer and
soundel basis than it has been for n
long period and as soon as the none
tary situation rights itself and con.
iide0ce is more fully restored, values
should go back to q more normal
level
II is not pretended that the market
viii promptly or wholly recover from
the terrific shock which it received
IN October last. For some time to
come irregular markets must be ex-
Dected with more or less depression
and inertia. 1t must also be remember
ed that there is comparatively little
money available for investment The
country's liquid capital has been prac.
tically exhausted, SO that time Will
be required for the accumulation OF a
fresh supply; and in view of the re-
dictionary tendencies which have de-
Veloped in business,it is quite prob
able that a longer period than usual
VIII be required for saving purposes.
Another factor which must not be
overlooked is that in spite of the
large volume of business profits are
showing material shrinkage, ow.
Ing to the immensely augmented cost
CT doing business, This is strikingIv
Illustrated in the current returns Of
railroad earnings. In September tho
roads reporting showed gain of over
St3,0000C0 in gross earnings. while
net earnings showed loss of $4,000.
700, During the nine months ending
september there was an increase OF
Sl36,500000 in gross earnings accom-.
panied by an increase or only SIS
100000 in net earnings. This is all
almist startling diminution of rail
road profits, especially when ii is
that gross earnings are
making less and less satisfactory re.
-urns. while the increases of ex
)enses are still abnormal. No doubt
he railroads will soon be- compelled
20 make every possible economy in
operations. Many improvements and
extensions have already been post.
loned. and it is serious question IN
he minds of conservative managers
it win be either possible or
good policy to maintain the high rates
IF dividends which have recently been
)aid, especially in view OF the very
ow prices at which many excellent
stocks arc selling.
Now that the panic is over and
sober view is taken OF current events
he question is constantly asked.
What caused the crash? The answer
$ necessarily difficult one. because
he causes wero many and complex
Tbe main reason, however. has been
hat of general OVERRIDING. Credit was
over extended; speculation was ex
'essive and illadvised; expansion OF
Every sort was being carried TO excess
Dl over-confidence. until finally the
'ountry's floating capital was prae
ically exhausted through being turn.
ID too rapidly from liquid into fixed
'orms We have only to glance al the
demands upon new capital during the
past year or two to realize this fact
During the first ten months OF the
current year. the amount OF new So
;urities authorized amounted TO over
'l.15o.000000, Of which at least al
was actually issued. These
ignres simply include railroad and I'm.
iustial securities and notes. the great
bulk OF which was offered prcvious 70
september first The year 1905 vas
Use period of exceptionally heavy
Esues. the total then being $500
100000 authorized aud 81 500 GOO ooa
5sped within tho twelve 1onth-
These figures take no account q, the
issues of municipal securities and
hose Of many other business con.
Germs Of a minor character. but they
are quite sufficient to Indicate the
extraordinary demands upon the
money market during the las. two
Fears. demands which in coneDcfiou