The Birmingham age-herald., 1907-10-21
COUNTRY ENTERS ON
 BUSINESS REACTION
HenryCIeWS Says Talk of Panic
 Is Folly
BREAK IN COTTON STAPLES
Wave of Depression May Extend To Every Portion of Country-lron Feels the Reaction Least of
 All Metals.


 In view of the interesting developments of the past week in Wall street the week. ly financial review of Henry Clews of New York is presented in full, as follows:
 The week has been period of feverish- ness and unsettlement in the stock mar ket. At times the street was full of dis turbing rumors, and the embarrassment of one important operator in copper add ed to the prevailing disqualification. This continued liquidation was, of course. part of the general reaction which began with contraction in the money market, was accelerated by various exposures and legislative attacks, and is now causing wholesale and somewhat radical financial house cleaning. How far the decline will go it is beyond human knowledge to pre- dict; but it is safe to say that many of the rumors in circulation were gross ex- aggerations, and that there is no need for any repetition of the financial hysteria which marked the August break in the stock market Since January first we have had shrlnkage in securities of fully, if not over, s, GOO Many good railroad shares have had their values cut in half during that period. The indus trials have suffered even more drastic decline, being cut not only into halves, but into thirds and quarters. After such q tremendous shrinkage, it is almost folly to talk of panic V4blent breaks may be possible but the chances of genuine panic with%all the disaster and derange- ment which that means are exceedingly Had the developments which have recently taken place occurred on the high level of year ago, we might, in- deed. have had to face q cataclysm. As it is. the stock market has endured one of the greatest declines in history; de- cline equivalent to that of great panic but in an orderly and well distributed fashion. Losses have been enormous, but they have been admirably met, and con sidering their extent, the disasters fol- lowing have been remarkably few.
 May Not Be Completed.
 It is vet too soon to take a very reas- suring view of the future; for it is by no means certain that the house cleaning process is complete. There are still points of weakness in. the market, and no per manent recovery can be anticipated until these have been thoroughly eliminated. Many good securities are today selling at exceedingly attractive prices but buyers will not take them until doubt has been and this continued withholding of genuine buying has much to do with weakness. Moreover, buyers are becoming exceedingly discriminating, in- vestors showing a marked preference for securities with management of high repu- tation. About the only buying element. however, at present is the short interest. This has been greatly extended, and pur- nhases to cover on pronounced reactions appear to be the main support of the market for the time being. The number of bears has materially increased, but that element is conspicuousy lacking in leadership. In previous years the big life insurance companies have often been large purchasers of stocks in times of panic or great weakness: likewise the in- dividuals more or less connected with the of these great institutions. The law, however, now prevents such operations, and the market is deprived of that element of support in cases of emer- gency.
 The monetary situa ton shows little change. High rates are still in force and bankers are discriminating sharply as to collateral and names While firm rates are anticipated during the re- mainder of the year, there is little fear now of extreme stringency. The demands of the interior for crop moving purposes have about reached their height. Very soon funds should begin to return from the interior. Secretary Cortelyou has not entirely exhausted his resources, and in case of lemer- geney it Is confidently believed he would afford further assistance. The prospects of gold exports have also been modified by an increased supply of commercial bills afforded by the out ward movement of wheat and cotton. Europe is taking our wheat much more freely and at present high prices this a dds materially to the supply of ex- change. Our foreign trade also makes more favorable returns, since exports are increasing and imports decreasing; thus permitting a better balance of trade than was experienced during the summer months. In September our merch andise exports were valued at s135 ,30O,06O our imports at $106,300,- 900, leaving the excess of exports for the month at s29,o0o,000 A year ago the excess of exports was $35,700,00o, and in 1905 the excess was $3400O,000. For some time past the tendency has been toward diminishing balance of trade. the high prices prevalent in the United States tending to restrain ex ports and stimulate imports.
 Entering on Business Reaction.
 The question now of greatest mo- ment to business men is: Are we enter ing business reaction? Every indi- cation points to an affirmative an- swer. Wall street being the financial nerve center of the country is the first to feel setback. From hence the wave of depression will spread to every section of the country with more ar less severity. Improvements, enlrage- ments and new enterprises of all sorts have been checked by the developments at the chief financial centers. Copper