The Cairo bulletin., 1907-12-02

New York, Nov. 30.--Special.-- ~
There is distinctly better feeling Il
the financial situation due elmost en-
tircly to Improvement In the none,
market which has been working ou
its own cure. Hoarded currency Il
being returned; foreign gold is pour
ling into our Golfers; bank reserves
are beginning to rise; the credit situa
ton is less strained; call and timt
lmoney rates are lower and redemp
ton of Clearing House certificates Is
lalready In sight. These ymptoms OF
Erelief 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 result we have
had a fair rise in tho stock market
and confidence has been correspond.
ingly improved. 1t is quite evident
| that the corner has now been turned,
land that liquidation III the main is
! eompletc, 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 rev months, the
market is evidently on a safer and
sounder basis than it has been for a
long period and as soon as the none
tary situation rights itself and con
fideace is more fully restored. values
should go back TO more normal
level
IT Is not pretended that the market
will promptly or wholly recover from
the terrific shock which it received
in October last. For some time to
come irregular markets must be ey
pected with more or less depression
and inertia. 1t must also be remember.
ed that there is comparatively little
money available for investment. The.
eountry's liquid capital has been prac
tically exhausted 50 that time will
be required for the accumulation OF d
fresh supply; and in view of the re.
dictionary tendencies which have de.
ycloped in business,it is quite prob
able that longer period than usual
VIII be required for saving purposes.
Another factor which must not he
overlooked is that in spite OF the
large volume of business profits are
showing a material sh1'inkage. ow-
ing TO the immensely augmented cost
OF doing business. This is stlikinglv
Illustrated in the current returns of
railroad earnings, In September tho
roads reporting showed a gain Of over
Sl3,O0o0t0 in gross earnings. while
net earnings showed loss of $4,000.
coo. During the nine months ending
September there was an increase or
$l5G,50eG00 in gross earnings accom-
panied by an increase OF only sI5l
100000 in net earnings. This is az,
almist startling diminution of rail.
road profits, especially when il is
considered that gross earnings are
making less and less satisfactory re.
turns, while the increases of OK.
penses are still abnormal. No doubt
the railroads viii soon be- compelled
to make every possible economy in
operations. Many improvements and
extensions have already been post
poned. and it is serious question in
the minds OF conservative managers
whether it will be either possible or
good policy to maintain the high rates
of dividends which have recently been
paid, especially in view of the very
low prices at which many excellent
stocks are selling
Now that the panic is over and =
sober view is taken OF current events
the question is constantly asked.
What caused the crash? The answer
Is necessarily difficult one. because
the causes were many and complex
The main reason, however. has been
that of general OVERRIDING. Credit was
over extended; speculation was OK
eessiye and ill-advised: expansion of
every sort was being carried TO excess
by over-confidence. until finally the
eountrys floating capital was prac.
tically exhausted through being turn.
ed too rapidly from liquid into fixed
forms. We have only to glance at 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
eurities authorized amounted TO over
100000. OF which at least al
0eo-O0o,oo0 was actually issued. These
figures simply include railroad and in
dustial securities and notes. the great
hulk Of which was offered previous IN
Septembcr first. The year 1905 vas
sise period of exceptionally heavy
issues. the total then being 81 SOC
100000 authorized aud 81 s0a non ooo
Issued within tho twelve month";
These figures take no account Of the
issues Of municipal securities and
those Of many other business con.
Germs OF minor character but thew
are quite sufficient to Indicate the
extraordinary demands uDon the
money market during the las. two
years; demands which in coneBctioa