The Evening statesman. [volume] (Walla Walla, Wash.) 1903-1910, 1907-05-02
WALL STREET LOOKING UP
Money Matters In Better Shape
Says C|eWs

NEW YORK, n. Y, May 2.-Ihe
drift of affairs in Wall street is APP
parently towards betterment. Recent
liquidation of excessive speculative ac-
counts has afforded material relief III
the money markets-not only in New
York but also abroad. The expected
reduction in the Bank of England rate
from 1-2 to 4 per cent was emphatic
testimony of improvement. Over there
the situation has been distinctly bet
tered by removed of fears that Ameri-
can demands might impose a threaten
ing strain upon European reserves.
Liquidation in March removed this
fear. and the. situation abroad is grad
ually assuming the normal. While the
monetary sitaution at home is easier
owing to these causes, there are still
points which call for more or less
concern. II is highly desirable that
our bank reserves should be sertngth-
ened. The last report of the national
banks issued March % shows thai
reserves in the interior are much be-
low the average. There has been Il
tremendous expansion of $400,00o.Oeo
in loans without a corresponding gain
in tahe reserve items, and the bank
ing situation in the interior is one that
demands general conservatism. West
ern bankers appear to be quite conf
dent of another years large business
vet at the same time they recognize
the necessity for prudence. Locally.
the situation is much stronger than
three months ago; and the trcmen-
douS expansion in loans shown dur
ing the last three weeks is largely due
to the transfer of accounts from tht
interior and elsewhere to New York.
This should serve TO strengthen in
terror institutions; though it imposes
q heavier load uptn New York. New
ertheless, there IS better feeling in
local banking ircleS tnan ror some
weeks; and the hope is expressed that
reserves will shortly begin to rise in
order to meet the trade and crop re-
ouirements of spring and midsummer.
Fortunately there are indications OF
abatement in the new demands for
capital. The railroads are DOstpOninS
some of their new enterprises. and con-
filming iOutlays to strictly necessary
improvements. Bankers are also turn
deaf ear to rev sSNemes and to
speculative propositions. The policy
of caution, which is everywhere preva-
lent, should avert any serious difficult
ties.
The opinion is growing that mod
crate recession In business must be
expected. The mere fact that new en-
terprises are being undertaken with
more care will result in a lesseneI
demand for both commodities and Ia
Dor. Reaction usually begins at the
ton, and there is already a noticeable
lessening in the demand for luxuries.
| The shrinkages in Wall street were
felt most severely by the rich and the
! well to do; hence the masses have
escaped it's influence-for the present
at last: and only in course of time
can it extend itself throughout the
line. Labor is still actively employed
at good wages and is consuming freely
of all products. This means COW
tinued active consumption for all the
great staples of commerce. Much will
depend upon the next harvest. Near
" all of the crops are unusually late
this season; but there IS. of course,
ample time for recovery.
Railroad gross earnings in February
OF "a railroads amounted to $1240o0.-
900 an increase over last year Of S.
SOC, 900. During the same period ope-
rating expenses increased nearly $1O.-
500. 900. leaving net. earnings $780,
600 less than in February of last year.
This is striking example of the effect
of recent tendencies in general bust
uess-that Of increased expenses. 1t
shows that In spite Of much larger
gross earnings, the increase in ex-
penses wiped out all this gain and left
instead a decrease. Another indication
| which cannot be overlooked is that fur
nished by clearing house returns. For
the last three weeks these have shown
steady decline compared with last
year. The heaviest shrinkage was. of
! course. in New York. where specula-
| ton was at minimum. but ii is to be
| noted that a number of leading cities
| in the east and also in the west are
showing smaller returns than year
ago
The future of the market does not
promise any pronounced movement in
either direction. Many of the worst
features in the outlook have been fully
discounted, and it seems quite prob
able that the stock market has also
anticipated any moderate recession in
business activities. If left to itself the
market should gradually recover and
assume a firmer tendency. The period
of hysteria is over and confidence is