The Cairo bulletin., 1907-07-01


parent thoroughness OF recent liquids
Y tlon, partly to the beneficial effect
Governor Hughes recent address d
two-oent-fare legislation, and partly [
! q growing better understanding b,
tween the Mflroadse and the publ,
me only serious obstacle TO furthe
Improvement has been the unsati.
factory condition Of the money MAJ
b ket. This is still the dominant ole
4 ment In the financial situation.
j Monetary strlngency is world wide
II is not confined to New York BIZ,
prevails in all the worlds principa
financial centers 1t Is primarily dut
] TO the exhaustion of the supplies d
capital through wars. earthquakes
coniiaGrations and especially to extra
J ordinary Industrial activity and devel
lopment in all parts Of the world The
high rates Of interest which have
! followed in consequence Of the scar
city Of capital are imposing d check
upon all sorts CT business activities,
and have already forced a very MA.
fterial decline in security values.
There Is considerable assurance how
| ever, in he fact that the causes Of
reaction in securities have been gen.
eral and not strictly local, although
our own financial depression which be.
gan six months ago was no doubt
much aggravated by local Influences
| Apart from the temporary disturb
lance Incidental to July disbursements,
the American money markets are GER
Itainly in an unsatisfactory condition.
Bank reserves are uncomfortably low
for this period of the year; and loans
arc much expanded. particularly IN
the west, as shown by the last call
upon the national banks. In spite OF
these conditions the demands for new
capital are extremely insistent and
only the best class of applicants Sc
cure recognition, as shown by the
continued offerings of short term notes
and relatively low interest-bearing
municipal securities. Call money has
been comparatively easy but firm
rates prevail for time money and such
are likely to continue for some months
to come. Next week the July dis
bursements aggregating over $780, |
100000 will be in order. These viii |
nave slight effect upon the money |
market, because the bulk of this sum
is already loaned upon call
The treasury is gradually with
drawing the 100000 600 now on de.
posit with the banks, but this sum will
be promptly returned through bond
redemptions and July interest pay
ments. All things considered, the
money market in New York is in any
hing but healthy condition. Onr
rank note circulation is redundant
'efuses to contract because of the s
absence of an elastic currency sys. !
en-; an dthere is no cure in sight, II
Except that which comes from lessen ,
ii activity and self-righting. Time is 4
absolutely necessary for the acqrisi q
ion of a fresh suqqly of capital Time c
viii also be required for the distribu. \
ion OF congested security issues A
Which now press upon the market. If c
II alone, the money market will event t
ally rectify itself but it Is very eyi- {
ent that strong restraint are careful | il
iloting will be necessary for some Il
me to come 10 avoid the pitfalls y
,bfoh beset the situation every n
here. Our harvest is approaching f;
nd before long the seasonal demands 4,
pf 70 / 1
Ioney market viii pass through that v
eriod without embarrassment Of some
,rt or not Is beyond calculation at
lis time. =
The gold export movement appears y
have nearly eliminated. Approx
ately $25.O00,O00 OF gold have thus
r gone to Europe, chiefly to Paris.
old seems To have been required
ere for the purpose of Strengthening nj
e reserve of the Bank OF France
hich has been lower than usual
1nsidering the disturbed state OF IN
iitical affairs in Russia and France.
we'll as the financial strain in Der on
]. it would seem prudent for that
to make its reserves reIa.
ely as strong as those of the other Oh
eat European banks. No concern NJ
IS felt at this loss Of gold in tho
irket, for the reason that the stock IN
the precious metal in the United
lies is very large. At the begin ri.
" Of June our net gold imports for "
! year amounted to over $50 600 600.
4 duringt he past three years We u,
We added over s100.00O.O0O to our Ga
lply Of gold from foreign sources
we are at the same time a largo 81,
lducer Of gold. il is quite evident 9
Il we could have spared even a
oh larger sum if necessary. par I
1larly as il went where Il was most ree
sded and relieved a strain. the i
ieft Of which viii be reflected in sr
market. :
y tside Of the money market there eoc
reason for increased confidence I
.urlty values are often very Low n
IN the earning capacities OF rail I,
ds are considered. II present rates The
dividends are maintained. many n
leading railroad shares would be 2
sidered prime investments at cur Pa,
! - 80. - ~.rr g. che rr-1~t