The Washington herald., 1907-03-14
WALL STREET NOTES
Bears Make Raid and Prices
of Stocks Crumble.
FOREIGN WEAKNESS STARTS IT


Germany Is Borrower at High
Rates-AttaeIS on Hill Issues Sue
cessfuI and Others Tumble.
New York. March 13-Generally when
the market breaks some stock or group
Of stocks can be picked out as the leader
of the decline, but this was not possible
to-day, for the whole list started on the
downward course at the same time. giving
a greater appearance of genuine Aquida-
ton than had before been witnessed in
quite a considerable time. The slump was
unexpected owing to the distribution in
the foreign markets and the supposition
that relief for the money situation would
not come from gold imports if the Bank
Of England could prevent an outflow Of
the yellow metal to this country by rails
ing its rate OF discount.
The decline in consOls TO a lower level
than they had touched during the Boer
war naturally exeTted a very depressing
influence over the London market, and
added greatly TO the effect produced in
arousing an advance sentiment toward
all kinds of foreign securities dealt in IN
the British metropolis. New York could
not resist the influence abroad and re-
newed outbreak of liquidation occurred
right at the opening Of the market here
Discussing the report that Paris has
been lending money in Germany at as
high rate as 8 per cent the representa-
tive of a large foreign house said there
was nothing so very improbable in the
story. 1T has come TO the point in
Germany" he said, where it is not "A
question of the rate demanded for money
but of the ability of borrowers, even
those possessing the best of credit. TO OBJ
tain what they need on any terms. The
French insist on good security, and /
have little doubt that they have been
able 20 get II in cash. even where they
charged a rate Of interest that was
usuriously high. 1t was simply impos-
/ sible for corporations to carry on their
( enormous business without borrowing
{ large sums of money, and this being the
case they simply had TO pay the high
rates"
| The market had not long been under
way when the bears threw their full
! force against the Hill stocks. believing
/ that there were still some large specuia-
tive holders Of these issues that could
! be forced to disgorge. As a result Of the
attack Great Northern and Northern
I Pacific soon became the weakest features
I Of the list. although. OF course. prac-
4 tically everything on the board was af-
fected by the violence Of the break IN
/ these reported issues. There was no
/ specific news bearing on the Hill stocks
/ that was not common 10 the general list
/ except that the bear clique believed there
were weakened margins that could not
+ easily be repaired and that a vigorous
attack was all that was needed to force
out stock. How some Of the traders felt
about the market position of the stocks
was indicated by the fact that when one
said there We're holders Of Great North
/ ern and Northern Pacific who were just
holding on by their toes and eyebrows.
another interrupted 20 say that the toes
had slipped of and the eyebrow hold
was all that remained. That Liquidation
was forced it would be idle to deny, but
It seemed as if the largest part of II
came from people who had bought on the
rise about week ago when the stocks
were the strongest features Of the mar
ket The expectation that a new low
level would compel large holders who
had not been disturbed by the break twl
weeks ago to liquidate was hardly real
lied, for after the previous low points
were passed on the decline in both stock
the bear drives, although very vicious
did not succeed in dislodging any cOns!d-
cradle quantity OF stocks
The weakness in the Hill stocks, while
it did much 70 demoralize trading in ths
forenoon, pa!ed before the break in
Union Pacific. which later became the
feature on account Of the tremendous
activity by which the latter was accom-
panied The arguments in both cases
were the same-that there were accounts
that would have TO be Hquidated if The
decline was only severe enough 70 further
weaken the margins Of people whose posi-
tion was none too strong at the time oi
the last break. Various stories were told
OF this, that or the other holder OF
. stock who a few months ago had been con.
sidered rich-carrying high-priced stocks
. FOR Investment on 40 or 80 point
margin-but who were now reduced tC
the necessity of marketing their invest
meut" holdings regariles of the prices
that could be obtained for them. ThS
bears saw 10 IL that where there wa,
liquidation Of this Kind the prices realized
should not be high. and emboldened by
their success after The previous low pOiu
Tor the year had bgen broken through
continued to hammer the stock ever
when they themselves were willing L
concede that the price was under value
Not until the appearance of the report
that the Secretary of the Treasury in
tended 20 come 20 the relief Of the money
situation by deposiung $50, 00,O0O in TN,
banks, aid they make any efforts to saw,
some of their profits BY covering con
tracts, and when the story failed of con
frmation they proceeded TO sell again
and the stock closed practically a. tn,
lowest of the day.
Regarding The stories of Treasury re
lief. banking interests said they had NJ
information. and perhaps in their expires
sions of belief that the Treasury woulC
render assistance. IF necessary" ther,
was a veiled intImation that a necessity
had not yet arisen. The belief that tall
of relief by the Treasury was prematur,
induced the bears TO renew their attack!
upon the market a little before the close
so that many stocks lost their rally an,
closed at practically the lowest figure o
the day.
One broker who bought quite a littl,
stock during the day. when asked wha
he thought was the cause of the declin,
In the market, replied: Simply a brain
i1faw-, F.tvnTTfvos O.. Gv.,es,1 .t.f.F7.