Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-12-08
Financial News Letter
BY W. G. NICHOLAS.
Special Correspondence of The Star.

Special Correspondence of The Star.
NEW YORK, December Z, 1907.
This is n good time for bulls and would
be bulls to restrain themselves. The stock
market has had a very good advance from
inside quotations, and during the later
stages of the recovery this week there
have been many evidences of rank manip-
ulation. An imitation bull movement has
been conducted largely by people who
have stocks and bonds for sale, and large
ly also at the expense of the short sellers.
Conditions do not justify reasonable eX-
pectations of a continued rise in prices at
this time. Ten days or two weeks ago
the best that was hoped for was a mar
llet which would hold at about the then
! current range until the clouds rolled by.
| Since then some of the leaders advanced
| five to ten points. with every surface ap
pearance of enthusiastic outside support.
There has unquestionably been substan-
tial buying of securities for investment
account by people with money in every
part of the country. This buying has
been on a sufficiently large scale to alb
sorb good amounts of securities. but there
yet remain unsold in the hands of banks
and people who have been obliged to buy
70 sustain prices very large quantities of
The goods. and this stuff will be showed
cut as a market is made to take them.
Jile kind of a boom which has been wit
Eessed during the last week is god
send for the banks and commission
houses which have been Juggling along a
mass of stuff by the eyebrows, and they
welcome joyfully the opportunity to
tighten their loads 1t is no time how
ever. to look for sustained improvement
and broadening speculation with money
conditions as they are.
True, the acute phase of the scare is
over and people are getting back tner
.
test of endurance has brought about
partial reservation of confidence In the
stability of banks and trust companies,
and has put stop to the foolish hoardlng
of funds and their withdrawal from chan
nels of business. The fact remains, never
| theless, that there is still scarcity or
currency; that there is no money avail
able for speculation; that merchants from.
one end of the land to the other are
sea red half to death and sacrificing goods
to get money with which to meet obliga-
tons, and that there is ahea dof us we'll
defined period of industrial depression and
inactivity. These signs of the times are
not broadly encouraging and do not give
support to any theory Of great bull
movement in the stock market. For this
and numerous other reasons the bullishly
inclined will he likely to save themselves
money and retain their peace of mind by
sleeping over any impulse that may seize
them to jump into the market and buy.
The market will be here tomorrow. next
day, next week and next spring. and there
will still be bargains to be had for many
a long day to come. Meantime there will
he periods OF depression, and those with
patience need have no fear of getting
left.
December is always a period of tight
ened money. This year ordinary con-
ditions leading to strinEency have been
emphasized immensely and the things
which make ordinarily for December
stringency will be operative during Janu-
airy and well up into February. The No
vember and December movement of farm
products has been showed ahead for Il
month or six weeks, owing to the in
ability Of the frontier buyers to get the
cash with which to take stuff from the
hands of farmers and planters. There
was almost a complete stOppage of traffic
in many parts of the country-a condition
almost of paralysis existing. This unfor
tunate and uncomfortable situate is be-
ing gradually relieved and relaxation is
noticeable.
Wall street feels this very keenly and it
is largely on account thereof that the
stock market has experienced season of
buoyancy and an accompanying uplift in
prices. That fact. however, does not blind
US to the actualities of the Wall street
situation. Before there can be any i'm
portant surplus for employment in specu-
latve channels premium on currency must
be entirely obliterated, $4,000. 600 to $780,
O0O coo in New York clearing house GER
tifcates and as. much more issued by
other communities must be retired, great
masses of securities held unwillingly as
collateral must come into the market and
be absorbed and provision made for the
obligations incurred III the importation of
approximately S9OO00,0GO in gold. Then
on top of this will be the need of putting
back into the federal Treasury very
considerable sum.
The government has virtually exhausted
itself in helping out and in avertins panic.
This money will be required in the pay
ment of governmental eXnnnseS ard the
banks will be drawn upon heavily to meet
their requirements All this will be Il
drain upon the banking communities, and
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