The Birmingham age-herald., 1907-07-22
CROSS CURRENTS
 OF SPECULATION
Financiers Still Dubious of
 Market Conditions
IRON TRADE STILL QUIET
French Writer Gives Ills View of American Finances By Saying That Proper Investment Basis
 Will Now Be Reached.

New York, July 21.-The stock market of the past week having revealed the cross currents of speculative sentiment running on the one hand, through the channels of the Northwestern and Pa tended on an advance in prices and stimulation of speculative interest and on the other hand in the industrial devel- opment where evidences of trade reac- ton caused some depression and hesita- ton. The easing tendency of the money market has ben a reviving influence on securities but this was under restraint of the strain of the interior demand for currency to move the crops maybe ex- pected to draw on New York banking resources. The stirring of speculative in terest in limited group of stocks has not proved convincing of any revival of substantial investment demands.
 A recent article by M. Paul Leroy Breaulieu the distinguished French economist. annayslzlng the problems of the decline in investments securities and prospects for their recovery, concludes that d period of imitation has led Up to the present situation, which conclusion l commands general agreement. There must come first, a shrinkage of speculat- i've securities, next the fall in prices of raw materials of manufacture, notably metals. Real capital, he holds, presents an insufficient supply for nations whose spirit of enterprise so far stimulated as to lose sight of all limitations, as he maintains has been the case. He concludes that the United States has undertaken to spend in 0 single year for all individ- ual and financial purposes two billion to two and one-half billion dollars, while the annually accurlng capital from the Unlted States does not reach one-third of that sum. Meantime, foreign supplies of capital were absorbed in unusually large home enterprises and were depleted also by the decrease of capital in war loans and in the San Francisco earth quake. From which it has followed that users of capital must pay more for 1t in a higher interest rate and they will have to postpone or extend for several years many enterprises for which prepar- ation already has been made. Industrial and financial markets must, in a meas ure, reduce their scale of prices and, in some proportion, the prices of raw material must come down.
 Events have too far proved the opera ton of all these forces to leave room for dispute. The Journal of Commerce has made a compilation of new securities created in the United States during the first half of 1907, showing a total of $l,27S 72S, 800, with fissues since Janury 1, ol S799,3i2, loo. Of this amount $5O3,651, 600 has ben in short notes at high interest rates reflecting the urgency of the re- quirement.
 M Leroy Beaulieu says: "The existing situation in the financial markets of fers to capitalists and investors gener- ally the opportunity of which they have benen deprived for nearly twenty years of securing a suitable return on their invested capital"
 Nevertheless, investment demand in the Ne,5 York market still holds. One of the principal restraining factors during the past week was the declining in prices of the metals.
 Reports from the iron and steel mar kets were of a falling off in orders for finished products and a condition of com plete dulness in the iron market with fears of a possible deadlock between buy CTS ana sellers such as characterized the copper market. Authorities In the iron trade say the prospect promises a re- turn to more normal conditions with assurances of a waiting demand on re- adjusted price basis sufficient to afford ei Colt-uuduCe ol nlBnly prosperous con- ditons
 The extent to which the curtailment in future plans of the railroads may eff. feet the demand for iron and stel is as vet an unsolved problem. In 1903. which is the latest period for comparison of similar coalitions, the railroads were used for capital supplies and forced to re- trench, but without marked effect on the resumption of iron products until during the second half of the year, when the trade was in deep depression before the expiration of September.
 News of the crops last week were sat isfactory and added to the confidence that the country will have an available sur plus to supply the urgest needs of Eu- rope, at highly profitable rates Money rates relaXes here and abroad With the winter wheat harvest already under way and the New York exchange rate at Chicago declining the period of the com inc demand on eastern bank reserves to move the crops becomes of early conse- quence