The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1907-08-04
BELIEVES BUSINESS
PROSPERITY HALTS
Henry CIews Not Optimist-
iC on Immediate Future
of Market.

NEW YORK, Aug, BIN his weekly
Meter on the condition of the market,
Henry Clews has this TO say:
Circumstances have been adverse to
improvement in the stock market, and
tone Of hesitancy prevails which is sug-
lagestive of underlying weakness rather
than strength. The greatest cause Of
encouragement was the statement that
new orders of the United States Steel
Corporation had fallen of % per cent
during the past month. This announce
lnent was received with perhaps more
seriousness than IL deserved, inasmUch
rs it emphasized the fact that the re-
action which has been experienced in
Wall Street is slowly but surely MAX
Ing itself felt IN business circles. The
larger proportion of the decline in steel
orders was due to curtailment by the
railroads made necessary through the
difficulty Of obtaining funds in the
money market. Retrenchment is now
being enforced. and this policy viii no
doubt be continued for some time TO
come. AS the railroads are the largest
consumers of iron and steel, any post
ponement of OUTLAWS on their part is
sure TO be quickly felt IN the steel trade.
When monetary conditions improve the
railroads will be enabled to more freely
interval period of slowing down must
be anticipated. There has also been di-
Ininished activity in the building trades
In certain cities, and this too eXerts its
eject upon steel Other products are
also beginning to feel this abatement in
1he demand. There has been q smaller
Inquiry for copper; the price has drop
ped to 20 cents. and a great many or
ders are held back awaiting a decline
20 about is cents; figure that would
still net very handsome returns to cop
per producers.
The weakening in the prices Of com
SnodIties, which have really been selling
unduly high, is a welcome sign 1t
means that the process Of wholesome re-
adjustment which began several months
ago In the stock market is now begin
ming in commodities; the latter being on
such a high pinnacle as 70 cause
general feeling of instability. There is
30 gainsaying the fact that while bust
ness continues in a high state Of ac-
tivity, there is still a considerable de-
gree Of distrust induced by present alb
normal conditions; and It is really
healthy symptom that the reaction has
begun, especially as 1t is making it's ap-
pearance gradually and without violent
or unexpected developments. In nearly
Ill lines Of business there is more or less
expectation that temporary reaction Is
ut hand. the only important exception
being In the cotton goods trade, where
demand Is still ahead of supply and in
dications are for another excellent sea-
son. The best feature in the whole sit
uRtion is the splendid progress Of the
corn crop during the past three weeks.
Ideal weather has existed in nearly all
Sections Of the corn belt, and while the
crop will Be less than last years bumper
yield the prospects. now are for a fall
average yield provided we are favored
with good weather during August. The
crop Is still late and in danger Of early
frost, but much depends upon the next four
weeks. The wheat crop has also been
benefited by favorable growing cOndi-
lions, though the harvest has been de-
iayed by rain; and cotton. too. has
shown considerable improvement during
the month.
AS for the money market conditions
ere stir very unsatisfactory. Bank re-
serves have not been replenished at the
rate at which they should have been,
and we are rapidly approaching the pc
Rod when arrangements viii have TO be
made for financing the growing crops
With business still very active. and high
prices increasing the demand for funds,
with large amounts OF money still locked
I'D In syndicates and great financial
Operations, prospects for the money
market are anything but clear. High
rates are practically sure TO prevail
The question Is, VIII he get through the
autumn without further liquidation OF
financial Disturbance At the moment
the money market IS faced with all the
demands which ii is possible to meet Il
IS somewhat unsettling. therefore, u
hear of rumors Of gold exports; fol
while we have an abundance OF the pre-
cious metal, and could easily spare
few millions for Europe in case of ne
cessity, nevertheless its shipment at thi!
time would have an undesirable effect
London. Paris. and Berlin are all under
going financial strain from specia
causes It is improbable that I,ondoI
would be willing to grant us the sam
financial assistance this year that /
has in the past two years. The presen
low record price of British consols
significant. and the revival Of trouble Il
Morocco Is not assuring. The presen
outlook in the stock market is for mod
crate activity. In the absence Of un
favorable Developments, prices ma
show occasional rallies, but the genera
drift Of prices promises to be downwar
until the readjustment in the none
market and in the commodity market
has gone far enough to warrant IL
covery. The pendulum has started I
swing in the opposite direction, and tn
swing has evidently not yet been al
rested.