The Birmingham age-herald., 1907-12-16
LIMITATION OF
 CRISIS DEFINED Call Money Market Shows a
 Decided Stiffening CASH PAYMENT PROLONG GED Heavy Credit Obligation of Merchants and Others in Interior Delays the Clearing Up of the Financial
 Situation.
CASH PAYMENT PROLO LONGED

New York, December 15-Last weeks financial markets reflected one of those reversals of movements by which the limitations of the existing condition be- came defined. The reaction was accept ed as a demonstration that the recovery had adequately expressed the improve ment in condition and, in fact, might be regarded as ruling beyond that point. The later stage of the rebound in prices was due obviously to the needs of an un- covered short interest, and with the satis- faction of the need the market for se- curities lacked the stay of this demand. Besides this natural force of reaction from the first rebound there was evl- dence that some of the factors which had been counted on to sustain this re- coyery had turned out disappointing. The most conspicuous of these clements was the decided stiffening of the call money market and the tardiness of the ex- pected relaxation in the money strn gency This ultimate outcome is so cer tainly indicated by all prior experience of money crisis that much of the recent discussion had run to possible measures of relief of future currency imitation and redundancy of money markets, even while New York clearing house banks were at the lowest ratio of reserves to deposits in their history and the clearing house certificates continued to effect set tlement of balances between banks all over the country
 Too Much Haste.
 Last week saw the growth of con viction that too much haste was being made in the anticipation of these abnor- maj conditions.
 Less confidence was felt that the re- sumption of cash payments by the banks and the establishment of the credit situation could be effected before the end of the year. The demand from the interior for currency was not much abated, in spite of the apparent great strength in reserve of interior banks ds- closed by the responses of the comp troller's call.
 The realization was brought home to the financial community that very heavy credit requirements must be met for end of the year, including large mercantile borrowings to insure the continued fioata- ton of business activities. while pre- mature aSSumpllOn WAS being 11ldue III the stock market that the expected re- Aux of funds to normal banking chan nels would be in time to meet these re- auirements, the New York banks action on the evidence that steps were incum- bent upon them to repair their position as d necessary preliminary to the re- establishment of normal conditions in the country.
 Contraction of Loans.
  of this end ran up the weeks money rate and turned prices of securities down. ward. It is a fact, however, that the at- traction of the high money rate has in- duced some lending of interior funds in New York for the first time since the crisis development.
 Another active factor toward checking the rebounding of the plarkets was the question of dividend reduction which was brought forward by the weeks events. The shutting down of a number of the Amalgamated Copper company's mines called attention to the shrnkage in productive output of that industry and emphasized the effect of reports of pro gressive decline in the output.
 Railroad traffic officials gave utterance now moving on old orders little new business is in sight. The distribution of scrip instead of cash dividends by the Western Union and the Atlantic Coast Line opened the field of conjecture of similar results to flow from the trade reaction