Los Angeles herald., 1907-11-18
CLEARING
WRECKAGE
UNpERToNE OF CONFIDENCE IN
MARKET
Buying In Small Lots on the Increase.
Small Investors Important Factor
in Bringing Return Of
Normal
BY Associated / res,.

| ny ASSoCldteu L EebS.
NEW YORK, Nov, 17.-Affairs in the
financial center itself moved toward ac-
! justment last week and in the stock
market there was an unoertone of conf
dence on this account. even while the sur
| face of the market was more or less dis
turbed by after effects of the recent vio.
| lent perturba tion.
As is invariably the case of such an ex-
perience, there remains certain amount
of wreckage to be cleared away. The
mere fact that this work has gone on is
| in itself evidence of the conviction thai
conditions are more propitious for making
| 1t successful until great banking interests
and capitalists with a near interest in in
Gividual properties take offerings of them
in the market in times of panic for the
purpose of opposing obstacles to the dis
astrous break in prices.
| Such purchases come back on the
market for sale at the first opportunity.
| Accounts with commission houses also
are carried through times of peril with
the understanding that they are to be re-
duced as soon as can be done without
entire sacrifice.
During the late upheaval also it is we'll
| known that accounts were taken over
! from embarrassed concerns bodily III
order to save them from wreck, and it is
| believed the past week has seen the
! clearing up of some of this by resale Of
securities in the market.
With the subsistence of the price level
back to an attractive basis under these
| operations, there has developed again in
vestment demand in small lots which is
| so notable feature of the present situa-
tion in the securities market.
For agents of all the great corporations
| are working overtime in recording the
| holdings of new stockholders in small los.
This kind of buying forms in the agg1'e-
| gate more important factor of absorp-
| tlon and distribution than the mucn
larger transactions of the ordinary deal
;ngs on margins which are taken with the
mere purpose of resale at a profit, which
are held with borrowed money and are
vulnerable therefore and liable TO be
forced on a weak market at most un-
propitious time.
Encourage Small investments
With the decline in the rates for monev
on call there has been a stirring of activ-
| ity also in this class of operations, but 1t
has been frowned upon by bankers and
money lenders and by the leading minds
bent on the remedial measures from whicn
are hoped the restoration of normal con
ditions at an early date
| The small investment buying, which Is
thus encouraged, is in itself an important
remedial measure bringing out sums of
|
the channels of banking operations. and
are thus restored to do the work of re
| habiltation.
On the side of the general situation the
stock market has had to face some con-
sequences of the late upheaval, which
| conform to the expectation indicated in
| the conclusive readjustment of prices of
| securities effected earlier 1t was early
| foreseen that the dislocation of the ms
ohinery of the financial and commercial
| exchanges would have the effect of throw
| ing obstacles in the way of maintaining
business activity at it's high level. Re-
| duction of output, cutting down of work
ing forces, cancellation of contracts, fall
in prices of commodities and retrench-
ment in all forms, together with restric-
! ton of orders for future delivery, which
from the burden of incoming reports, oc-
casion no surprise to speculative senti-
| ment which is registered earliest and
most accurately in the securities market
These developments had found their re-
Election in the earlier events in thai
medium. The present market is inclined
Ito reflect rather the opinions of the future
Duration Short
The action of the market may be fairly
interpreted as offering a good proposito1
OF hopefulness for a short duration of tbs
crisis, and for an early restoration OF
nOrmdl COnulllOilS anu d ASiSWSH SN~-
toward the revival of the prosperous
activities in which the country was pre-
viously engaged Confidence is felt In the
solid basis OF that prosperity, and 1t is
believed the experience through which
the country is passing contains in itself
the forces of correction of the conditions
which were placing a limit on that pros
perity.
! A lower price level for materials is a
conspicuous example of the line upon
which this needed readjustment is now
working. The lower prices of securities
! also is having the effect of attracting
capital not only from domestic but from
foreign sources, thus unlocking a force of
replenishment, the lack of which had
come to be the leading factor in bringing
the course of progress to a standstill.