Omaha daily bee., 1907-01-17
NEW YORR STOCKSANDBONDS
Demands Of Railroads for New Capital
Causes Heavy Liquidation.
LEADING ISSUES SELL OFF RAPIDLY
slump fastened by RumOrs that
Earnings VIII he Used for Inn
prOvements-RaIIy Near
the Close.

NEW YORK, Jan. 16.-There was heavy
liquidation Of stocks on the stock market
today, due to the constant extension OF the
demand for more capital by the railroad
companies. The most conspicuous phase of
the situation developed today was the SEEM
ing intimation of the need of the resources
In hand, for the work of the railroads
might bring about a check to the disburse-
n ent OF profts to stockholders in the case
of some companies. This suggestion proved
especially influential to speculative senu-
ment towards the low priced railroad stocks.
Companies whose securities are In this class
are at a natural disadvantage in raising
new capital, owing to the heavy discount
which must be allowed for the sale of Sc
onrities with margin of net earnings so
narrow as to reduce the security for the
payment of fixed charges. Published re-
marks on the subject Of capital require
ments by President Thomas OF the Lehigh
Valley and President Finley of the South
ern railway, were interpreted as threaten
ing necessity of greater outlay OF earn
ings In improvements owing to the diff
Tho first effect Of this new element In the
situation was most acute on the Morgan
group Of stocks. The Southern railway
stocks broke violently and the preferred
stock especially seemed to lack any bids
for offerings pressed to sale. The remarks
OF the two railroad presidents referred to
were accepted also In a wider sense as en-
forcing the universal requirement of the
railroad industry for great additional out
lay Of capital In the face of heavy growth
in the cost of material and labor. The feel
ing was revived in full force which per-
vaded the market when the Pennsylvania
stock issue was first announced, that es-
Inmates hitherto presented of the capital
needs of the railroad corporations had been
grossly miscalculated Erie was the earlier
stock to show close sympathy with the
slump In Southern railway, the rest Of the
market being disposed for a time to ignore
the movement. The first spread of the
movement was to other low priced stocks
difficulty In raising capital. The growing
weakness of the market was due very
generally to the consideration of the same
topic from different points of view
The strength which has been shown re-
Gently In copper stocks on the talk of a
merger of important Michigan properties
gave way to sudden weakness in Amalga-
mated Copper, when the suggestion found
utterance that new issue of that stock
might be involved in the supposed merger.
The vulnerable condition of the market In
vlted aggressive tactics by the bears and
they operated with great holiness and on
large scale. This was manifest In the
rumors which circulated and which met
with authoritative denials and also in the
the times when the liquidation spent its
force. The forces of replenishment of money
supplies continued to operate and the call
money market showed positive ease at 4
per cent and below. Funds are reported to
he flowing to New York from the interior
in large volume and sub-treasury operations
have yielded to the banks this week $7,1O9,
900. Discounts in London yielded again and
the impression was strengthened that the
Band Of England discount rate will be low
cred tomorrow. Sterling exchange at Paris.
however, broke sharply The Continuation
of the LIQUIDATION caused stocks to sell at
| the lowest of the day in the final half hour,
but the demand from uncovered shorts
caused a substantial rally, which was held
| to the closing
Bonds were irregular. Final sales par
value, 100000 United States bonds were
| unchanged on call
Sales and range of prices on the New
York Stock exchange We're: