Vermont phÅ“nix. [volume] (Brattleboro, Vt.) 1834-1955, 1907-10-25
A Panlcky Week In the New York Stock
Market.

| A Panioky Week In the New York Stock
Market.
There was another sharp and panicky
break in the New York Stock market at
the end of last week. During the closed
period of business over Saturday after
noon and Sunday the clearing house COM
mittee took the situation in hand de-
cisively. The trouble was located in GER
tain banks, control of which had been
secured by reckless or INSCRIPTIONS men
and who had resorted to "pyramidding" g.
the use of one banks stock as collateral
for securing control of another-to an ex-
tent which threatened very serious conse-
quences. The clearing house committee
compelled the retirement of these men,
and the placing of the control of these
banks in the hands of safe and conserva-
tive financiers. and pledged a fund Of
S1OOOO,0O0 to assure the solvency of the
banks. The good effect of this action was
felt when business opened on Monday, the
stock market apparently righted itself,
and 1t was believed that the worst was
over.
But on Tuesday there were new and
unexpected developments and it proved
to be a day of panic in the stock market.
The trouble centered in a run on the
KnlcKerbocker Trust company - the
second largest financial institution in
New York-and the final closing of its
doors For three hours the company
paid out cash 20 its depostors a the rate
Of $44,lH a minutes. 100000 in all. 1t
was declared that the Institution was
solvent, and that it simply lacked the
ready cash to meet the run. The closing
of the doors of the institution was attend
ed with sensational scenes among the de-
positors who crowded the rooms clamor-
ing for their money. During the day the
stock exchange firm of Mayer e Co. fail
ed for S6OOO,OOO. Call money was loaned
during the day at as high a rate as 20
per cent and leading stocks dropped
to new low levels.
on Wednesday there was a run on the
Trust Company of America, but the bank
was able to meet all demands, The gen.
eral situation was rendered more dis-
quleting by news that four OF the
Westinghouse companies in Pittsburg.
Pa, had failed and asked for the appoint
ment Of receivers. The Pittsburg stock
exchange was closed for the day for fear
that wild rumors regarding the Westing
house trouble might extend to other local
corporations and banks.
The situation in New York was relieved
and confidence greatly strengthened dur
ing the day by the action of Mr. Cortel
you. secretary of the treasury, in de-
posting a large amount of government
funds, said to be $40 900, ,OOO in New York
banks, and by sending deposits also to
Pttsburg and other financial centres.
Another important factor in preventing
further decentralization was the formation,
at the instance of j. Pierpont Morgan, of
a committee from the trust companies
similar to the clearing house association,
and the association of many capitalists
with Mr. Morgan in a determination to
extend aid wherever needed by financial
institutions.
Business opened yesterday with the
situation apparently much improved. 1t
was evident that the panicky conditions
were confined to New York and Pitts
burg and that they had been brought
about by the use of great sums of money
for speculative purposes and by an undue
expansion of credit by concerns like the
Westinghouse companies. While there
was renewed liquidation during the day
the market was well supported on the
whole until the closing hours, when a
great volume of forced liquidation caused
a violent drop and stocks reached their
lowest prices of the year, followed by a
sharp rally just before the closing of the
exchange.
The trouble does not extend to the
West. On the contrary reports from Chi
cago, Minneapolis, St. Paul, st. Louis,
banks are sound and strong, and they
are entirely Independent of New York in
their financial resources. The farmers of
the great middle West and Northwest
were never so prosperous, and every
legitimate business industry continues in
a full tide of prosperity. The Boston
Transcript says: "It is probable that as
a stock market panic this one exceeds in
prolongation that of 1898, but in its effect
upon general industry and trade it is as
yet and probably will remain, compare
lively innocuous" The enormous creation
of wealth during the past ten years and
its distribution over a hundred centres,
making the West entirely Independent of
the East, will 1t is believed, render inn
possible the prevalence or continuance of
any such general conditions as prevailed
1898.