The Birmingham age-herald., 1907-11-03

LII tue pldy. Ine DdnkluS Interest VIII discourage any great enlargement of speculation, but they will not be able to keep it entirely suppressed. In fact l they will not want to, for it is on the l minor advances that they work out of stocks and bonds with which they are loaded by delinquent and sorely pressed borrowers.
 The stern prohibition on marginal trad | ing in stocks was a necessary move. At the same time it was a serious embar- | rassment and might be described as sword that cut both ways. 1t was sum- mary notice that no funds could be had for speculation and at the same time it deprived the stock market of support that was badly needed. Hence the embargo on marginal operations was lifted as soon as possible and call money once more placed within the reach of traders anxious to avail themselves of the opportunity to profit by the recovery In prices, which everybody believed would follow the first substantial return of confidence.
 The indications are that capital will be forthcoming to finance moderate specu- laton in stocks, but as before stated anything that looks like wide extension of dealings will be drowned upon and checked. Hence 1t is that disappointment is likely to be the lot of those who an- ticipate a perpendicular advance in prices on anything like the same scale that marked the decline. This is one of the times when the banking element will have the power and disposition to control the broad action of the stock market.
 The acute grief which overlook the money market not only in New York, but the whole country may make for quicker and more permanent general re- covery to normal conditions in the busi- ness world than would otherwise have been the case. For one thing it gives corporations and business establishments of every 4ind full excuse for the imme- diate inauguration of economies planned for. but put off on one account or an- other.
 The imposslbility of getting money has been so forced upon the attention of business men generally that they have no other resource than to shorten sail and do it at once. The cutting down of expenses in every quarter has already commenced and it will become more and more the fashion as winter advances. Workmen by the tens of thousands have already been laid off by the rail- roads all of which make the blunt ex- planation that conditions of the money market compel this action.
 Manufacturing concerns are following a similar policy and from every city and manufacturing town in the country is heard the same story of tight money and compulsory contraction of activity. l have referred to the preliminary warn- ings of this condition several times in my dispatches within the last three or four months. For the most part mention of the danger signals appeared to be de- cdedly unwelcome and wer occasionally eliminated, as evil prophecy readers would , not care to see, as though anybody could be hurt by fore-knowledge of bad things to occur or could be injured by conformation of unpleasant facts No- body has ever yet been helped by willful self-deception.
 To all who may be cast down by recent caamitous events there will be pleas ure in the thought that the country is very likely to be spared the inhction of long continued business depression. such as the people suffered from during the hard times beginning in 1873 and 1893. The situation now is entirely different from what it was on both of the occa- sions mentioned. The long and desperate panic of 1S73-7S was the direct sequel Of the war and the extravagant speculation following 1t. The currency system was chaotic and business conditions every where unstable and unsatisfactory. The same was true in lesser degree in 1S93-96 Now we are on sound currency basis with money standard firm as the Rock of Ages The country is enormously richer than ever before and as a nation we are in condition to re-establish our business equilibrium on short notice. For the last six or eight months every cor poration of consequence and men of af- fairs singly and in concert have been paying off their debts as fast as they could. This policy actively pursued as it must be will put an entirely different complexion on the general business condi- tions within a year.
 The opinion is very freely expressed ] among men of sound judgment and wide i exnerience that the duration of the im- !