The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1907-02-20
STOCKS LOSE GAINS
Half of Advance Made This
Month Is Wiped Out.
MARKET BADLY HAMMERED
Declines Not Regarded Due to Heavy
Pennsylvania Loan or Sensational
RumorS Circulated, hut to OppOr-
tune Onslaught by Daring SDecuIa-
tOrs-GrOunds for Uneasiness.

fOFS-UE0UnGs Tor tmeasiaSSs-
New York Feb. ia selling movement
set on in the security market to-day
which at one time brought quotations
for the active stocks to a level at which
nearly half Of the entire gain on prices
made in the course Of the present month
far as could be learned. by any develop
was lost. and the peculiar feature of the
decline was that it was unprOvoked so
ment Of a sort that would be ordinarily
considered as a sufficient cause for such
an event.
There was no abatement in the decidedly
more optimistic attitude toward the
American market recently exhibited in
England and on the continent of Europe,
and there were no occurrences in the for
eign markets of a kind that resulted in
sales Of stocks here for European account.
On the contrary. foreign houses were
buyers on moderate scale, as they have
been for more than week past. There
was no change during the day of any
Importance in money rates. Time money
has recently shown greater firmness than
il did a fortnight ago but this has been
displayed more in a somewhat greater
reluctance Of lenders to put out their
money at ruling rates, than i'm any par
ucular advance in the rates themselves,
and has been caused, undoubtedly by the
temporary influence of the Withdrawals OF
money from the local money market UNI
der the governments call for the return
OF So. 600 special deposit fund.
Liquidation Is Heavy.
So far as call money was concerned.
bank renewals of loans of this character
to-day We're made at lower figures than
they We're yesterday. The liquidation in
the market, that was carried on almost
continuously from the opening of the
stock exchange session until well after
midday. was By many ascribed TO the
prevailing belief which became a certain
~ late in the day, that the Pennsylvania
Railroad Cmpany proposed to make a
large issue Of short term notes, but Just
why this should have induced throwing
over of speculative holdings for the rise
was not at all clear It has, Of course.
long been obvious that i'm the present
state Of the bond and stock markets the
Pennsylvania Railroad could not sell to
advantage either the new bonds or The
stock whose issue viii presumably be
authorized by the shareholders of the
company at their annual meeting next
month. and that. in order 20 meet its
financial necessities recourse must be had
10 other money-raising plans.
The mere fact. therefore, that the Penn
sylyania Company had finally decided to-
sell short-term notes instead of issuing
stocks or bonds, hardly could have de-
moralized the stock market. Indeed.
Pennsylvania stock to-day made "a smaller
net decline than almost any other leading
issue. and when the news of the sale Of
notes was officially made public it was
accompanied with the declaration that It
marked the end of any new financing by
the Pennsylvania management in the
present year; the Inevitable inference
from this statement being that the Penn
sylvania management proposes TO follow
the example Of other large railway COM
panies and heavily curtail its proposed
expenditures in the near future
RumOr About the Equitable.
Coupled with this matter to-day were
Iumors, which. in most instances were
doubtless without foundation. of further
proposed sales of short-term notes by "a
number of railroad companies that have
hitherto been excluded from the list of
probable borrowers. OF all these tales
the only definite fact was that a sale ol
shOrt-term notes had been made al a
very high interest bearing rate by the
so-callcd Tidewater Railroad Company of
Virginia, "a new railroad, running through
the bituminous coal fields of Virginia and
West Virginia. that has been constructed
so far through almost unaided personal
efforts of a wealthy capitalist.
Finally stories of a most absurd charac-
ter were heard concerning various mat
tiers affecting the Equitable Life Assur-
ance Society. over two weeks ago a de-
cision was handed down by the United
States Circuit Court of Appeals reversing
the decision Of the lower court. which in
turn had upheld a demurrer interposed by
the Equitable Society TO suit brought
by policy holder of the company. ask
ing for tie appointment of a receiver for
the company, and the distribution of d
part of the Equitable surplus The high
CT courts have Overruled the demurrer
the case must row be proceeded with on
its merits, and upon this to-day was
based the TumOr that "a receiver for the
Equitable had actually been appointed
The case, of course, involves in no way
the sOlvency of the company and is con-
sideved of trivial Importance by the
Equitable management. Ii can hardly
be supposed that the matter figures in
any large way at all in the break in the
stock market that occurred.
Work of Daring Spectators.
The consensus among the best informed
people was. therefore. after the close of
business to-day, that the weakness of the
market was due simply to an onslaught
upon values Of an unusually aggressive
and daring character by spectators for
the fail: and this was measurably borne
out by various observations made on the
floor of the stock exchange. The selling
was concentrated in the hands Of half
dozen brokers, all of whom played a
prominent part in the attacks upon the
market during the month of January. one
of these brokers to-day sold. Il was est-
mated, over 5000 shares OF stock II is.
of course, Undeniable that prices of stocks
are cOntending for the time being against
many adverse factors. No doubt the
stock market has TO meet ut the present
time what may be called the competition
of the railway short term note borrow |
ings The popular agitation against rail- |
road interest win, it seems, at least be |
successful in bringing about in the pres
ent year. unless restraints are imposed /
by the courts. a rather uniform rate of > /
cents a mile for railway passenger fare |
and while this may serve to increase the |
volume of passenger travel to some ex- |
tent, it must not cut seriously into rail- |
way revenues.
II is certain TOO that fear acfualIv i