The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1907-03-25
HUGE SPECULATIVE HI
MOVEMENT BREAKS l:|l ( " 4
Public Keeps Out OF Market and
~ Securities Could Not BE
Sold
large HOLDERS CAUGHT
Improvement Looked for in
Money Conditions After
Middle of April.

Middle of April. i
/ NEW YORK, March a. Last weeks
on tho Stock Exchange left
the stock market In an unsettled and
reverish condition. That disaster was
partly THE result of economic condl-
tions and partly the result of break
nugurnted In the last quarter OF 1906.
The large dividend payments on Union
anu Southern Pacific, which excited
so much comment at the time. were the
basis OF extraordinary speculative
operations conducted simultaneously In
London and New York. The parties
these operations were high
lyt successful In their earliest stages;
and large quantities of these stocks
bought at low prices were profitably
distributed during the first part Of the
campaign in both the domestic and
foreign markets. subsequently. how
ever, these operations were not entire
sly successful, because large amounts
OF stocks were Still held by the leaders
and their friends for which only very
limited market could be found outside
OF their own buying and selling to
each other. The public as a whole had
kept out OF the market with unusual |
pcrsistency; the widespread dstrust
created by the exposures OF high finance
=
questlonably the chief causes Of this
sreticence. The strain on the leaders |
was intense and was seriously agra
waited by high rates for money. The
pressure OF the railroads for new cap
ital and the tremendous outpouring OF
short term notes after January 1st
proved to be the last straw. In a sit
uation Of such tension only a moderate
shock of some sort was necessary to
precipitataE g. collapse.
Such n a shock came ostensibly
through the rising hostility Of State
Legislatures towards the railroads.
Railroad managers and the heads Of
large corporations became seriously
alarmed at this aggressive attitude.
| For this they had themselves chiefly
TO blame, owing to past misdeeds and
d prolonged disregard of public opin-
4 ion. with confidence in the stability
I of values weakened--hrst. by fear Of
|, natural reaction. and 4 second by fear
Of political retribution-a situation was
1 created that readily plains the re-
! markable collapse which occurred a
/ week ago. 81.
4 Large Holders Lose.
AS a resultsof that decline some Very
serious. losses have been incurred by
large holders Of securities Fortunate
4 ", the public have suffered to a very
4 much less extent THIN usual; hence,
the remarkable absence of failures.
4 Such debncle cannot, however, DO
experienced without iexerting more
or less depressing effect. a temporary
rally. of course, followed. due to p1r-
chases of those who bought for invest
ment or to support the market; hut
'7the latter stocks were soon fed out
I lin order to take profits, thus leaving
the tone feverish and unsettled After
such debauch the market Is likely
TO show more or less inertia and posi-.
bly, settle down to a still lower leve;
Confidence has been rudely shaken, anf
!. only time can make amends. a goot
1 many operators have been seriously
crippled, Added to this Is the un
+ 'sa tisfactory condition OF the world'
Z money market. The advance OF tn,
rate of the Bank of France from &
{ Ito 3 la per cent. Is highly Significant
n This is tho first time q change ha
Z been made in the rate for seven years
{ and is plain notice to, London, Berlil
land New York that Paris will first ia k
care OF itself and that those in nee
2 may have to look elsewhere for as
3 distance. Our own flnanciers hav
4 placed more or less dependence eA .t'1a upo
tsl help from that quarter In case o
" necessity; and no doubt German,
x which is already suffering from over
w doing inSflnancial and Industrial circle
Y / has been]a Knocking at the doors {
y Parisiar, bankers. We are also clos
!? upon the first OF April, a period whe
X the money market usually. suffers MOI
III or less arrangement This is advers
to the stock market. After the midd
u Of April funds should begin to retul
4 from the interior and facilitate tt
q building up of local reserve. Recel
4 liquidation and the establishment
81 stock market values upon a III muc
II lower level8 ought also to serve t. r
1s lieve the monetary situation. Aft
7, a period ofTrest and an impraveme
= In. the monetary outlook. which ca
4 not DO much longer delayed. the
IS should be fair chance for a recove
- in the market during the spring; pr
~ i vided, however, no further disnste
ore incurred during the interval,
Improvement After April.
x tits too carly to calculate the effe
IL upon. general business of the sto
1 market decline. Our, railroads are {
,33 ready starting policy OF retrenc
IIU ment which must react upon tho II
3h trade and upon labor
n Many of our rich men who arc {
customed to take the initiative W
~ either through necessity or cauti
II follow on the same lines, With
~ check to enterprise generally and
21A lessened demand for labor. itais
T. evitable that business will In time +
M these movements. They may not sh
nj themselves Immediately for much OF
work. projected must be finished
-. later on it need cause no surprise
The there shoull ~ - 800 n,,in,, = !,
~, ~ mess has been going for the past I
az Years. II such reaction can be k
he within moderate bounds and the COZ
ln- 4 .-..--. -
aEYn II = CT ~, ~ 4. "A (. s,s, y
"a ~ f6Al I'M
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