New-York tribune., 1907-11-11
THE WEEK IN WALL STREET.

Guaranteed protection to trust companies that
had been under pressure was an effective t2ctor
in creating a confident feeling in the
financial community last week, but there was
no disposition on the part of the great con-
trolling powers of the Street to permit the de-
velopment of aggressive bull speculation on
the Stock Exchange. Indeed the hint was
quietly yet impressvely given that any at
tempt to bring about an active market would
be followed by turn in the financial screw
to u point that would cause forced retire.
ment from the Wall Street arena OF trespassers
against the new ruling that speculative opera
tions must for the present time be kept within
narrow bounds. Moreover, 1t was known In
certain houses that further liquidation mad
been advised-in fact, ordered-by the bankers
who came to the rescue OF Il serious situation
the price of assistance to individuals ana
firms over extended in the market. AS con-
sequence of this ruling there was large
amount of selling OF this character, the stocks
sold in many cases representing collateral
against loans and the buyers representing in
terests financially strong enough to protect
their holdings After long hours of careful
examination of trust company accounts after
hours spent in deVising ways and means to
bring order out of chaos and after hours of
planning for harmonious cooperation the lead
ing bankers of this city reached an agreement
by which support of the most effective kind
could be extended TO the money market of the
country. The bankers conference, which went
while the city sleeping, was the most
important factor in the developments of the
last week, and though 1t will require time for
the results of that conference to be fully
fected in financial conditions, favorable be-
ginning has been made and the danger of
widespread panic no longer darkens the finan-
cial horizon. The men who do things at the
right time have come TO the 'front.' as they have
done in the past. and their work will go down
in history of the greatest rescue achieve
ments in the annals of Wall Street.
The financial crisis here has been the pre-
dominating influence in the foreign markets.
European bankers have become alarmed over
the vast Withdrawals of gold from the Bank of
England for American account, the discount
rates of all the foreign banks have been ad-
VanCed and securities in London and at CONT
mental points have declined a consequence
of the pinch IN money. The Bank of England's
minimum rate of discount is now higher than
It has been in thirty four years, and its per-
Centage of reserve to liability is under the
average of the last ten years The Bank of
France has advanced its discount rate to the
highest figure since 1900, the Imperial Bank of
Germany has placed its rate IL per cent
basis and German holders of American securi-
ties have been forced to sell many Of their
securities. The United States has taken moro
than $50,0o0,000 from the British Bank in two
weeks, and in doing has about exhausted it's
credit balance abroad but even with its credit
wiped out. 1t still can draw the yellow metal
from Europe long IL cares TO pay the
price. It IS believed, however that the urgent
necessity for gold imports no longer exists and
1t is not unlikely the movement will end in the
current week. The best interests of the inter-
national financial situation would be served by
a cessation of the American demand for gold,
especially Europe is still a large holder OF
American securities which must inevitably come
upon the local market If our bankers continue
TO bid for foreign money. New York is help
ing the interior by generous shipments Of cur
rency and talk by poorly informed people that
this city is holding back balances of out OF
town institutions is not well founded Every
~ tC hnfT
the needs OF the country at large the Secrc-
tary of the Treasury is making further deposits
of government funds with Western banks and
conservative men urging frightened de-
positors to return to fiscal institutions money
recklessly withdrawn There undoubtedly soon
will be a scramble on the part of depositors to
redeposit their funds, the boarding Of money
viii come to an end and the premium on cur
rency will disappear.
Financial disturbance, which is rapidly disap-
pearng, doubtless will impress upon the minds
Of our legislators the necessity of some sort Of
currency reform which in the future will pre-
vent the development Of conditions similar to
those which have in the last few weeks brought
so much trouble to this country. An asset cur
rency plan which will supply notes when they
are needed and drive them back to the federal
treasury when the necessity for their use no
longer exists is sound in principle and will be
found to be sound in practice and the indca-
tions are Congress will be asked to approve a.
a
currency for emergencies. but not for initiation
Moreover 1t is not improbable the banks will
devise some system by which a distinction will
be made between cash deposits and check de-
posts, based on gold redemption and so organ
lied as to prevent a dangerous imitation OF
credit. The upheaval of the recent past has
served the useful purpose OF bringing to light
many giaring defects Of our currency and bank
ing systems, and though the cost has been Heavy
and has been felt in all parts Of the country IL
VIII result in the development Of new conditions
and methods Of banking that will strengthen the
general financial situation The report from,
Washington that the federal authorities ara In
Vestigating the operations of certain "overnight''
hnancIers is an encouraging sign of tho times
and II 1t is found the banking laws Of the
United States have been violated the whole
country will rejoice In the conviction and pun
ishnent OF the guilty persons Shady fnancier-
Ing In some quarters, disclosures of graft on the
part Of high flnancers" and constant disreuard
Of the law by certain corporations have hurt con-
hdence among the people, and the efforts Of the
President 10 correct such abuses furnishes a
poor argument for the interests who are Dro-
claiming from the house tops that credit has
been injured because the administration has
opened the doors for official investigation IF a
halt had not been called by President Roosevelt
eventually there would have been panic that
would have involved. in far more serous w,av
than did the current troubles of tho last Jew
weeks. every city and hamlet in the United
States
The purchase of the control Of the Tennessee
Coal and Iron Company by the United States
Steel Corporation. which was effected last week
was one Of the favorable developments that
served to strengthen the Wall Street situation
1t was also a highly favorable DEVELOPMENT for
the United States Steel Corporation and for
the iron and steel industry of the South Excel
Of he TVrs+