The Marion daily mirror. (Marion, Ohio) 1892-1912, 1907-12-02

distinctly better feeling In the nm |
ancial situation due almost entire
ly to Improvement in the money |
market which has been working out
its own cure. Iioarded currency is
being returned; foreign gold Isl
pouring into our Golfers; bank re-
serves are beginning to rise; the
credit situation is less strained
call and time money rates are
lower, and redemption OF Clearing
House certificates is already in
sight. These symptoms OF relief
have fortunately shown themselves
even before the additional currency
furnished by the Government had
become available. They show nat
ural and healthy tendencies toward
recovery. AS "a result we have +
fair rise In the stock market and
confidence has been correspondingly
improved. 1t Is quite evident that
the corner has now been turned,
and that liquidation in the main
is completes. Possibly further weak
spots may develop later on, but
these promise to be of minor i'm
portance. After enormous shrink
age and liquidation of the past few
months. the market is evidently on
safer and sounder basis than IL
has been for long period. and
as soon as the monetary situation
rights itself and confidence is
more fully restored. values should
go back to n more normal level.
1t is not pretended that the mar
ket will promptly or wholly re-
cover from the terrific shock which
1t received in October last For
some time to come irregular mar
kets must be expected with more
or less depression and inertia. 1t
must also be remembered that
there is comparatively little money
available for Investment. The
country s 'liquid capital has been
practically exhausted so that time
Will be required for the accumu-
lation of fresh supply; and in
, view of the reactionary tendencies
which have developed in business,
1t is quite probable that longer
period than usual will be required
for saving purposes. Another fac
tor which must not be overlooked
i is that in spite of the large volume
OF business profits are showing a
material shrinkage, owing to the
immensely augmented cost OF doing
business. This is strikingly illus
trated in the current returns Of
railroad earnings. In September the
roads reporting showed gain OF
over $13,00O,OOO in gross earnings
while net earnings showed loss
of S3,60O,0O0. During the nine
months ending September there
was an increase OF $156, 100000 in
gross earnings accompanied by an
increase of only $l5,OOO,OOO in net
earnings. This is an almost start
ling diminution of railroad profits
especially when IT is considered
that gross earnings are making
less and less satisfactory returns.
while the increases OF expenses are
still abnormal. No doubt the rail-
roads will soon be compelled to
make every possible economy IN
Operations. Many improvements and
extensions have already been post
poned, and II is serious question
in the minds of conservative mana
gers whether 1t will be either pos
sible or good policy to maintain the
high rates of dividends which have
recently been paid especially in
view of the very low prices at
which many excellent stocks are
selling
Il Now that the panic is over and
a sober view is taken of current
events, the question constantly
asked: What caused the crash? The
answer is necessarily difficult one,
because the causes were many and
complex. The main reason. how
I ever, has been that OF general over
, doing. Credit was overextended
, speculation was excessive and ILL
advised; expansion OF every sort
. was being carried TO excess by over
confidence, until finally the coun-
try's floating capital was practical
, ly exhausted through being turned
. too rapidly from liquid into fixed
forms We have only to glance al
the demands upon new capital
, during the past year or two ia
: realize this fact During the first
ten months OF the current year. the
amount of new Securities authoriz-
ed amounted to over $1.75O, ,OO0,.
600, OF which at least 81 .OOO. .OOO,.
600 was actually issued. These
ngures simply lnciude ra,iroau a,In
industrial securities and notes. the
great bulk OF which was offered
previous 1toa September first. The
year 1906 was also a period OF
exceptionally heavy issue. the to.
tai then being Si,6OO.OOO,OOO au,
IthnriZp6 and nj 0AA nno nof, tso.. n a