Omaha daily bee., 1907-04-07
THUNDERER ON WALL STREET
London Times Devotes Editorial DO
the Subject OF some Amer
lean securitins

LONDON, April 6.-(speciaL)- 1.-THE Thun-
derer," the London Times has the follow
Ing 70 say editoriGlly in a leader upon the
subject OF American stocks;
The New York stock exchange has re-
Gently been in a condition Of extraordinary
speculative securities dealt i'm there col
lapsed with a violence which, though not
t ltLIely MituVut precedent, mas not oILen
been equaled during the last twenty-five
years. Probably the majority of men now
in active business, and most OF those who
nave TO chronicle market events, have no
clear recollection Of the fall of prices which
convUlsed the Wall street market IN 1854,
and many have forgotten the year 1898
when the obstinate refusal Of the senate
to repeal the Sherman silver act reduced
the treasury,s stock OF gold to a danger
business community to a degree OF en-
Z barrassment verging on bankruptcy. The
agony, which in some respects is worse
than sharp fall. In May, 1901, there was
a formidable panic, caused by a corner
was soon over, and there WAS no further
trouble until the autumn of 1903 when an
other violent fall took place In neither
Of these two comparatively recent periods
was the fall in prices as severe as that Of
1917. Probably the severity Of the pressure
70 sell was partly due to the fact that the
fall was overdue" Experienced observers
were OF the opinion that the condition of
the American stock markets was n danger
Gus one as tar back as last August. But
as has often been the case the nature Of
tho position was so Obscured by the mar
Vellous activity and highly profitable re-
suits of the industry, agriculture and com
merCe Of the United States. that some very
shrcwd people by no means lacking in ex-
perience were quite convinced that, al
though the commitments of railway kings
ana other large operators were somewhat
grain and cotton, or rather the proceeds
| from their sale abroad would enable those
| commitments TO be quietly liquidated to the
necessary extent. There can be no doubt,
/ however that those who took this favor
able view of the position of the stock mar
kets were consciously or unconsclously as
suming that the general public would sooner
or later become free buyers of a large
proportion Of the "magnates " and the ali
sence of buying Of this kind on a sufficient
scale appears 70 he one of the principal
reasons for the collapse.
At the end of last year we remarked that
| the United States had got through 1906
! without a serious fall in prices The nom
occurrence OF such fall was. certainly
| the late secretary Of the United States
| tree sury, who helped and compelled the ma
/ uonal banks to import gold from Europe
when their reserves We're evidently being
| drained at a rate which would have left
them unable to help the Legitimate" busi-
! replenished. With the commencement of
| the present year it was hoped that more
favorable conditions would come into ex-
istence IN Europe, and especially that the
| Bank Of England would reduce its rate
ana no longer feel imperatively obliged to
discourage Withdrawals of gold to New
! York, The bank. as we know, reduced its
| rate to pcr cent on January II, but in
! tending shippers of gold were made aware
! rather to their surprise that the bank was
| not-ready to allow gold to leave the vaults
| on journey to the United States than
! before, and that If any such operations
were attempted the directors would be re-
| luctantly obliged to revert to 6 per cent.
! We think II probable that this attitude on
! the part of the bank which was thoroughly
] approved I'm the city, was partly due to
| the new and disquietlng Phenomenon Of
| American railway finance-the issue of
enormous quantities of short term notes by
| various railway companies which had found
/ II impossible to issue long term bonds.
! During the first six weeks Of the year
Notes were authorized by various comp anies,
and as the terms on which they were Of
! fered provided a yield of to 61s per cent
to the investor a fair amount Of them were
| actually placed in London and Paris. But
both in Europe and the United States the
| purchase of these notes could only be ef-
fected as rule by means Of a sale of ex-
listing railway securities, and these conse-
quently began to give way when these
vestors. According to some persons en-
titled to an opinion very powerful con-
tributOry cause Of the great fan of prices
| was the cumulative effect of the reVela-
tions as to the methods of Mr.. Il. II. Har-
riman in conducting the business of the
| vast railroad systems under his control,
| and his defiant attitude toward the Inter-
| state Commerce commission. In regard to
the latter, however, he enjoys the more
or less concealed sympathy Of many Ameri-
/ can railroad men who are by no means
pleased at the endeavors Of President
Roosevelt to impose more control over
them.