The morning journal-courier., 1908-02-24
FINANCIAL REVIEW Drastic Legislation Tends to Maintain Unsettled Con-
 ditions.
BOND SALE A FALSE SIGN
Government Necessities Indicate De- pIetion of Usual Sources of Au-
 tunn Relief.

New York Feb. 23.--Last weeks stock and bond markets were kept un- settled by some. very drastic liquida- ton in special securities which re- suited in acute weakness at those points and aroused considerable appre- hension as to the causes behind thls urgent selling. The general list Of se- curities nevertheless showed good re- sstance to the sympathetic effect of the sources of weakness and reflected the needs of an uncovered bear ae- count which was rebuying stocks pre- viously sold. The character of this buying was pretty clearly revealed in the action of stocks when news un- favorably affecting them. but definite ly predicted, was published. These events were followed by upward move ments in the stocks affected. The general list was inclined to act in the same way with developments in the general situation which was regarded as unfavorabe. This demonstrated an oversold condition of the market. At the same time the course of events was regarded as evidencing check to the movement of contraction in general business and industry, leaving room for estimates of the limits Of the de- pression and various opinions about the future course of affairs. The shift ing movement of securities prices and the contest between differing specula- five forces in the market were an ac- curate index of the conflicting views over the future.
 On the all-important question ot the revival of investment demand for se- curities. some disappointment was felt over the effect of the New York city bond sale, the success of which was regarded as a demonstration of the available supplies of capital for safe investment at attractive rates of re- turn.
 The general bond market neverthe- less. was not stimulated by this show ing and bore witness to the opposing influence of the large inroads on earn ings of corporations, especially the railroads, which have resulted from the contraction in business and indus try. Companies which find themselves confronted with the early maturity or short time obligations put out during the financial stress of last year do not find conditions propitious for floatation of new securities for refunding these obligations, most of which bear a high rate of interest The same difficulty faces companies which embarked on large projects of betterments and ex- tensions dependent, for completion, on the raising of new capital. Some of the points of acute weakness in the weeks market are traceable to these causes.
 Tn the money market some hard ening was perceptble and raised the question whether the limits of the de- cline in interest rates had been reached The New York money market was dl rectly affected to some extent by the progress of payments for the New York city bond subscriptions and by the maturity of subscriptions on seN- eral stock issues coming over from a previous period. Moreover. bank state ments for several weeks past have shown a subsistence of the return flow of cash from the interior into New York bank reserves before 1t reached the plethoric money market condition which was predicted when the reaction from the panic attained full force Bearing on the outlook the state of the government finances has come in foi discussion as they may effect the money market next fall when the usual demand for crop moving purposes sets in The governments necessities arc involved now By the, large current money deficit in the revenues, the ma turity on August l of the 3 per cent Spanish war loan and the maturity lat CT of the temporary certificates put ouJ by the treasury as an emergency meas ure during the financial crisis. Large withdrawals of government deposits from the banks seem to be indicated therefore, and depletion of the usual resources of relief for the autumn money markets.
 All circumstances bearing on tho trade situation are scanned with the closest attention, but. conclusions are considerably confused. News of factory assumptions from some quarters is con trasted with further curtailment in oth- CT quarters. The decline in railroad earnings has brought un the subject pi wage reductions and attention is fo- cussed on the question by the recent letter of President Roosevelt to tho commissioner of labor. The moderate improvement In the demand for steel products has been accompanied by great dullness in all branches of that Industry. The copper market has been a center Of depression.