New-York tribune., 1908-06-01
THE FINANCIAL MARKETS
1RBEG1rLARrTY MARKS THE COURSE OF SECOhl-
TIES TRADING.
Ru Increment Apparently Over for the PesentMony May Dc
Firmey-Break in Trade Sagnaion
THE WEEK IN WALL STREET

,ia.;,, days when the general course OF spec
,,,.+,on suggested the development in the near
,u,ure of narrow trading and small price nuc'u-
ations The market needs resi- roi III
months until May 1s it moved steaohs ~"
higher level in the face of an unusual numoer
~ adverse conditions, the advance peiiis az
COMMANDED by expansion in dealings that I'D ai,e
IT, two weeks of the bull campaign gave mill
a., ,.-e onsrations almost daily. On May lS
.ha rice WAS checked by the markets own top
beaviness and since that time violent oeciiiieS
have taken place. with occasional recoVeries' o
at no time following the collapse OF tne up"u
movement has there been any lnolca'ioii '.i
speculation is to revert TO the posiuoh i
and encouraged by a few resource1ul caph'a
1t is quite evident that the big wave VI Sp
lation has spent its force, and that oafrliis u
veIopments of vital importance Dearihs upO
the financial and industrial SITUATION pe
of idle markets is about to begin. Inc app
~ .be active political campaign, the uncertainty
oxer tbe outcome of the years harVests ano tiie
unfavorable conditions in the business "oriu
ore No, the sort of factors that warrant FURIOUS
.,ecula,ion IN securities, but irrespective oi
.hase considerations the market is entltled u
renose owing 10 the strenuous days ufoush
which 1t recently has labored- Inc ~ eliiia'o
of manipulation for higher prices ana 'iie
.trenneut from the speculative helo oi INC e
men of money who have been respoii'i N
t,e Improvement in values In the last thiee
months will not injure the future OF the ii,alhe.'
indeed If the market is allowed to take a nhuch
needed rest it will be intrinsicaliy souhder ia'ei
in the year.
Naturalization that merely represents the ue-
termination of certain interests to carry prices
TO a higher level for the general good OF the
situation may be classed a public service
and n should not be confounded with manfpula-
.ion that is based on trickery ana unscrupuious
methods But manipulation, no matter upon
what high ideals it may be founded, can loI
any length of time run contrary TO economic
laws The recent manipulation made a sooo
start and carried the thoughts OF the hnancia!
and business community out of the sioush OF
dependency. subsequently, however, ruhHihs
too much In advance of actual conditions ana
then cola apsing because of the absence OF pup
lie support The back of the recent Dull
operations carried their discounting process en-
tirely too far, but they deserve some credlr
however for bringing cheer to investors VINO
are now in a wonderfully improved condition OF
mind as the result of the appreciation that has
taken place in securities values. Moreover, the
higher quotations for stocks and bonds have
loosened the purse strings of capital A good
market has been created for good rallroau
bonds and as consequence the transportation
cornpanies will be able to resume on con-
servative scale extensions and improvements
that were checked by the panic last fall Ihe
demand from the railroads for labor and sup
plies will be a important factor in bringing
about better conditions in trade circles, and II
is quite likely that within the course of the
next few months a material change will be
noted in the general business situation as a
result of construction operations by the rail-
ways II should not be assumed, however, that
the country will throw off Immediately the de-
preston now noted in business circles Recov-
cry will be slow. particularly as political dis
cussions will tend TO induce extreme caution
in industrial circles. 1t is We'll to note, never
theless, that there has been break in the stag
nation long current, this being especially
marked in the iron trade.
The Chicago, Burlington & Quincy bonds Of
fered 10 the public last week were quickly taken
by investors as were also the notes of the Tide
water Railroad. Bond brokers reported mate
rial Improvement in the demand for railroad
MORTGAGE issues, and they considered this in
quiry of the most encouraging signs OF a
return of confidence in financial and industrial
conditions in the United States. And bankers
in general were not disconcerted over the heavy
sales of stocks by people who bought in the
panic market by the liquidation of American
securities for European account These opera
tions as rule based entirely on the attrac-
tive profits that could be realized and not upon
any uneasineSs in investment circles. A tre-
mendous amount of stock bought last fall
in odd lots, a good part OF which recently has
come upon the market, thereby increasing TO
large extent the floating supply and making
The public took stocks from Wall Street in the
panic at cheap figures, and resold them to Wall
Street at substantial advances, an operation
quite unusual in the history Of speculative
markets. OF course, there were many commits
sion house operators who were badly damaged
In the last week as a consequence of declining
values. but the proportion of public purchases
at the high points of the season and of sales
| at a loss light in comparison with bull
markets of the past.
! ri,,,e slight in wool
rejecting disposition the part of the lend
| ing institutions hold their funds for higher
rates, the expectation of higher level being
! based on government Withdrawals from the
| banks and gold exports. The government
doubtless Will be compelled to recall further
amounts of Treasury deposits from the national
banks gold exports may continue for time
! and the demands for accommodation from mer-
camille sources may increase to material
extent-factors which will tend to increase. the
price of money, which is an Improbable
/ level for lenders. Government revenues con-
| tinue TO fall behind expenditures, and at the
current rate of daily deficit the excess of ex-
penditures over receipts for the fiscal year will
/ exceed $4,000, 600. The Treasury has work.
/ ing balance of about s62,00000O, and as govern
! ment expenditures Will not decrease for many
weeks, while there is chance of much i'm
| provement in income in the future, Seer
| tary Cortelyou doubtless will be compelled to
ask national banks to surrender Treasury funds
TO the extent of at least $4,000, 600, which would
still leave in depositary institutions more than
s126, 100000 government money In August the
/ Spanish war loan bonds fall due. and if they
are redeemed further call will be made upon
the banks. Though the surplus of the city
| banks is heavy, there is no reason to suppose
that the present plethora Of funds will prevail
| for any great length OF time. And there is also
no reason TO think that higher rates for money
Will foreshadow a financial panic, as some of the
lawmakers in Congress evidently suppose.