New-York tribune., 1908-11-12
FINANCIAL AFFAIRS
PROFIT. SALES IN STOCKS.
Heauy Declines FoIlo5ced by Rallies
-Regular Hartman DiUdends.


yesterdays market, their transactions repre-
senting q desire TO take profits rather than a
belief on their part that the bull movement had
run its course These sales naturally attracted
heavy liquidation by small spectators who es-
tablished long accounts the day after election,
while attracting buying by interests who
believe that on all reactions stocks are good
purchase On the advance in Tuesdays mar
bet short contracts were put out by professional
traders who figured upon a decline, and the
weakness Yesterday. which extended from 10
; points in the leading issues. afforded this
class of operators an opportunity to cover their
contracts at a profit Speculative considera-
tions and technical conditions were responsible
for the liqudating movement, but as something
more thar such factors always is required ny
commission houses for explanation of the
course of the market, disappointment because
the Hartman directors did not increase divl-
dends was advanced as an excellent reason for
the decline As q matter Of fact, no regular
follower Of the Street had any idea that there
would be any change in the rates paid on South
en- and Union Pacific. In the last hour the
general market showed d stronger tendency,
many issues recovering point or more from
the low figures Of the day. while at the close
there were nearly as many net gains as ad
vances in the leading shares. Union Pacific
made e low price of 177A. but closed at 179l4.
2 net loss Of / q; Southern Pacific lost / 3 on
the day. though ending a UP from the low
The Erie shares were strong features; also
Colorado Southern Missouri, Kansas & Texas,
Chesapeake & Ohio and Tennessee Copper. the
last named exhibiting unusual activity based
on the Improvement in the copper trade. Stocks
recovered easily, and the early declines were not
extensive in view of the advance since the cleo
ton Foreign houses went home long OF the
market
II is contended in many quarters that the ad-
vance which has taken place in stock market
values from the low points of the panic of
year ago has fully measured the Improvement
that has been recorded in financial and business
conditions and has discounted in addition the
expansion that will be enjoyed by our industries
in the next twelve months The advance, of
course in actual market points has been enor
nous but IL should be borne in mind that this
appreciation started from level which was far
under anything warranted by the upheaval OF
October 1907 and that with the exception of
few special issues current quotations not
high in comparison with the price of money and
the interest return on stock investments It is
said by some that the advance in Union Pacific,
for instance. has been so heavy that the issue
is now selling dangerous level This may
be true just at the moment for spectators who
buy on small margins. but there is nothing dan
gerous about the stocks current quotation for
investors whose only regret may be that they
were not wise enough to buy the security when
it was selling at panic figures. Union Pacific
sold down to par last year, but the company
continued 10 pay 10 per cent and solid 10
per cent issue il is difficult to figure out that its
rise from 100 TO 1s0 has been out of proportion
10 the intrinsic worth of the investment. TAX
ing the entire list of stock investment securi-
ties, the same thing applies almost without
ception. The sensitive mechanism OF specula-
ton becomes weakened when operations for any
length of time on one side Of the market.
and as d consequence sharp declines with a
adjustment Of prices to a temporary lower
basis must be looked for in the future. but
careful analysis OF conditions affecting the real
value Of investments al present ends in only one
conclusion, and that is ultimate higher range
OF quotations.
The point is well taken by many observers
that the recent advance in prices has been too
fast. Technical conditions have been weakened
and material reactions may be looked for but
factors underlying investment movements are
growing stronger, pointing TO the establishment
of values p higher plane. barring the devel-
opment Of a radical change in the country's in
dustries finances and politics. II looks If
the operator who goes short of stocks for a long
pull would suffer big losses. Money is cheap
the world over, and accompanying an increased
demand for accommodation from mercantile
and investment sources there will be a
stant addition the worlds supply Of money
from expanding gold production Speculation