New-York tribune., 1908-04-06
THE FINANCIAL MARKETS
DOUNWARD TENDENCY IN STOCKS WITH THE ERIE
NOTE Compile ALTON THE CHIEF INFLUENCE.
Gradual I'm proremen
Money Market.
THE WEEK IN WALL STREET.


The stock market has been a fuctuating one
| during the last week, with a generally declining
| price tendency, the net losses in the leading
| speculative issues however, not exceeding 10
| points each. The predominant market in
fiuence was the uncertainty concerning the fate
of the Erie Railroad Company, uncertainty
which prevailed up to the close Saturday, the
directors having maintained a policy of strict
| secrecy regarding the progress of their deibera-
tons and negotiations looking to the provision
which must be made for the s5.500000 notes ma
turing "Wednesday of this week Late on
Saturday afternoon their plan made public.
which probably will result in saving the road
from a receivershp, although this is not GER
tain. The question of receivership appears to
have been left 10 the noteholders for determna-
ton, according to the formal announcement
Of the plan provision has been made for re-
demption in cash of notes the owners of which
may not desire the notes, although
cured. and as the supplying of the S5,OOO,O0O new
capital which has been arranged for is condi
toned on the acceptance by the holders of all of
the outstanding notes of the offer Of exchange
into the per cent secured obligations.
With the possibility of "A receivership the al
tentative in which the old unsecured
notes would have no better standing than that
of general claims against the company. there is
not likely to be dissent on the part of the note
holders. But as the holders understood
be widely scattered, there is a very fair posi-
plIlty that the stringent requirement that all of
the notes must be turned in by Wednesday after
noon may not be able to be met The delay of
the directors in deciding plan and making
public its terms has met with much criticism in
financial circles. As, however, a necessary pre-
!iminary TO the authorization OF the new notes
10y the directors has been their approval by the
upstate Public Service Commission, the consent
oi. WINCH was granted recently March 81.
il may be that the responsibility for the delay
lies with the commission and not with the board.
In addition to the Erie com pliCatOns which
have served to call attention to the possibility
Of trouble for other railroads not in a strong
position financially, reports of the subsistence of
the recent improvement in certain industries had
an adverse influence on the stock market and en-
courased a renewal of activity the part OF
operators for the decline, who for several weeks
had venturcd to do little. General business
taking the country whole, is reported by
the mercantile agencies as improving moder-
ately, although still far below the normal But
the upward movement in the steel industry,
cording to widely credited ports, has been
checked and a rather serious falling off in the
volume of business has occurred In the
copper industry. too where recently there was
activity, at rising quotations for the metal. and
the market said have been sold out
prices declined last week and demand subsided
Changes in a single week. however. are not nee
essarily significant of a setback in the slow gem
eral movement of trade and industrial recovery
from the stagnatior following he panic What
must be borne in mind is that the indispensa-
is the restoration of confidence and confidence
is returning-nOt rapidly. for the shock suf-
fereG in the major panic of last fall was too Sc
we're for that-but none the less certainly be-
cause slowly. As the re-establishment of CON
ndence proceeds the investment demand for
Curities will become important and
the railroads, enabled to dispose of their Sc
curties, will be in position to place orders in
heavy volume with the steel companies and the
equipment compa MES, and operations will he re-
I Sump1 n tod by-+I +I1a
ing cost of money within the last year or SO
the working out of which will involve the ex-
tensiVe use of copper.
The money market is abnormally easy for this
time Of the year, and the Associated Banks OF
New York now hold a surplus of more than
S4oOo0OoO in excess of their required reserve.
These are natural sequences of a period of panic
and natural accompanimentS of period of bust
ness depression: and with the gradual growth
OF confidence profitable employment will be
found for the idle funds now massed in the
banks How soon the Improvement in general
conditions will become definitely marked and
Will begin TO make rapid progress depends in
large measure upon the crops and upon politi-
cal developments. 1t is early for crop forecasts
but il is known that the weather conditions
have been favorable for winter wheat. and the
nrst government repots on this grain. to be is
sued in the current week, is expected to con
firm the high estimat published lately bv pri-
vate experts. AS for the consideration of poll
tics, it may be said that a Presidential year is
always one of partial unsettlement Of business
but before the end of the summer the proba bill
ties Of the outcome of the contest between the
yet unnamed candidates of the two great par
ties will have be ne fairly we'll ascertained
and the likelihood of the success of the RepubIi-
can policies will powerfully assist in the hasten
ing of the return of prosperity.
The reduction Of the Atchisons dividend rat
was reassurns incident Of the week as indi-
eating the belief of the directors in the sound
policy OF making dividend disbursements con-
form to earnings. Similar decreases are 10 he
expected i'm the cases of various other roads
some probably amounting to suspension of diyi-
dends, while here and there it may prove uos-
sbe through drastic cutting of expenses 70
maintain the dividend rate The most recent
reports of earnings show in many instances ma
terial reductions in operating expenses whicn
however represent the cutting off of every ex-
penditure not absolutely necessary for the sa fo
operation of the property, policy under which
some systems like the Pennsylvania brought 10
the highest state of efficiency through liberal
expenditures covering a series of years can ef-
feet important temporary savings Railroad
earnings are showing slight improvement bUt
the decreases in gross are still very heavy
The record Of failures during the last three
months tells in striking way the story of tba
depression from which the country is lust he
ginning TO rally, the total number of failures he
ing larger than for any corresponding quarter
in the past ana the aggregate liabilities being
exceeded only by those for the first three months
IN 1873. II is an encouraging fact, though that
IN the three months just passed there have been
practically no disasters to financial institutions