The morning journal-courier., 1908-12-21
FINANCIAL REVIEW Sharp Setback Surprised Spec ulators Expecting Strong
 Support of Prices. RISING INTEREST RATES Anticipated Abundance of Money Makes Possible Demand Greater
 Than Supply.

The sharp setback in prices of stocks which occurred last week belIed the hopes of the speculative element which counted on the protection of the mar ket against reaction by the millionaire operators through the tightening of the year-end money markets. The support Of the prices which has been rigidly maintained at all stages of the great rise of the last few months was seem inRly abandoned at times during the week, and the diminished supply of re- sources available for borrowing for speculative purposes was clearly an element in that course of conduct, Al the same time some of the weeks de- velopments were regarded as an index of an over sanguine assumption in the earlier speculation as to the favorable course of events.
 The causes back of the rising inter est rates for money were sufficiently obvious The weeks drain on cash re- sources alone, what with the gold ship ment of the previous Saturday and the large sums paid into the sub treasury on subscriptions to the Panama canal bonds, was sufficient to wipe out the surplus reserve of the banks. At the same time nearly every day saw an announcement of some now bond sale or Of some issue to be offered for sale in the not distant future,
 The rise in money rates was effec- tive; first, in checking the outgo of gold and then in attracting some funds from other centers to the New York money market. The New York eX- change rate Chicago advanced to a premium in the process of remittance These sources of relief while calcu- lated to supply requirements of syndi- cates and mercantile borrowers, are not go assured a resource for stock borrowers.
 Tn the longer view of money market also, the conviction is not so strong that extreme ease of money will follow promptly after the turn of the year Enormous capital issues await that season for Notation of S225, ,0oa 900 Rus sian, loan In Paris and extensive rail- road borrowings here being included intimations from London that the Bank of England WI begin policy of gold accumulation with the new year to bring it's holdings into line with the great increases of the government banks on the continent of Europe. Tn New York the amendments made last year to the banking laws, provide that the full requirements on the trust com panies of 15 per cent of deposits to be held in cash in their own vaults shall go into force on February l. Since July l Since July 1 last these companies have held 10 ger cent. of reserves and fl is estimated that the Increase Of 5 per cent, will call for something like S45,O0O, ,000 It Is expected that the ac- cumulation of this considerable sum will begin soon after the first of the year. The possibility is thus presented that the great abundance of money lookew for after the first of January may have been anticipated from so many others that the demands upon 1t may outrun the actual supply or greatly modify it's effect on the rate Of interest
 bOIn III lHt IltIu pl lIlhuS'I anu 'A politics, some of last weeks occur rences were looked upon as showing that opinion in the financial district had been over-running the event
 The progress of hearings on the tar if revision before the ways and means committee of the house at Washington indicates widening scope and deeper consequences to flow from the course to be taken by that work The attitude or the President-elect on that subject as disclosed In his public utterances are taken to foreshadow his active sympathy with this tendency. MT Tafts view on the Sherman antitrust law also remove some assumptions az to the immunity likely to be enjoyed by the corporations under the new admin istration from the application of that statute.
 The belief in those interested in rail- roads that the comprehensive In rates and classihcations proposed by all of the great railroad systems will become effective and vii be a material factor towards re establishing the revenues of the railroads, is a strong underlying influence in the stock market The placing of the Pennsylvania railroads yearly order for steel rails was an i'm portant incident of the week, It is supposed that most of the railroads in the country have been awaiting the de- eision of disputes involved in this or der before providing for their own re- uuirements A general placing of or- ders soon is therefore looked for now.