New-York tribune., 1908-01-27
THE WEEK IN WALL STREET.

ket during the last week winch was one VI ~
stricted volume of transactions and OF uecIiI'"e
prices the result of profit taking by investors
and operators who had bought securities lh ti'e
panic period and had seen them rise III pi ne
10 level representing handsome IetuI'i9' "
short selling by operators who judged lhaL tie
extent OF the advance had been even srea'1 s,
than the extent of the Improvement III az
conditions, and perhaps most lfhpol 'li' VI
dation by interests who in the dark Gays iiai
taken over extensive holdings of securities from
others not with the desire of making invest
rneuts but with the object Of carrying the 1or-
mer holders through the crisis. ana which ia
rrallv availed themselves of an opportunity OF
closing out those holdings when they mad risen
from sacrifice to satisfactory prices
In respect of the png up Of idle funds also
urecedents are being followed, as had peeIt pre-
dicted and certain Confidence in the stability
of the banks having been restored the vast sums
Withdrawn for hoarding a few months ago are
being returned 10 those institutions. ana Win
the certainty established that the panic was
thing of the past the banks of the interior be-
gan To release the reserves, In many cases eN-
ceedingly high. which they had accumulated
largely through Withdrawals OF balances from
this city for fortifying themselves against pcs
sible runs and during the last few weeks they
have been forwarding these moneys again 10 thlS
centre for employment. As a consequence OF
the enormous and continued inflow of cash, cou-
pied with the stagnation of business the aSso-
cisted banks OF New York City have within two
gate reserve so heavily TO replace the s54,-
O0O 600 deficit of the latter part of November
with the $S7. COOS 600 surplus shown III Satur-
days Clearing House statement anc the sup
ply of loanable funds has become much larger
than the demand with the result that rates for
time loans for all maturities have declined to
small figures. while the call money rate has in
the last week dropped 10 the nominal point Of
- per cent
This condition Of money ease is becoming
r}iric of 111n11
sfringency only few months ago. The Bank
of England last Thursday reduced it's minimum
rate of discount l per cent for the third success
sIye week. the -ate now standing at per cent,
against the extremely high rate of per cent
which Was maintained during the panic here ana
which proved unavaiing 10 prevent the export
to the United States OF the gold required here
for correcting the panic situation and ending the
premium on currency. In the last week, also,
The state banks of France. Germany, Russia,
Denmark and the Netherlands have further low
cred their official discount rates.
All danger of recurrence of money famine for
a considerable time to come having been re-
moved the Secretary of the Treasury has
deemed il desirable 10 recall another $l0,000000
of the money held by the government depOsi-
tory institutions of this city for the purpose of
increasing the working balance of the Treas
ury, which during the height of the critical
period just passed had been reduced to the ire
duCble minimum, and he may be expected to
/
banks meet with no Inconvenience. The
foreign exchange market has shown such
strength of late to suggest the possibility of
gold export movement, which, however, Will
probably be averted by the Withdrawals Of cash
for the of the Treasury, as the advance IN
the sterling market has been due to the extreme
cheapness of money here and has not reflected
any urgent requirement for gold from European
financial centres.
The great Improvement in the banking posi-
ton has been demonstrated in the retirement OF
all Clearing House loan certificates by the banks
IN many cities and the curtaiment to nominal
proportions of the volume of outstanding GER
tifcates in the remaining cities in which clearing
| houses are maintained. In New York City,
where S97 0O0. .Oo0 in certificates issued, only
| between $60O0.000 and $7,0O0O00. representing
! the obligations of only three banks, remain to
! be cancelled
That the present condition of business is de-
pressed and Unsa atisfactory cannot well be gain
/ said. Railroads are reporting decreases in gross
! earnings. rejecting decreases IN the volume of
! production of iron, steel, coal and other
modities and from all quarters are coming an
nOuncements of cuts in salaries and reduction of
! the number of working hours. The quarterly
report OF the United States Steel Corporation to
| be issued this week and expected show a
! sharp decline in net earnings is awaited by Wall
Street with the greatest interest calculated To
! give 4 trustworthy indication of the extent of
! the general curtailment of industrial activity.
| When the depression VIII begin to lift no man
| can vet say An unfavorable factor is the Pres
| identiaI campaign. which commonly causes bust
! ness unsettlement and which may retard this
| year the normally slow recovery Of confidence
! which must precede the entrance of the country
| upon another period of ahounding prosperity.
| But with all uncertainty removed to the ad-
| herence Of tho United States to the policy Of
! sound money. with the federal Treasury in
! strong condition. with its 235,0000Q0 on deposit
| in national banks and with the West and South
| mortgage free and easy in circumstances. the
early termination of the inactivity which now
| prevails the industrial, mercantile and trans
| portation fields. improvement which would
| be powerfully stimulated by the harvesting of
| bounteous crops Of grain and cotton in the com
| ing season.
| Improvement in general conditions like i'm
! pending troubles is foreshadoved by the course
| Of the stock market. and Improvement in stocks
| Is preceded by quickened movement in the
| bond market And il is encouraging fact
! that the bond market has begun show signs
| of activity. the investment demand having Of
| late been sufficient 10 absorb many millions Of
| New York City bonds. we'll as the funded
| obligations of railroads In consequence of the
| ease in the money market, railroads are once
| more coming forward as borrowers. after a long
period Of enforced abstention, due TO the impos-
| sibili;y Of obtaining at rates not runous the
! funds needed by them for betterments and the
| extension Of facilities required for the more
| profitable conduct of their business.