The Washington herald., 1908-02-21
WALL STREET NOTES
Bonds Fail to Benefit by Sale
of New York Issue.
UNION PACIFIC SHOWS GAIN
Result of Illinois Central Decision
Taken Advantage of by the Bulls.
B. & o. Statement for January
Somewhat OF DISAPPOINTMENT.
Commission House Business Dull.

New ork, Feb. 20.-Bond dealers said
to-day that the market for their wares
has not felt the effect OF the successful
sale OF the New York City issue in the
way they had expected. Instead OF grow
ing stronger, it has grown weaker and
narrower until it is now a difficult matter
to sell any considerable amount. even of
bonds of good quality. When actual sell
ing is attempted II is feared that existing
quotations are more less fictitious and
that transactions can only be made at
concessions.
The market. bond houses say, never
quite recovered from the effect of the
Presidents special message, and his let
ter TO the Interstate Commerce Commis-
sion regarding the railroad labor situation
has dealt it another blow. They are won
dering when an opportunity will be af
forded for the restoration Of confidence In
the class of investments that used 20 be
considered safe enough for a widows
money,
The decision rendered !n favor Of the
Hartman interests by Judge Ball in the
Illinois Central suit was the "favorabDe
development" which the bulls on Union
Pacific had been talking Of for some days
past The first news OF IL came by pri-
vate wire 10 houses with Chicago coRnec-
tons. Indeed, IL had been pretty well In
dcated by buying orders previously re-
ceived from that quarter. The private dis
patches, however, were closely followed
by the regular news ticker, but Wall
street was rather slow in grasping the
significance of the decision Of the court.
When it did tine whole market advanced.
Baltimore and Ohio issued for the month
Of January a statement that was rather
disappointing in the extent OF the de-
crease ia gross, and followed Il up by
announcing a sale 10 prominent banking
houses of a $4,000 issue Of one year
per cent notes-yet the price advanced.
Some OF the traders appeared TO have
been not unprepared for the news but
made the mistake OF going short in an
ticipation Of a decline on its publication.
They found, however, that advance infor-
nation does not always make a cinch
OF market operations. The stock was
made too hot for the bears. and those
who were well informed as to the earn
ings and financing had 10 run with the
others. When they found time for re-
Election they came 10 the conclusion that
short interest had been overextended-
some OF them estimated that the bear
account in the stock amounted 10 as
much as 10000 shares.
Brokers regarded the announcement OF
the 3. 6 o. note issues as a very in
terestlng experiment. few weeks ago
it was believed in many quarters that
the road would be enabled this year
TO obtain money on favorable terms
through the sale . Iong-term obIiga-
tiOns. and had il been made clear at
that time that there would probably be
another year OF temporary financing the
demonstration would have produced a
decidedly chilling effect. Now one OF the
trunk lines has made an issue Of short
term notes. putting UP long-teTm bonds
as collateral. and the street betrays no
sign OF uneasiness,
The traders had story about one Of
their number having made a handsome
turn on the short side OF the Gould
stocks. his selling being based on the
fact that he had seen member OF the
Gould family lunching at one Of the mod !
crate priced cafes on Tuesday from
which he argued that there WAS a feel
ing OF poverty in high circles other than
those referred to by Mrs. Hetty Green |
in the interview published Saturday II
was a farfetched assumption, but that
really did not matter when luck brought |
results.
Commission houses say the rise has not /
brought them business that in fact il /
has worked the other way. While the |
market continued weak they received a /
few orders. but commissions In the past |
day or two have been rare indeed. The /
fact illustrates how prone the public are /
to keep away from a market movement
in its earlier stages, and join II at or |
near its end
The business which ceased a couple OF |
days ago was mostly selling, but OF /
course. II meant revenue for the commits |
sion houses, whether il represented forced /
liquidation or short sales. Perhaps il |
the upward movement continues a few
days longer, there will be business again.
increasing until II becomes greatest and /
most confident at the top. Moderate |
price changes do not attract the out |
slider who wants action and usually gets |
it-but of a kind he does not expect.