New-York tribune., 1908-12-19
FINANCIAL AFFAIRS
STOCKS FALL AND RALLY.
american Smelling Once More the
Leader Of the Decline-Banks
Lose Cash.

The stock market ran an uneven course yes
terday. opening weak. then rallylng, breaking
badly lust after noon and recovering large part
Of its losses in the last hour, The leader IN the
decline was again American Smelling and Re
7ning which opened about g point down and
which in the afternoon touched 76s4. a new low
under Thursdays close, advancing in the late
rally 10 ass a net loss Of q points The sell
ing Of Smelters was accompanied by predictions
OF the damage threatening the compa - from the
projected Cole Ryan smelling company, which is
announced to be planning TO erect plants at vart-
Gus points in competition with those now oper-
ated by the American Smelling and Refining
Company: and II IS. Of course, not impossible
that competition and not combination may be
the outcome Of the matter. But the fact that
new company IS in contemplation IS not news,
and the conspicuous weakness Of Srnelters at
this time finds an explanation rather in the gen
eral market condition. which had become such
that an attack directed against one particularly
vulnerable stock might be expected 10 preCipi
tate & decline in the general list London was
seller in the early trading, disposing of 5000
to $4,000 shares and these sales helped along the
initial decline, which was further assisted by
short selling. IN the recovery Of the final hour
there was more OF less covering but the short
account IS still very large. Many holders of
stocks carried on insufficient margins came 70
grief in the course Of the day. good deal Of the
commission house business representing the
closing out Of these accounts.
The expectation of an unfavorable bank state
rnent to-day apparently had little part among
the market influences in view Of the sharp rally
toward the close. The preliminary estimate
based upon the known movements of money
showed a probable loss in cash Of more than
S2l 100000 for the week due primarily to the
heavy payments by the banks which were sub
sCrihers 10 the Panama Canal bonds. a shrink
age which unless Counteracted by heavy con
traction in the loan account will convert the
surplus reserve of the Associated Banks into
deficit. There has been large liquidation in the
stock market during the week which means cor
responding contraction Of the loan item and
there has also been in progress a considerable
shifting Of loans from the banks to the trust
companies: so that loans may not unreasona bly,
be expected 10 show q material decrease, al
though the borrowing on account Of the Sac
Paulo loan and the bond issue brought out by
New York State should not be overlooked.
The money market continued firm. the call
money rate touching 81 per cent. as on the pre-
cedirg day- and with the repsrations making
for providing for the January interest and dfvi-
dend disbursements, which are normally among
the heaviest Of the year, there is no likelihood
Of much relaxation in rates during the remain
ing part OF this month. That in itself would not
b cause for stock market recession as the
present rates for both day-to-day and time ac-
commodation are far from high but it is sup
Elementary factor in the decline Of the stock
market from a level which had been advanced
70 figures much more than fairly rejecting the
undoubted Improvement and return of confidence
in the business field