The Washington times., 1909-10-31
MARKET CONDITIONS
SUGGEST CAUTION
Money Largely Employed in
BuSineSs-Foreign Trade
Balance Against Us.

NEW YORK. Oct. S1.-wisdom
would seem to suggest the policy of
going little slow in stocks during
the current week. It is not likely that
the interests that control the situa-
tion viii permit of any serious slump
in values, nor that the bears VIII have
the temerity to make attacks with
any show of force after the display
OF strength given last week and OF
unanimity OF action on the part Of
the various groups and pools. The
rise has given the insiders another
opportunity to turn an honest dollar
by liquidation of part of the securities
acquired at 10 points below cur
rent quotations.: to distribute part
of the heavy foreign holdings that
have been sent home from London and
the Continent in the adjustment of
finances.
Conditions in the United States are
too good. the Industrial prosperity too
soundly based TO permit OF any severe
reaction, but until such time as
money works materially easier than il
is at present until the return flow
from the interior and the let-up in
the fight for gold on the other side,
stocks are not likely to advance much
above present values.
With conditions as they are in the
Industrial and commercial world. with
easy money, railroad earnings steadily
increasing, equipment corporations
working TO their limit, there will in
time probably be higher prices estab-
lished than anything current during
the month just closing.
November Tight Money Month.
November is usually a month of tight
money. and the incoming month prom
ises TO be no exception. The bank state
ment yesterday was much more disap-
pointing than had been expected. with
the loss OF nearly three millions In re-
serves. From various sections of the
country come reports Of the large use
Of money In business and manufacturing
industry. In the days following the
recovery from the panic of 1897 the pie
thora OF money ena bled the WaH Street
magnates to extend their operations,
and enabled them TO carry stocks until
the prosperity warranted the advance
that had been established Now, with
a full return OF business prosperity lhe
Street must expect that money will flow
more freely In natural channels, ard its
surplus to be cut down.
London's liquidation OF american
stocks during the period of advancing
bank rates totaled about $50, 900 TO 400 900
shares much of which has crossed the
blocks were shipped yesterday, and viii
reach here late in the current week
Included in the estimated liquidation
were many stocks sent over because
IN London The arrival OF the stock
en- route is likely TO have some marked
influence on the loan items.
Expect Reflect of Bank Showing.
The reflection OF the bad bank state
ment IS likely TO be found in reac-
tlons with the opening days OF the
week The policy advocated by many
OF the leading commission houses in
advice to buy on weak spots and sell
or strong" will probably prevent re-
actions from COINS TO anything ike
serious or even liberal declines.
The bears, even though strong In their
convictions haven't the courage TO at
tack such a well-suppOrted market,
when everything on th5 business map
looks so roseate and full of promise, 50
that reactions viii be more In the ma
taking.
And the sold-out bulls will watch for
the reaction to get in again.
one of The favorable features of the
last week was the broadening Of the
whole market. the passing OF the period
when operations in two or three stocks
furnished about half the daily records
of sales The manner IL which the in
dustrial list sprang into prominence the
revival OF activity and strength COM
bined in the Copper, and equipment
stocks was a distinct help to the whole
list and made the excellent late in the
week recovery easier to establish.
This feature of the situation vas re-
fiected in rises OF 4 10 60. points IN such
leading indusuials as Locomotive, Car
Foundry, Pressed Steel Car, Smelling,
and Copper with Ike or pTOpCrtiOnate
advances in many other industrtals.
Vulcan DEFINING, although not one of
the active leaders, added AZ points on
the common and Il on the preferred,
with reports Of most encouraging
character as TO its probable future. Steel
common. which continues to lead the in
duEtrials, moved up 3lz points, the pre-
Terred 21s- The statement was not quite
as good as expected, but the stock has
an army OF friends and many buyers. for
long term Investments will continue to
take IL on ali weak spots.
Foreign Trade Situation Unfavorable.
Our foreign trade situation is by no
means favorable. It IS within the pfoba-
bIlities THAI gold Will be drawn abroad
or more Of our stocks in Europe sent
back 80 us.
Usually at this time Of year we are
importers Of gold. Our cotton exports
are TIE gold bringer. but this year be-
cause Of the small crop and the high
and anticipation OF tariff changes has
brought our imports 10 such large vol
une that the Daiance OF trade Is against
the United States. A balance against
us on account OF merchandise amount
iElg 10 s97. 90. 900 whereas at the end Of
the sarIe period in 1908. nine months
statistics, We had d merchandise bal
ance of trade in our favor Of S43Z, 200, coo.
Money Is much higher and the bank
surplus Of the associated banks Of New
York greatly decreased as compared
with the same time 1908.
liberal gold exports would check ac-
tiyity Ia stocks on the bull side The
more general use of money In CONNER
cIal enterprise viii prevent the return
flow 10 New York Of much Western
money that has heretofore found eIa-
ployment in the stock market
Caution Advised
Under these circumstances II does not
look as II the market could make great
progress toward higher figures In the
near future but rather that il Will con-