New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1909-09-20
BULL TRADERS ACTIVE.
Spectators Paying Little attention
ito Signs of Higher Honey
Strong Industrial Factors.

proceed with their manipulation there will be
the sort of disturbance in the money market
that not only will injure the bull following on
the Stock Exchange but also will exert an adj
verse effect upon general business in this cOun-
try. A few years ago number of reckless
Western spectators. assisted by speculative
banks brought about a serious situation In the
Street by their operations for higher prices at
a time of hardening loan quotations. The out
look SO far the money market is concerned
is the same to-day IL at that period. and
it is TO be hoped that the power of the legtti-
mate banking interests in the local financial
community will be strong enough to prevent a
continuation of a speculation that do no
good 10 actual investment values and which
contains all the elements of serious speculative
disaster The industrial situation is strong ana
all factors point 10 great expansion In all
lines of work in this country If not hampered
BY overspeculation and an inadequate supply
Of capital President Taft is authority for the
statement that the nation is the eve OF
great industrial awakening and that there will
be no thoughtess legislation TO check it, Unity
Of purpose and determination 10 work in har-
Ynony are noted among the great financiers and
business men of the country; education seeking
70 impress upon all sections of the United States
the necessity Of real currency reform is pro-
ceeding In a most satisfactory manner. and i'm
portant negotiations for the better control and
concentration of corporate interests are under
way. These factors are encouraging signs of
an age of progress. but they do not warrant an
outbreak of unbridled speculation.
The stock market has enjoyed enormous ap-
probation in prices since the panic of 1907, and
while later in the season some further advances
will not invite collapse it is safe to say that II
a furious bull movement is allowed to proceed
in the next few weeks trouble will develop.
After great panics money becomes abnormally
easy. Yet when conditions change they change
with surprising rapidity. Money Is easy now,
but we are two years away from the last panic.
and if history counts for anything at
about the end of the cheap money period. Indi-
cations point TO an advance in the discount rate
of the Imperial Bank of Germany. Not infre-
quently in the past the first sign OF a hardening
in the money markets of the world has. come
from Berlin. and if one goes back to this time
in 1905 il viii be found that the German bank
started the advance in loan quotations that
tended at that period to London and New York.
rates for call funds at the latter point advanc-
ing TO 125 per cent before the end Of the year.
And conditions in the stock market now are
similar TO those then prevailing. The interior
took moderate amount of currency from :his
centre last week. while the local banks lost
heavily TO the government and. though a re-
duCtiOn in loans caused moderate gain in the
reserves of the Clearing House institutions. the
surplus is a level that ought TO encour-
age the greatest conservatism in the stock mar
ket for weeks to come. Nothing has developed
that should worry actual owners OF American
securities. The intrinsic worth OF these issues
is increasing, but their market values have
about discounted all the favorable features in
the situation. And If. as indicated. the time OF
cheap money rates IS over stocks will look far
from attractive purchases at ruling quotations
Every reason exists for optimism over the coun-
try's future. There is no room here for the
pessmst and no argument for a material de-
cline in stock prices. The true optimist ~
present is the man who seeks 10 maintain the
stability of the markets and to discourage the
idea that just because fundamental conditions
are sound manipulation of prices TO higher levels
IS warranted The panic Of 1907 apparently has
been forgotten, but it may be we'll TO recall the
fact that overspeculation that resulted in a
burden that carried credit down was in large
part responsible for the troubles OF that un-
fortunate period.
In the week just closed new high record was
made by United States Steel common while it,
tie interest was shown in the preferred which
has proved its claim 10 high position in the
| investment list Of securities. The common
doubtless will be placed upon a better dividend
basis before the end of the year. and il is not
unlikely that it viii sell at par. though for
the general reasons already noted the future
market position of the issue viii work out better
if for a time at least reckless speculation in II
could be checked The iron and steel industry
practically has returned TO a normal basis, so
! far as production IS concerned, and while prices
are still under the level recorded prior TO the
establishment of the open market. last February
! II is quite likely that further advances will be
made in the course Of the remaining months of
the year. It is estimated that in the current
quarter net earnings of the United States Steel
Corporation viii in the neighborhood OF
! S37,OG0,O00 as against a little more than $29-
/ 100000 in the three months ended June 30 and
proportionate Improvement doubtless will be re-
ported by the independent concerns The di-
rectors Of the United States Steel Corporation
will meet on the last Tuesday in October for
dividend action, and from the course Of tne
common stock it is believed at that time the,
dividend rate viii be increased to per cent
quarterly. and possibly IA though the chances
are that the latter rate will not be established
until 1910. on the basis of current earnings. the
corporation is making Il per cent year on the
comI.o< stock after all deductions, and If it
earns as much S42,0OO000 In the last quarter
Of 1909 the earning power would be at the rate
! Of II per cent for the common--prObable results
that warrant the expectation of an increase in
the disbursements TO stockholders The large
interests closely identified with the United
States Steel Corporation hold more Of the COM
mon stock to-day than at any time since the
organization Of the concern. and large part of
these holdings is for speculative account on the
practical certainty that they can be liouidated
at some time at par or better
Time money is firmer and higher quotations
! for cali funds are looked for. the rate for the
latter last week touching per cent for the first
;ime IN many months The hardening in money
MAS reflected e. only small extent in sterling
exchange, rates easing Off toward tho end Of tho
! week under the influence Of a fair Offering OF
bankers bills, commodity bills being in light
supply. Prospects for gold imports this fail IRE
/ not particularly encouraging. but It is assumed
/ in banking quarters that in the event of acut,
/ strIngoncy here enough foreign money viii he
attracted 10 New York To carry the burden IT
speculative loans. though IL may be well TO norc
I the fact that more active inquiry for funds is
! 6eVel0nin- al ,apftals tba4 Go.