Omaha daily bee., 1909-10-25
Number Of Theories Given to Account
for Unusual Action.
AMERICAS BORROWINGS LARGE
BritOnS Charge it to Heavy specula-
tion in New York.
IMPORTS TO AMERICA GROW
At Same Time Exports to Europe Are
Mach Smaller Than Usual, and
This Is Held to BE BEESest
Factor.

NEW YORK, Oct. A.-The Bank Of Eng
land has commanded the attention of the
whole financial world in an unusual degree
during the last week with its third success
sive advance in it's official discount rate
In two weeks, doubling the rate in thai
period. Ominous limitations come from
the English center at the same time that
additional protective measures will he re-
sorted TO IL found necessary to avert fur
ther inroads on Londons banking resources
Coming In the wake Of period OF assur-
ances Of the ample resources Of the money
markets to meet all the exigencies of the
season, this action OF the bank furnishes
undeniable evidence OF a wide mlsca ,ula. .
ton Of the situation. On what may b. the
elements in that miscalculation opinions
Sasfer but there are certain of the factors
M tbe problem which are clear. one Of
these Is the fact OF extensive American
borrowings in the London money market
Critics in London allege that an u1oridled
speculation I'm the New York stock market
is primarily responsible for the condition.
The prolonged advance in prices in New
York and the high rate OF activity in tho
stock market dealings are corrohorative
of that view.
Heavy borrowings Abroad.
Borrowing from foreign money markets
through the summer is a usual proceed
ing on the part of New York The amount
Of New Yorks borrowings this year, which
are currently accepted. point to 4 heavy
excess over the customary amount, round
billion dollars being the figure most fire.
quently heard. The current estimate IL
questioned by such an authority as Jacob
II. Schiff, head Of Kuhn. Loeb & Co.. VINO
says exaggerated ideas prevail as to the
amount Of these borrowings, and who as
serts also that they have been much re-
duced in the last few months.
Big Increase I'm Imports.
one OF the principal elements in the mis-
calculation OF the autumn money market
undoubtedIy lies in the abnorma; state of
the country's foreign trade. Imports have
been. largely in excess of normal, partly
owing to the natural revival of trade, which
has extended to foreign as we'll as do
nestle products, and partly to the rush Of
imports In anticipation of the provisions
of the new tariff bill.
Not only have imports enormously in
creased, but exports have decreased. The
discrepancy here shown is sufficient in it.
self to account for much OF the scarcity
of exchange to provide remittance abroad.
Another element is the delay in the ssu-
ance Of new bonds by the great corpora
tions for which Important foreign sub
scriptlons were expected, which would serve
to take up part of the maturing foreign
Indebtedness of more temporary nature.
The bend market is sluggish and ioes not
invite 70 large new offerings.
Demand for stocks rails Off.
The action Of the stock market has shown
the contest going on against the unfavor-
able Influence Of the money situation. The
brilliant business outlook encourages the
obstinate holdings OF stocks, even while
vthe narrowing money resources reduce the
Remand. The rapid rise in foreign exchange
T~fates last week showed plainly. however,
that foreign lenders OF money here we're in
sistent upon repayment of maturing obliga-
tlons. The movement of the interior cx-
changes, meanwhile, showed that The de-
mand for currency was not yet justified