New-York tribune., 1909-02-16
FINANCIAL AFFAIRS
STOCK VALUES UP.
Erie Bond Decision Helps the Mar
ket-Money and Exchange
Rates Easy.

Stock market values were strong and higher
in tha greater part Of the day on small voiuH'e
of business made up chiefly Of the operations
OF the professional element. commission houses
having few orders for public account. while the
substantial Wall Street interests who were the
active backers of the bull movement last year
were not identified with the dealings. except III
certain cases, where they supplied STOCK on llie
ADVANCE The decision Of the upstate Public
Service Commission 10 grant the application OF
the Erie to issue S30.0oO,0O0 bonds was an I'M
portanr factor in attracting the settlement OF
short contracts, while IT served to induce n1oo-
crate dealings for quick turns the long side
Of the market. In permitting the Erie 10 place
a new issue OF bonds. the Public Service COM
mission imposes terms that make the payment
OF di-idends on Erie shares out Of the question
for a long time 20 come, but it gives the road
an opportunity to adjust Its financial aneirs 70
a stronger and safer basis. that eventually
shouId carry the stocks Of the company TO the
dividend column. Tha company VIII be able 70
take cara of the coupons falling due from
January 1909 to January, 1913. on the general
lien and convertible bonds; 1t VIII be able 10
meet it's large amount Of notes outstanding. and
Il will have a moderately large amount Of new
caD,taI 10 mt into the property. AS the
panv must set aside and eXpend from income
every six months for Improvements and addi-
tions an amount equal TO the coupon interest
refunded, there will be little chance or sur
plus for the stocks unless there should be q
tremendous gain in revenues, but in expendlng
this amount of money on the road the company
will improve its condition TO a degree that grad
uaIIy will enhance the actual value OF its Securf-
ties The Erie has great possibilities and some
day It ought to rank IN the first line of Arneri
can railroad properties.
Erie shares were active features at the open
ing, and in the early dealings enjoyed marked
Improvement, failing, however, to maintain
their entire gain in the subsequent operations,
while in most other parts of the list last prices
showed in net advances most Of their maximum
rise. The standard ISSUES reflected the presence
sy, +harD oS sis n
being especially pronounced in Union Pacific.
the Ejll stocks Reading and Peoples Gas, the
last named ending at net gain OF 27s. The
railway equipment shares were in fair demand
at higher prices. the movement being accom-
panied by reports OF increasing ord5rs from the
transportation companies for new equipment
but the buying was wholly speculative in char
acter. investment purchases not being reported
IN these stocks or in any part of the market
except In the bond department, where there wes
an active volume OF business divided between
investment and speculative transactions. The
general character Of the days trading did not
warrant the assumption that a new bull cam
paign was about to develop, though commits
sion houses were bullish in their advices and
as a rule recommended the purchase of stocks
at ruling quotations 10 hold for better figures
The improvement recorded yesterday may in
duce some outside buying, and the operations of
the next few days therefore will be watched
with interest by people who have stocks and
ara anxious to convert them into cash at hand
ness was poorly distributed, and Of the 6S5. AT
shares dealt In twelve stocks supplied more
than two-thrds. The steel Issues were not at
fected by the failure Of the Pressed Steel Car
Company to renew it's contract with the United
States Steel Corporation for steel plate OF which
the first named concern uses, when operating on
q normal basis, something like 10000 tons
a year
Money in light demand yesterday and
rates for both call and time funds were easy,
while sterling exchange was lower a conse-
quence of the Improvement in foreign financial
conditions and the buying OF securities in this
market for European account. Purchases of our
stocks by foreign houses in the last week have
amounted TO upward of 10000 shares repre-
senting in part covering of short contracts and
actual new business and, according to current
indications. the movement VIII make further
progress Europe shows favorable attitude
toward this market a result of its own
strengthened situation and the persistent firm
ness OF prices here in the face of active efforts
on the part OF local SPECTATORS to bring about
q lower level OF values. Though Saturdays
statement OF the Clearing House banks showed
a comfortable reserve above legal requirements
there signs OF gradual hardening in money
rates in the course OF the next few months fed.
erai government demands upon depository
banks and the proba bility of better mercantile
inquiry for funds. 10 say nothing OF require
rnents in connection with railroad financing
suggesting pressure upon the banks that viii
reduce holdings TO a point that will establish
loan quotations on a higher range. The trust
companies. which in unusually strong
position, mag be depended upon to prevent