Omaha daily bee., 1909-01-12
NEW YORK STOCKS AND BONDS
Market Undergoes Further Process Of
Speculative Deflation.
ERIE LEADS DOWNWARD MOVE
Refusal Of Public Service Commission
TO Approve Bond Issue Plan starts
selIinE-Harriman's Alleged
Illness n Factor.

NEW YORK, Jan. 1.-THE stock market
underwent a further process OF speculative
deflauon today. The adjustment towards
q lower level was clearly due to conviction
mat the previous advance mad exceeded the
warrant Of the good in the condition and
the prospects,, rather than from the deVel-
Opinent Of any factor Of positive discour-
aSement In the situation or outlook.
The severe break in the Erie securities
nad a special explanation In the belief that
the proposed $O,OOO,OC BOA issue, which
was the plan of financing the roads neces-
SUES selected by its directors, had failed
70 meet the necessary approval of the pub
nc service commission. 1t was claimed
mat a substitute plan was already tOrmu-
Ialeu which would supply the needed re-
sources and also meet with the consent of
the public service commission. This did not
serve to avert the crash In the quotations
OF the Erie shares, and the unsettling eff
rect OF this crash on the whole of the gem
erai list. Those shares played the same
part In the speculation that was played
last week by the Consolidated Gas, the New
YORK Central and the Interborough-Metro-
pontan stocks in succession. The slump
was aggravated by the reiteration of the
dlsquleting rumors Of the condition OF f.
II. Harriman's health, although these were
a9thoritatively denied. The constituencies
OF Erie to this rumor was another re-
hinder Of the extensive speculation which
mas been based on the Assumptions of Mr..
IONS IN regard to a most complicated and
comparative plan Of railroad b~etterments,
much of which was clearly beyond the
powers or a single individual to perform.
Inc failure of Nj. Harriman's expected
appearance in the New York Central d-
Iectorate last week served TO chill conf
uence In many of these speculative as
symptoms, the case of the Erie shares to
gay offering a conspicuous example. While
ne sympathetic effect of these specia points
OF weakness In the market Is not lost sight
OF, Il Is clear that there had grown up a
sentiment OF distrust of the speculative po-
sition, which left the market vulnerable to
this sympathetic influence. Advices which
went out from Wall street at the end of
iast week from brokerage and commission
/ a nKnltntf Wun Ata- T. T.
Stances OF the danger Of a break in prices.
Inc result was felt in the character Of the
5roeTs Tor execution in the market today.
An important and organized bear party
was arrayed against the market and the
nulI position was held timidly and with a
nrrssbhIVVe intention TO retreat before unfav-
The speculative sentiment is shaped to
some extent by disappointment over the
response 70 the rapid easing of the money
market, which is more marked even thar
was anticipated. The further engagement
r. sUiG Tor export today, the expectation OF
prospect for a rise in the Bank of Eng.
; fanu discount rate and the announcement
from Washington over Sunday of a call or
national bank repositories for return OF
another S25,O0O,O0 of government funds were
OF no apparent effect in disturbing the ease
u money. IL was remembered, however
that redundant markets in times past have
Deen witnessed in times of profound stock
market apathy, just as excessive strin.
gency has. proved ineffective on more thar
one occasion to overturn a speculative DO.
sltlon for the rise. The Influence of thi,
recolection Is not entirely prevented by tn,
Lalth mat the present industrial state is fal
from that of the periods OF stock market
repression when money as a drug in tn,
market failed to stimulate stock marke.
aetivlty; The variation in the present sit
uatlon Is seen in the eager diversion of de
mand from stocks, at the high prices t.
Mhlch they had attained, into bonds, new
issues OF which continue to be absorbed II
a manner to denote an almost insatiahI
|, investment appetite. The afternoon rail-,
! IN the prices followed the evidence of sun
are generally small. e0
bonds were irregular. Total sales pa
vaiue Were $5,564,OoO. United States bond
We're unchanged on call.
> ne following were the closing quotation