The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1909-10-24
WALL STREET NEWS
Advance in Sterling Affects
the Stock Market.
DECLINE DUE TO LIQUIDATION
UnfavOrable Impression Caused by
Pronounced Weakness of Great
Northern and Northern Pacific
StOcks-Prices Have Moved Down
ward During the Week.

New York. Oct. 28.-Demand sterling ex-
change, which, in the late afternoon yes
terday. fell to 4S7ls. or 10 a point of
which gold exports on any basis were
impossible, rallied shortly after the open
ing OF business to-day to 4S7&. which
again made gold shipments a near posi-
bilty.
Partly on account Of this. no doubt, but
more reasonably because Of the general
state of speculative apprehension at the
moment, the stock market again de-
clined to-day. and with about as much
violence as 1t did on Friday.
OF course, spectators for the decline
assisted the fall but the bulk Of the de-
cline was plainly due TO liquidation. Net
recessions were scattered to about the
same extent as they were yesterday. al
though the fall In United States Steel
common was relatively less than it has
been recently on days Of general mar
ket decline.
UnfavOrRbIe Impression Made.
An unfavorable impression was made
by the pronounced weakness OF the Great
Northern preferred and Northern Pacific
stocks. There are stocks which. durine
the summer. participated but little in
the advancing tendency Of the market
and a fair argument from the fact had
seemed that these particular shares
would present as firm a front as any in
the time Of a general decline. due 70
technical market reasons.
Union Pacific common stock. too. was in
specially weak issue and declined nearly
four points. II is a matter worthy OF
note, too. that the days fall went on
regardless of a prevailing anticipation
that the weekly bank statement would
report a considerable increase In surplus
reserve
The published return certainly justified
these anticipations. for It exhibited ar
Increase in the average surplus OF So
100000 brought about by cash increase
of $5.OO0OO0. and a decrease in loans OF
@.747.O00 and in an increase in the actual
surplus Of Sl.06S 975. which was the joint
result of an increase in cash Of more
than S.3OOOOO. and an increase in bank
loans of 100000
Moreover, just as was the case last
week, the statement Of banks outside OF
the Clearing House Association was re.
markable These institutions decreased
their loans Of Sl0,S0O 600. and reported a
small increase in cash.
As throughout the week. prices have
moved steadily downward. and inasmuch
as il is plain that at least a considerable
amount OF foreign loans have been taker
up by home bankers. there can be nc
question that the process hitherto named
by banking authorities as that which has
been the true source of the immense
loan contraction that has taken place in
our country in the last four weeks. Is
again continuing its work. namely an
unlocking Of private financial resources.
or in other words, "a private extension of
credit on a large scale.
Bankers Relieve Themselves.
It can hardly be contended that until
the circumstances have prevailed here
In England. and on the continent OF
Europe during the last week our bankers
have again managed TO relieve them
selves by successful appeals TO foreign
lenders. and the proof now presented
must be held 70 be conclusive that IN,
potential credit Of our country, and tn,
possibility Of changing it into activ,
forms Of money is vast
There was during the day on the floor
OF the stock exchange a rumor OF highly
favorable import TO the effect that the
Bank Of France had expressed a willing
ness to release. either directly or indirect.
~. a large sum Of money for the especial
benefit Of the English financial market
Conversely, the Bank OF England raised
its bid price to-day for American gold
and the current impression was that the
Imperial Bank Of Germany will again adj
vance It's discount rate on Monday.
Here the only definite DEVELOPMENT NJ
the day. aside from the renewed strength
OF sterling exchange. was an increase in
the sum Of $4,000 of yesterdays gold en-
gagements for shipment TO Brazil