New-York tribune., 1910-07-18
FINANCIAL MARKET
Liquidation in Stocks Appears
To Be at an End.

ing price tendencies are reported, ano
while speculation is made UP in large
part of the operations of the professional
element stocks are in strong hands, with
little reliability of their coming out un-
til quotations move to materially higher
levels. Adverse factors in the general
situation have been discounted by the
decline of the last eleven months, and
good market judges believe that further
losses, If made, will represent little be-
yond the work of bear manlpulators
There is. no logical reason for deprecia-
ton in market quotations Of investment
issues. but traders who have overstayed
the short side of speculation are looking
about for arguments that may be used
TO induce liquidation, and in the abb
sence of real arguments they are manu-
featuring fables calculated to frighten
actual holders of sound American secu-
rites. The latter is q sign of despera-
ton Malicious rumors always appear
at the tail end of a bear movement, and
last weeks story of interference on the
part of Germany with the working of
the Monroe Doctrine In the case OF the
what a certain class of speculators will
do to depress prices. Such attempts to
lower values, however, generally end in
failure.
There was a short period of weakness
last week on the publication in certain
quarters Of Germany's alleged attitude
toward the United States, incident to the
situation in Central America. but a rally
quickly developed as a consequence of
support from the substantial banking in
terests. The character of current buy
ing on declines suggests that stocks are
a better purchase than q. sale, and it also
suggests that the capitalists who for
many months took no steps to stay the
downward movement are now strongly
intrenched in the market with their eyes
focused on a future that will bring
about sustained bull operations. A big
bull market may not develop at once,
but the current course of prices is quite
likely to be in the direction of modest
improvement The foundations of bull
market have been established, and it is
more than likely that if the crops turn
out as well as the percentage of condi-
ton of July indicated. except for spring
wheat, the fall and early winter should
witness a considerable recovery of the
losses recorded since last August,
If money Is stiff IN the autumn a tenn
porary cessation of bull activity would
develop. If a Democratic Congress
should be elected there would Of course.
be a considerable amount of liquidation.
and If the American Tobacco and Stand
ard Oil cases should be decided against
the companies further passing selling
would take place. but based on the opin-
ions OF many of the leading interests in
the financial community, men who take
a long time view of the situation. stock
market prices eventually will be at 8
level that will make prevailing quota
tions appear exceedingly cheap There
are no indications that money will be
dear before the fall, If then, and with
easy loan accommodation in the next
two months something in the nature of
a, bull market should be seen before Sep
tember. These ideas on the outlook
nevertheless do not warrant any one in
loading up with stocks on small mar
gins. There has never been a, bull move
ment when light margins have been
justified. People who can afford to buy
for cash can do so with the utmost
confidence that their funds will be well
secured People who want TO buy on
borrowed money should proceed on the
conservative theory, even when prices
apparently are at the bottom. that prlI-
dence and due regard for their best in
terests demand a margin of at least one
half of the purchase price of the secu-
rity. If this policy were to be adopted or
made compulsory many commission
houses would be compelled to retire from
business; but the welfare of the public
would be better conserved, while the
credit and good name of Wall Street
would be substantially strengthened
Sterling exchange has declined to a
point that should attract a large amount
Of gold to New York from abroad. and
if in the course of the next two months
our bankers take advantage of exchange
market conditions to bring in gold in
small weekly amounts, bank reserves
will be in q condition in the fall to
handle the usual autumn strain upon
their resources without the accountant
ment Of disturbance in money. This is
the time to bring in the metal If the
operation is postponed until later in the
season foreign bankers will put up the
bars against us. or at least place such
obstacles in the way of an outward
movement from their shores that re-
ceipts here will be of unimportant pro-
portions. Our foreign trade is improv-
ing, but not at a rate that suggests an
important balance in our favor in the
near future.
Moreover, We cannot count upon a
heavy increase in our exports of grain,
for the good reason that visible supplies
abroad are large, while the crops in for
eign countries promise to be unusually
favorable, to say nothing Of the in
creased home demand for CONSUMPTION.
For the month of June exports of mer-
chandise from this country amounted in
value to S127, 1863, ,263, an increase of S1O.-
1864 over the same month last year,
while in the same time imports of mer-
chandise amounted to S119, ,6S2, $40, a de-
crease of 81. $50, ,1S4 from the record OF
June, 1909, the excess of exports being
in value SS,1S6,31S, compared with an
excess OF imports a year ago Of S7,245,-
$40, and an excess OF exports Of S23,-
n