The Cairo bulletin., 1910-11-07

IDENTITY predicted in the early part OF
the Year, especially by London, has
not mate-ialized; nevertheless, the
immediate course E-rut without its
pitfalls, An unWelcome feature y
ne continued excess of loans over
deposits, indicating that the banks
are lending upon their capital and
surplus. This weakness may disap
pear in due time, but it is a cond.
ton which requires watching, being
a symptom OF oyerexpansion OF
credit. Western bankers are less
confident OF escaping money
squeeze tran three or four weeks ago,
and 1t is quite possible that they
may be Obliged to call upon New
! York more freely for their balances
Stiff rates may be expected for the
balance Of the yeas The government
has also been withdrawing funds
quite freely, the result being that we
may expect a continuance of low
bank reserves at least until funds
begin to return from the interiof.
The only cure is a further reduction
in loans; and the higher rates for
money recently prevailing suggest
tendency in that direction. There Is,
I however, no reason for serious con.
Germ regarding the money market,
the probability being that moderate
liquidat on and a steady contraction
Of loans for few weeks would prob.
ably aectify the situation. Condi-
tons abroad are not unfavorable to
4 this center and there has been con
siderable placing of American finance
bills abroad by borrowers OF the high
est standing. For some time past
there has been growing tendency
,among the banks to loan upon non.
liquid collateral, and this is a prac
tice that should be promptly discour
aged.
The Business Outlook
In the general business situation
| there is little change. Confidence
has received considerable stimulus
from the fact that the farmers are
4 having anothcr good year, but In
nearly all departments of industry
there is a spirit of hesitation which
still keeps the volume of business be-
/, low year. ago. The question of cost
continues to be the great problem IN
all lines Of business, not only among
consumers, but equally with proda
GERS and distributors. Many staple
! articles of commerce have shown a
declining tendency which is hopeful
and suggests that the country is on
J the way to readiustment. Declining
, prices do not usually stimulate bust
| ness until it is felt settled level has
! heen reached AS soon as this IL
, realized we may look for more &C
V tivity in trade. There is already a
} better feeling in the iron trade as
. result of the readjusment accomplish
3 ed there. Cotton goods also have
6 been moving more freely for similar
e reasons. Commodities prices arr
v showing a declining tendency which
4 should be encouraged, as that is thu
]. surest way of restoring equilibrium
+ and reducing the cost OF living, whicf
9 is the basis of much present unres
S and depression Our foreign trade i
{ showing better conditions as a resul
: of lower prices for staple commAt
e ties. Curative processes are steadll
!. at work, and if nothing occws t
y cause q fresh impairment of conf
9 dence some Improvement in bushes
s conditions should develop at no yer
,, distant date.
VI Market is Strong.
Il The technical position of the stoc
% market is strong. Securities az
} coneer tra'ed n strong hands, an
It unfavorable conditions appear t
2 have been fully discounted In som
ie respects the situation ID favorable t
t, bullish manipulation, and while th
e general outlook Is not in all respect
II as satisfactory as could be desired,
e would cause no surprise If the effort
0, on the part of the big interests for
ID further advance were continued no
s that political agitation for the pre-
in ent election has run its cours
$ Nevertheless, the market situation
Zone that requires caution in specul
Of tive transactions
& HENRY CLEWS.