The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1910-07-01
MORE EVIDENCE OF
WEAKNESS IN STOCKS
Causes of Decline Are Not Very
Well Developed
GOOD RECOVERY MADE
1t Is Believed That the Decline Is
Caused By the Shaking Out of
Longs Who Have Held on for
About Two Years

surface causes which have been advanced
from day to day, such as the impaired
spring wheat prospect. the reduction o.
railroad rates on the trans-continental
roads, ordered by the interstate commerce
commission and similar explanations.
Deeper causes are indicated and were
sought by inquiries in the financial dis
trict today.
From the high point of last Thurs
day Union Pacific sold today at a decline
of 20 points and from that maximum there
was varying losses through the whole
list of active stocks.
The June advance followed the agree
ment reached between President Taft
and the railroad presidents to submit the
proposed rate advances to the operation
of the new railroad law and the move
ment by the representatives of the great
private banks to secure assents from
great shipping interests to the proposed
freight rate advances.
The violent relapse which has followed
brings forward the operation OF more
general causes, which it was supposed
had progressed SO far toward corrcc-
tion as to pave the way for general
recovery. The stock market of today
and yesterday showed how drastic a re-
adjustment remained to be made.
That the process of correction may yet
have to extend beyond the speculative
field of the market Is an inference that
was common today.
Probable dividend reductions by some
of the railroads were freely discussed
,f H.
stock market The outcome follows the
conviction of the unstable conditions
which were the outgrowth Of the pre-
mature rush of the recovery from toe
crisis Of three years ago.
Starting with powerful artificial slim
ulants for the stock market last yea
there followed an imitation of values In
all directions, the cutting down of the
country's exports, the abnormal growth
of imports, an era of extravaganza in
living and in business and industrial
methods, immobilizing capital resources
In land speculation and irrigation prof.
ects at a time when the maintenance OF
business activity and the carrying on of
enterprises were most in need Of re-
sources.
5 There has been a conviction that eS-
.tensive commitments in speculative hold
ings of stocks which were carried
through the elimination of last years
rise in October have obsinatey held ever
since, in the faith that each successive
downturn lin the market was a simple
reaction destined to be followed by d
resumption of the march of progress.
1t was current belief that market pools
Involved In such holdings were being
liouidated yesterday and today in re-
Spouse to the imperative admonition Of
authorities In the banking and financial
world who believed that the credit po-
sition must be strengthened and pre-
pared for the exigencies of the coming
fall The process proved painful ono
and involved price adjustments. The
ouieter tone in the later dealings was
proof of the relief already offered
The more immediate circumstances
bearing on values indicate apathy in
some respects. The drop In wheat was
accompanied by reports of beneficial
rains in the drouth- stricken district of
the northwest. The Kansas state crop
report was held to give excellent prom
ise for winter wheat
Private estimates of the cotton crop
were held to foreshadow a good gov
eminent report of conditions tomorrow.
More attentive perusal of yesterdays
orders by the Interstate commerce
commission modified the impression of
their inclusive scope over practically
Ali railroad rates. There came the an.
nouncement that some Of the classif]ca-
tions of advances to go into effect on
July would not be suspended by the
commission The superstition that tho
whole of the proposed advances were
projected In the chance Of adoption by
yesterdays orders was corrected by.
this action.
Money on call went no higher than
~ per cent in sympathy with the dis
turbance Of loans connected with the
days, impeachment of margins The sub
etantial recovery and tho strong tone
Of the closing was evidence of the re-
lief afforded by the days purging and
was taken as a promise that the storm
had spent Its force far as the stock
market is concerned. Conditions out
side the stock market, of which its &C.
ton may be a herald, will be watched
with attention.
Total sales, par value. 33,S50,000,
United States bonds unchanged on call,