New-York tribune., 1910-01-31
FINANCIAL MARKET
Low STOCK PRICES.
Money Rates Easy, but Out
look Does Not FAVOR Year
of LozU Quotations.

Prices of stocks in the last year
reached level altogether out Of proper
ton to the price of money and the re-
turn on investments, while last week the
general average of the leading railroad
and industrial issues declined to point
that encouraged some investment buy
ing and indicated on the surface a SELL
ing movement noe justified by known
conditions governing the actual worth
of American securities Some Stock EX-
change interests assert that the current
shadows the development of an un-
settled trade situation, but outside of
Wall Street no proof can be found that
the revival of industrial activity that
marked the course of 1909 is about to be
followed by business depression. 1t is
true that there is a certain amount Of
unrest among the laboring element. and
that the high cost of living, with the
growing revolt against abnormal prices.
has caused some irreguIarity in business.
Moreover, weather conditions in certain
parts OF the country have interfered
with the distribution of goods and have
ton companies, while false ideas fostered
in the speculative community regard
ing the attitude of the administration
at Washington toward industrial COM
binations have created little uneasi-
ness in business circles over the future.
Fundamental factors. however. have not
changed for the worse. and the larger
number of business men in the larger
number of business centres see nothing
in the outlook that should discourage
capital from moving into American in
dustrial enterprises.
Careful observers of stock market
movements find in the speculative ex-
cesses of the last year the chief reason
for the decline that has been under way
since January l. The sequel of the
gross manipulation of 1909 is found in
the collapse of securities prices, and
from the movements Of the week just
closed market followers are justified in
the theory that the bull manipulation of
recent months is being succeeded by
similar operations on the bear side of
speculation. And it may be well to re-
mark at this juncture that people who
own are practically in the same position
as the operators who bought stocks on
small margins at the high points of 1909.
The market was overbought last year,
while it now appears to be oversold.
The public is not much Of a factor in
speculation at the moment and the lack
of outside buying at current attractive
prices can easily be traced to the fear
on the part Of the outsiders that they
are not even offered gamblers chance
in a speculation that is allowed to de-
velop into the most fragrant sort Of
juggling with prices. The Stock Ex-
change can prevent wash sales if it
makes up its mind to do so. And wash
sales-in other words, fictitious transac-
tions made to advance or depress quota
tions-are the foundation Of Stock Ex-
change evils. Practices that make pos
sible stock market scandals can be ef-
fectively killed, and it is to be hoped
that the present investigation by the
Stock Exchange authorities of the Hook
ing Coal episode will result in the
strengthening of the Stock Exchange
machinery in the interest of legitimate
speculation.
from bear attacks. Stocks bought by
prominent banking interests to prevent
Generalization came out on all advances,
and in the absence of public demand
professional traders exerted pressure in
all parts of the list with the effect Of
bringing actual holdings from sources
where surface indications in the mar
ket rather than underlying conditions
affecting intrinsic values exercised a
preponderating influence Wall Street
worked up a scare over investigation OF
corporations by the DepG rtment of Jus
tee at Washington, and despite reassur-
ing statements from the White House
that nothing was intended beyond the
recommendation contained in the Presi-
dents recent message on the Interstate
Commerce Commission and the anti
trust law, which involved nothing of a
disturbing character, no attempt was
made by the larger interests to estab-
llsh the market on stable basis that
might have appealed to public operators.
Bear spectators found another argu-
ment for lower prices in the Paris flood.
though the markets abroad failed TO
show any unsettlement as a conse-
quence Of the serious disaster at the
French capital Doubtless the destruc-
tion to property in France and the in
eVltable reduction for a time in that ma
tons power Of production will be re-
nected IN the international money mar
kets and result in the withdrawal of
sCme French capital invested abroad, hut
bankers who are well informed regard
ing the financial position of the French
people do not anticipate enormous ship
ments of gold from the United States
Real values in the United States will
rot be lessened because of the affiiction
or the French, and no possible reason
can be advanced for the sale of our
stocks and bonds by domestic holders.
Indeed, at current quotations our high
grade securities are well worth buying
Local bank reserves are strong, and
call money was put out last week as low
as Ia per cent. The fact that money
is now relatively cheap here ENCOURAGES
the expectation of a flow OF gold to
Europe, especially in view OF the prob
ability of q material strengthening IN
money rates at Paris, Berlin and Lon
don and the absence in the local ex-
change market OF a large supply of COM
mercial bills. The money situation at
home and abroad is quite likely to be
complicated as consequence Of the
Paris floods, which some authorities be-
lieVe will rank near the San Francisco
earthquake in the extent of property de-
stroyed. The United States imported
upward Of $100,000,000 gold in the year
Of the San Francisco trouble Last year
this country sent more than that amount
to Europe and South America in settle
ment OF actual balances against US.
without disturbance in our money mar
ket, but shipments in proportion this
year certainly would be accompanied by