The Birmingham age-herald., 1911-07-09
AND WAR ...\E FACTORS
Wall Street Affected By the
 Annual Explosion
BANKS FULL OF CASH
Street Had Its First Crop Scare Last Week But It Did Not Last Long-Effect of In-
 vestigations
Bx ". c. NICHOLAS

New York July S.-(Speclal)-The hot weather in America and little war scare abroad were the things which ap peared to influence prices most this week. tAsrsese war scares are of annual recur- \ renee. They come about the time the necessities arise among the old world na- tions to raise money for the maintenance of their grotesquely over-extended mili- Irfary establishments At such times it | gas found expedient to arouse the patriotic feelings of the people so they will not grumble so loudly over the imposition of taxes to keep going the huge armies and | navies. These annual explosions have | become almost routine in their regularity and in the uniformity with which the machinery is put into motion. After the money for the ensuing year has been provided for, the manufactured excite ment dies out and matters proceed as usual. It might be remarked also that |'Ahot weather and drouths are of annual recurrence much to the satisfaction and profit of a horde of professional crop | killers and of the spectators who hire them.
 J At may seem to the uninitiated an ab-
 slldrdity that little rumpus over a jim
 qyrow desert country like Morocco should heffect prices the New York Stock Ex- | ehange, but it docs nevertheless. It throws lnore or less of a scare into the money and securities markets of Europe and they begin to convert speculative hold ings into cash. The first thing they think of selling are American stocks and bonds
 L-secause there is always a quick market for them. It thus happened that for sev- eral days this week there was a steady Anx nf f1ae ap1a sure occasionally being uncomfortaby large. Now it is well known that the great money combinations favor the pro- | xection of the stock market here because, sdpon the maintenance of prices depends E~,te security of hundreds of millions of h ( nars of Wall street collateral behind An enormous aggregate of loans. Any severe break in securities of value OH the New York Stock Exchange impairs the collateral upon which these loans are made and necessitates the calling for more margins and a general contraction and uneasiness in the local money mar ket. Anything of a disturbing nature is therefore regarded with displeasure by the banking interests, which are quite as much concerned over one piece of news from the remote parts of the earth as they are about a crop scare or an earthquake at home. so long as the mat ter of stock market quotations Is involved. | U 1urbaned horsemen on the sands of the Sahara becomes, therefore, matter of international financial importance for the II ymoment and may influence the values of Lf billions of dollars worth of securities for H fieeting moment, quite as much as a crisis in the American corn cotton crops. Curious thing, the stock market, tand the factors that influence prices.
 N'
 Wall street had it's first real crop scare this week and that didn't last long. The weather conditions which were so threat | ening, and which have no doubt done considerable damage in the southwest | and over large local areas in the north- -(west were mtigated as the week drew TX to a close. The damage was pretty well | defined geographically and it's extent measured with approximate accuracy. The crop injury, though severe in locali- ties, will not materially cut into the gross results, it is now believed In almost every department of agriculture crop Areas have been increased this year over recent average years, so that there can be substantial reduction in yield per acre and still be enough to go around This is a consoling feature of a situation which might otherwise be disastrous. 1t is also remarked that in the matter of corn farmers have larger reserves from old crops than is usual and for that req son there is not likely to he any reduc- | tion in railroad tonnage worth taking into nccount, unless conditions get very much tNorse than they are between now and | autumn harvests. ,The government figures Non the cotton crop are being accepted Smore generally at their face value than G was the case when they first came out | These official estimates did not agree with private advices as to conditions in k .the southwest but even with admitted damage in that part of the cotton belt -fi1l 1n11 fnrt1 atca of a crop of at least 100000 bales, with possibility of 100000 bales additional should there be a late fall Upon one | point the burden of information is in ac- | cord and that is with regard to the hay | (crop According to all accounts, that .is going to be short. and as it is third
 Dor fourth in agricultural importance the
 Dloss may make an inroad of measurable i size in the money results with farmers N and railroads. | The banks are still groaning under an | loverburden of cash. It Is the money | which has accumulated by reason of the fact that 1t cannot be used to advan- tage in the ordinary. channels of busi- ness. It is the direct resIlt Of general business contraction and it finds its best employment in the stock markets This is a phase of the situation which has been \ freauently referred to In these letters and 1t still remains the great controlling fac tor in the maintenance of securities values at around current levels. It offers un-