The Washington times., 1912-09-08
MARKET OPERATIONS OF THE WEEK
ORIGINATED WITH ROOM TRADERS
Developing
Bull Market Crop and Business Outlook by Politics
Conditions.
JOHN GRANT DATER.
Special Financial Publications

, itself has the tendency to relax the
throughout the entire interval, call
money toward the close displayed an
easier tendency, showing that the ma
tural process of adjustment was al
ready In play. Easy money, of course,
is not expected and in fact bankers as
rule look for well maintained per
cent rate. before the autumn is far
advanced and the crop moving demand
Is over, but this is a rate, they be
lieve, that will entail no great hardship
upon commercial borrowers, while stock
spectators will have to wait Until a
later period for the return flow Of
funds II they would operate with any
assurance of safety.
Foreign Borrowing-Bank Statement.
That the money market was working
along the old familiar lines was evil
denced by reported heavy loaning In
the market by out of town institutions,
and by what was more significant, a
pronounced decline in sterling exchange,
showing that Europe had not closed her
doors upon our borrowers. In fact, the
English and the Continental markets
will not decline American bills, If drawn
against commodity Shipments but they
have shown, and II is expected that
they will continue to show, a dislnclina-
tion to provide funds for speculative
undertakings. However, there were
some rather extensive negotiations of
finance bills abroad, and the proceeds of
these loaned In the market provided for
legitimate needs without further ad-
vancing the time rates, which seemed
! likely at the outset of the week Still
| 1t is not to be inferred that money is in
any very liberal supply, for that Is not
the situation.
The bank statement of Saturday con-
firmed In every way the Streets theory
Of an enormous shifting of loans be-
tween the local banks and out of town
| institutions. That process alone would
explain such changes as contraction
| of $2S. Ole, 900 in loans and a loss of $50,
| III 900 in deposits disclosed IN the report
giving the actual condition of the clear
| ing house institutions. In other respects
the statement was again more unfaNor-
able than brokers expected, as cash
| holdings decreased 1000 and thc
surplus reserve was reduced A,S02, 900
| A reserve of only s., ,75l, 100 above legal
requirements in the New York banks in
| the first week of September is not a
pleasant thing to contemplate, fol
| enormous demands are yet to come. lr
| fact. one may almost say that Wall
Street Is to be congratulated on the low
| estate of the speculative market. for an
! expanded position would spell disaster
Liquidation In. Bonds.
In the bank statement and the money
| market you find a ready and a salts
| factory explanation of the liquidation
| which occurred during the week ir
| high grade bands and notes. The feature
was sharp decline in New York city
| issues, the new AZ per cents which were
| sold in Nav at an average price o.
| 100. "A breaking to 997s. Clearly the de-
| cline was due. at leaS st in part, to Sellins
| by banks and trust companies in al
| effort to fortify their reserves. Othc
| high grade bonds participated in the de
| clnes. This Is, of course. disQuieting tt
| numerous investing institutions, wh'
| lose through depreciation, but on
| should not lose sight of the fact that /
| is highly favorable to new irvestmen
| operations, for the best bonds in the
| country have not been so cheap as d
present in many years.