New-York tribune., 1912-01-15
FINANCIAL MARKET
Banks and Other Institutions
Buying Bonds as a Conse-
quenCe of Prevailing Ease
in Money Rates.


they apparently believe that 1t is a mat
ter of a short time only when the public
will become active buyers on an ad-
vancing scale of prices as a consequence
Of the improvement in the iron and steel
trade, the better situation in the dry
goods market and the ease in money.
On the other hand, there are not a few
observers who believe the favorable fac
tors in the situation already have been
discounted, and that as a consequence
Of the various political uncertainties quo
tations will move to lower levels before
anything in the nature OF sustained
advance can be brought about. In the
larger number of instances stocks are
selling at what may be considered fair
prices from an investment point of view.
Leading investment issues are not re-
turning an especially large return at
prevailing quotations. although the yield
is much better than often recorded in
the past and probably above the aver
age, and much better than that which
can be secured on savings banks de-
posits.
In the last week there was no indica-
tion of important investment buying,
outside of that supplied by the large
financial institutions which found it
more profitable to invest their idle funds
in securities than in the money market.
The Equitable fire retarded speculative
operations to only a small extent, owing
| to the action of the Stock Exchange au-
thorities in suspending deliveries in the
case of contracts involving securities
locked up in the vaults, but of course
the destruction Of the big building nat
urally served to impede financial trans
actions and TO cause inconvenience to
the financial community TO an extent
never before known in modern times.
Fortunately the securities taken from
the vaults thus far opened lave been
found uninjured. and there is no reason
to suppose that vaults yet to be opened
will disclose anything in the nature Of
damage to their millions Of dollars of
certificates or that in the final summing
up of the effects Of the fire any one will
be shown to have lost money, except in
respect to the loss on Office furniture.
records and a temporary disorganization
of routine business.
To a certain degree speculative inter-
est in last weeks stock market was CEN
tired upon the shares of the anthracite
| pectation Of a melon cutting by the
| Lehigh Valley, and its later fulhlment
in the form of an extra cash dividend OF
| 10 per cent, calling for the disbursement
by the company Of $6,0G0.OO0 on the
stock outstanding. Subsequent to the
declaration of this dividend the directors
of the Lehigh Valley Coal Company,
which Is owned by the Lehigh Valley
| Railroad Company. authorized the for
nation of the Lehigh Valley Coal Sales
Company. TO take over the business of
! transporting and selling the coal mined
! by the Lehigh Valley Coal Company in
conformity with the federal law. Hold
ers of Lehigh Valley, of course, are ex-
pected to subscribe TO the stock to the
amount of 10 per cent of their stock
| ownership instead of taking the 10 per
cent dividend in cash. The fact that
Lehigh Valley cut melon" naturally
suggested to the speculative element in
Wall Street the possibility of melons"
| by other anthracite companies. except
| the LaCkawanna, which made a distribu-
| tion TO its stockholders two years or
more ago. There are some reasons,
however, for the idea that owners of
Reading shares who may be looking for
ward to a large extra dividend payment
will be disappointed. Even the Lehigh
Valley melon" did not come up to the
optimistic expectations held by many
traders.
There has been some foreign selling "
our securities in recent weeks, and 1t is
worth noting that the foreign situation
is not altogether satisfactory. Never
theless, local bankers have been lending
money to London, they are not with
drawing credits still uncovered by loans
will place no obstacle in the way Of
shipments Of gold abroad AS a matter
Of fact the extreme ease in money rates
here the advancing tendency of discount
in foreign capitals and the wholly legiti-
mate and natural desire on the part of
our bankers to find a profitable outlet
for surplus funds doubtless will force an
outward movement Of the yellow metal
unless a radical change takes place in
our monetary conditions. The highest
price for demand sterling in more than
year was recorded In this market last
only slightly under that level, the
strength being due to the accumulation
OF funds in this market the resultant
decline in loan rates and the firmer quo
tations in London. Labor troubles in
England also had something to do with
the strength in exchange, as exports OF
cotton, and to certain degree other
merchandise were interfered with. caus-
ing a reduction in the volume of COM
modify bills offering.
Money continues to move to this point
from the interior in volume. The ease in
the money market does not reflect acute
depression in our industries but an ac-
cumuation OF funds in the last year.
when trade conditions were slack, when
there was practically no general demand
for accommodation, including an alb
sence Of borrowing by corporations on
new security issues, and when new gold
constantly was being added to the