Tonopah daily bonanza. [volume] (Tonopah, Nev.) 1906-1929, 1912-12-12
DECLARE DECLINE IS DUE TO
TRADING ELEMENT THAT IS LONG
OR SHORT ON VARIOUS SHARES

The decline OF southern Nevada
securities is discussed at length in
the recent issue CT the New York
Mining Age and as the subject is
4 81 vital interest to the people OF To-
nopah, the discussion is given here
with:
! The almost universal decline which
has been underway in the Goldfield
and Tonopah issues during the past
three weeks has created an extreme
/ ly disconcerting condition here in
New York, and those who make II a
/ point Of following these markets
have. naturally, been very much per-
\ turbed over the drastic declines wit
messed. This is not the first time,
/ however. that the Nevada markets
have acted in this fashion, and in
fact on three distinct occasions since
/ 1908 they have had these very shat
tering price depressions without any
particular change occurring in the
mines 10 justify the decline How
ever, this Is 70 be expected in any
market where the shares are con
/ stantly being dealt in and where
there is always a trading element
which is either long or short Of these
shares. Ever since the advancing
market which began in the Tonopahs
On the day that the Belmont company
opened up its new vein and when
the stock advanced from so cents TO
$l2 per share, the Tonopah and Gold
field stocks have enjoyed an advanc-
ing market Several months ago 1t
became evident that not only had
the high prices been reached but
there was a tendency noticed in the
I market for these shares to sell off,
and the drop recently witnessed is
nothing more than a continuation OF
that selling
The next question to determines, OF
course, is, how long 1t will be before
the liquidation can be considered
over and when a resumption will be
in order, toward higher prices. If
history furnishes any kind of a pre-
cedent in this matter il is hardly
likely that the liquidation has as yet
run its course, or, II it has, precedent
also shows that the stocks usually
remain at bottom for sometime be-
: fore they develop an upward rising
: tendency. Furthermore, some very
keen and important developments
! will have to occur to create the in
2 centive for such an advance, as when
the shorts have things their own
{ way, it is not easy to turn about
? and force the market upward again
without the development of very
strong buying power.
The trouble with the decline dur.
ing the past few weeks has been EN-
tirely due to the fact that there has
been absolutely no buying power.
which is due to the fact that the ma
iority of buyers of these shares are
carrying all they want OF them, and
4 as the brokers have been unable to
develop a new buying power all that
the bears have had TO do was to Of
fer shares down and the markets
have crumbled of their own weight.
/, From a purely physical peint of view,
il is a great deal easier as any one
can understand. to stand on the curb
and offer bales of shares to any
one who will buy them on a declin
ing scale, than II is to stand on the
other side of the curb and buy the
Il same quantity of shares. In the lat
4 ter instance it takes money plus
g. nerve, while, in the first instance all
r that is required is nerve backed by
NJ additional nerve. No money what
= ever is needed So it does not take
n any very logical reason TO expIaiI
IL why these stocks have gone down
ID OF course in the long run there Will
n. come a time when all this thing vii
n. have been overdone, and when SOM
Of unknown security will have reached
stage where the directors will b.
in a position to begin making regu
lar dividend declarations then tn
turn viii have come. You see It i
all very wen TO sell stock shor
which does not pay a dividend. bu
when one Of these unknown secur
ties become dividend payers 20
can certainly not abide your owl
- time in covering. as there is, natm
Hi ally. always Il greater demand fo
III dividend payer when il reaches
y a point below stipulated figure. an
il is then that the shorts take
upon themselves 10 cover. aud th
". tables ARE turned
Despite the fact that there wa
very good buying during the wee
In rouupah Merger. the stock havin
rallied at one time from I. ceni
10 Sc cents per share. the mark
seemed Is BE- unable 10 hold the sci
ing which Was waiting on It, an
". strange as 4 may seem most 0f u
- selling was dome bs the shorts Wt
~ aid everything IN the power "a elil
he sfNek aaNn. and is The hmyil
power was not sufficiently lAIl
~ to eoN them into aenistinw from laei
iaeiies The buYlAe power failed
shoe mueh for ia effort IN ma
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