The Washington times., 1913-06-08
IN LOCAL FINANCIAL CIRCLES
By GEORGE h. GALL.

| a blessing in disguise. The quiet liqui-
dation and downward tendency OF
values OF investment stocks and bonds.
which has been In progress % prasaeai,y ny
Wednesday last in q severe break In
market values and forced liquidation in
considerable volume. Europe is esti-
mated to have sold upward Of 1o0, 600
shares of American stocks. and the
throwing over of these heavy holdings
at time when the strain on the Wall
Street market already was almost at
the breaking point undoubtedly accel-
Grated the downward movement OF
prices and uncovered stop-loss orders,
which added to the tension.
The point was made that the reason
that our securities have been returned
to Us In such quantities is because the
New York market offered the best IA
cilities in the world during the recent
worldwide money congestion for the
liquidation of stocks and bonds on a
satisfactory basis"
"One Of the outward signs which
usually indicates the near approach
of a change for the better is the pres
ence In the financial district Of those
who buy only when sharp declines in
prices offer special inducements. IT
Is an open question whether buying
OF this kind can vet be fairly regard-
ed as having become the dominant
feature of the market. but IL has at
least become one Of its noteworthy
phases.
Doubtless many among the ranks
OF those who bought stocks outright
this week were actuated by belfef
that at current prices a number Of
seasoned dividend-paying issues yield
returns which cannot be expected to
remain Indefinitely as high as they
now are. In some instances. OF course,
the market has taken into considera-
ton the possibility of dividend reduc-
I..A IL. Ia
issues which would be more or less
generally regarded as under this in
fluence the yield on many stocks may
reasonably be described as abnormally
high. A fact which helped to induce
purchases bv those who are attracted
TO the market by sharp declines was
that at the low prices the general level
Of quotations have fallen under the low
point Of 1910 and lower. therefore. than
at any time since 1906"
STANDARD OIL Stocks" and "Ameri-
can Tobacco Stocks" are the titles OF
two booklets descriptive of these is
sues just published by the General
Service Corporation. New York.
cial review of Henry Clews & Co,
ascribes the declines Of the past week
largely to the demand for capital at
exorbitant rates. He says in part:
Another week Of liquidation and
depression has come and gone
Values have been generally lower.
and the declines extended to even the
better class OF investments The fall
could hardly be attributed to specu-
lation. Of which there is compare
lively little on the Stock Exchange at
this time-much of the selling evil
IDENTIFY having come from the holders
c securities. The main reason at
present for depression appears to be
monetary tension. The demand for
capital at exorbitant rates and the
difficulty Of placing new issues tend
to undermine the values of even we'll
established stocks. Added to this is
the steady pressure in banking circles
for liquidation, the purpose of which
is to strengthen the situation Of the
banks and to place them in a posi-
ton for convenient handling of crop
and trade requirements next fall
This policy of liquidation has extend
ed to the commodities markets, many
Of which are declining. Iron and steel.
textiles. copper. coffee. sugar. and many
other articles of merchandise appear to
be on the downward grade. AS a rule.
this does not seem to be due to any
oyersupply. but rather to the general
reaction and the imperative necessity
for liquidation. Moreover. this tendency
in both securities and commodities y