New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-08-03
NEW YORK THE LAST
TO QUIT UNDER FIRE
Foreign Exchange Market in a
DemoraliZed State - Gold
Goes Out by Millions.


ton bv Austria of Servia's answer TO
her ultimatum the vision of Arranged
don appeared. Events in the next few
DAYS followed so rapidly and bewilder-
ingly on each others heels that there
was no Gppraising them. What they
meant no one could say with certainty.
The idea of q general European war,
involving, besides Austria and Servia,
Russia, Germany, France, England and
Italy, seemed too trsgically grotesque
70 be credible.
Il was the feeling that all the Euro
pean nations at one snother's Threats
was a thing so monstrous that 1t could
never become reality which was re-
sponsible, in part, for keeping open the
New York Stock Exchange until Friday.
Not even when the Balkan war broke
out had Europe so deluged this market
with stocks and bonds. But the belief
was strong that the selling from
abroad was close 70 its end. Foreign
bankers and investors, in the view Of
nearly everybody in Wall Street, had
merely lost their heads for the mo-
ment and were likely TO regain their
senses ct any time-as soon as the
Kaiser could confer with the Car or
the invitations sent out by Sir Edward
Grey for peace conference in London
could be accepted. At the worst, it was
thought, the war would be localized,
and Austria's declaration that she
meant to respect the territorial integ-
rity of Servia was hailed as the proof.
The event proved, however, that the
hope was ill-founded.
Foreign Exchange Jumps.
In Europe startling developments
IL o,,I faof hut Horo AhaTa W a.
no evident trouble at first except in
the foreign exchange market. Gener-
ally unfamiliar as people are with the
workings of that intricate orgsniza-
ton, little attention was paid to the
rise of demand sterling bills on Mon
day to the unprecedented price Of
4.9li2 or the engagement for export
of 100000 in gold. The stock mar
ket held up well under heavy foreign
selling, and there was no disposition
70 think anything Of affairs in Europe
with relation TO this country except
that war might stimulate the demand
for our foodstuffs. The next day Aus
tria made her formal declaration of
war, accounts of Russian mobilization
were confirmed and IL became known
that Germany had refused to take part
in any plan for mediation. The Euro
peau bourses were demoralized and
foreign selling of stocks here was more
urgent than ever, between $4,000 and
$4,000 shares being liquidsted on Euro
pean account. The local stock market
reflected the pressure of the outpour-
ing with heavy declines throughout the
list. but except in the case of Canadian
Pacific, which fell nearly 20 points, the
losses were scored in orderly fashion
and there was a notable amount OF in
vestment buying.
EurOpe's Heavy Sales.
Gold exports continued to be heavy,
the S7,000,000 of Monday being sup
plemented by more than twice that
amount on Tuesday. Still, the conse-
quences of the great disturbance of in
ternational banking relations were con-
sidered but lightly in Wall Street, and
on Wednesday, with Europe pressing
her stocks for sale here in even greater
amounts, with an additional S4,500,000
of gold engaged for export, with ster-
ling and Continental exchange practi-
cally unobtanable and with insurance
on gold shipments at a heretofore un-
heard-of price, the stock market closed
higher. Almost every security market
in Europe was by that time closed or
the trading was so restricted that New
York was the only really open and free
market in the world. By Thursday,
however, the market had to pay the
price Of its costly forbearance. Ger
many's demand on Russia for an ex-
PLANTATION Of her mobilization OF troops
was the cause generally aseribed for
the collapse Of stock values that oc-
Cured that day, but il was inevitable
NLoN the do
cision of the governors on Friday
morning not to reopen the exchanges
doors until quieter times should come.
All Markets Closed by War.
The end of the week found security
markets closed everywhere; discount
rates Of all the great European banks
at figures not seen for forty years and
more; Russia, Germany and France
mobilizing and England on the point
of concentrating her armies, while her
fleets were being disposed strate-
gically; the foreign mercantile marines
recalled from the high seas or kept IN
harbor, ana all the thousand and one
preparations going forward that por-
tend a great war. In this country the
bankers and the administration
Treasury Department, Senate and
House-were cooperating to check the
outflow of gold and to provide the nee
essary funds for moving crops such as
were never known before.
While Europe is occupied with her
wars the United States is busy with
the arts Of peace. Trade generally is
improving. Railroad earnings are gain
ing. The basic steel business has
shown a better tone. The earnings OF
the United States Steel Corporation
for the second quarter Of the year were :
81 SOC. 900 better than was expected,
and prices since the beginning OF the
new quarter are higher. The crops
have suffered some damage, but they
are still bumpers, from wheat to cot
ton.
Rate Decision Comes Down.
On Saturday the Interstate Com
merce Commission handed down the
long awaited Eastern freight rate de-
eision. With no stock market IL Will
he impossible for a time TO learn what
the popular verdict on the decision is.
Few persons in the last three or four
months have held 10 the idea that 6
full average 5 per cent increase was
"a be granted TO ali the applicants.
The commissions rulings, in fact, do
not differ greatly from the predictions
current in Wall Street up TO a week
ago. which were generally held favor
able. IL was thought that the roads In |
Central Freight Association territory |
would get all they asked, and that the !
Eastern roads would get but little, II |
but that ways would be
pointed out TO them IN which they /
could add TO their revenues. And In
brief that is the commissions decision.
az L.4a.... - ahn financial cnmmunlfY |