The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-02-16

aHhe shoulu be more obvious than At
present. when they are being estimated
| chleny In terms Of sentiment.
II Will be remembered that there was
last July something In the way Of none
| tary RELIEF from excessive strain and some
Improvement In the security markets cor
! responding remotely to the phenomenon
| which Ia now being witnessed at home
| and abroad. II will remain to be seen
from tho spring and summer onsequencee
or the midwinter Transformation Of flnan-
cial aspects what degree Of enduring bet
terinent was testified to last month. II 10
| difhcult at the moment to tell what the
SITUATION In money and the rebound in
securities signify Of forward bearing. Tbs
relief wrought by liquidating processes
extending through more than a year, the
classical recoil Of quoted values from ex-
| treme depression, the revival Of hopeful
sentiment promoted on various accounts
and by various causes. the reduction Of
borrowing demands incident to the forced
contraction Of trade and industry have
| all combined with seasonal tendencies
| toward money ease and business dulness
TO make the Interpretation Of the financial
markets more than banning. The cate
gories OF money are decidedly confused.
How much Of it, easy position represents
capital available for fixed investment and
| that is. capital which must be kept liquid
for the needs Of . business revival. u .
question Of much importance but hard
to answer.
so far ~ regards the immediate mean
ing VI the security markets. the strength
of prices and the rush Of new security
| offerings, II In to be observed that es-
pecially abroad the markets appetite does
not seem to be tempted by securities at
prices which imply both safety Of prin-
cipsl and Of yield. There seems 70 be
violent craze for issues profSered at
prices which promise a large return to
the purchaser. This smacks disturbinRly
or the developments which not NO very
long ago preceded the revelation of fun
dsmental financial strain because capital
was really scarce. There In no proof
or the abundance Of capital in oversub-
scriptions for per cent bonds offered
at 30 to %. but rather the contrary. Nor
also does IL prove an absorption Of secu-
rites by the ultimate investor instead
81 by dealers who expect to sell to the
| investor at . profit Furthermore the
rapid direction Of money into such in
vestments has not been a characteristic
OF that essential Improvement in the CAP
ital markets which has BEEN the prscur-
sor of . now forward movsmsnS In eco.
nomIc volumes and values AFTER . period
Of crisis and liquidation.
In those times the reassur1n6 Sv1dsanD
or bright prospects for thu future has
been the Investment accumulation Of %.
curities which combined the maximume
| of safety both Of principal and OF Yield.
IL II often said nowadays that the pur-
| chasing power OF money has so dimin-
ished that investors cannot afford to
be too particular and insist on safety
, hrst but this very argument IL a sugges-
| ton that the economic extravaganza Of
| recent years has not been cured. 1t 10 the
same argument used To foster the fota-
ton In the last two or three years OF
| a mass of more or less unsafe securities.
In bygone days. when safety first was
| the motto OF the investor. II was invari-
ably the case that society had just been
compelled TO learn that the homeiy vir-
tues OF thrift were the surest mainstays
| OF general prosperity and the practice
| OF economy In subsequent years made
| safe returns On safe investments quite
sufficient for the needs OF income
| The January Notation OF new securi-
ties In London aggregated seal. 400. 600.
\ which was new record for the month.
IT would not be surprising II before long
| we should begin to hear from abroad
| that the pace Of new security promo
tons Was overtaNing the ability Of the
| investment demand to keep up with Il
and that there were again signs OF con-
gcstcd conditions I'm the investment
market All that has taken place SO far
has been ahead OF any very pronounced
activity in the direction OF new financ-
Ing in France and Of that there 10 a
great deal to be accomplished. Mean
while there are other tokens that easy
! as III. money market has become It has
its limitations. There is something like
a scramble on for all the new South
African gold laid down In London and
the Continental inquiry has forced the
metal To premium. European advices
In the last few days have had an under
tone of suggestion that there were pos
sibilities OF very sudden tightening IN
money In consequence OF the cumulative
effect Of the heavy burden Of new Sc
curities which are being thrown on the
market for absorption. The situation at
Paris seems to be improved on the sur
face only and rates for capital are high
as compared with rates for credit at
all European financial centres.
The European security markets have
been displaying some inconciusive reac.
tionary symptoms. and the Wall Street
share list has been holding around rela-
lively the same price level for more
than three weeks. The same Is true Of
the domestic bond market and both In
bonds and stocks quoted values have
seemed to show 4 little heaviness al
though no trend could be imputed TO them
Their most unbeatable feature has been
contraction In the scale Of dealings. The
southern Pacific offering OF SIS. 10000 Of
per cent. bonds at par directed attention
to the costliness Of capital IN a credit
market which is supposed 70 lie cheap
and the general railroad problem was
further emphasized by various matters.
including the task Of recognising Rock
Island affairs. the reopening OF Govern
ment inquiry into New Haven history
the Federal suit to divorce the Central
Pacific from the Southern Pacific ami
more unnistakable evidence furnished by
.he Interstate Commerce Commission that
action OH the Eastern railroad rate
case would be postponed indefinitely.
SO far as regards politics as a whole.
there were gratifying indications In the
Presidents attitude on the Panama tolls
question that the Administration was
awake to the importance OF our foreign
relation. and the domestic political pro-
grammc was modified by signs of a dis
position to move slowly in enactnG new
AVS for the regulation Of business. Salts
factory trade information was vouchsa fed
IN several quarters. The United States
Steel Corporations report OF an increase
OF 33l.5s2 tons In untitled orders during
January was an exhibit Of basic better
ment confirmed otherwise by authoritative
statements as to the harder tone OF steel
prices
RAILROAD AND OTHER BONDS.