The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-11-22
FINANCIAL NEWS
And COMMENT
Preparations for Reopcning the
stock Exchange Bond
Department.
WEN OF BIG EVENTS

made by the chairman Of tho Clearing
House committee there will he no misun-
Outstanding or misnterpretation OF the
changes In the bank statement yesterday.
The exhibit was quite remarkable, par
,icularly in tho item of surplus reserve.
which increased no less than sl69t6.O0O
and now stands AT tho huge total OF
sI16S305iO above legal requirements.
The gain is more apparent than real.
however. and IL the direct result Of the
Inauguration OF the regional reserve
hanks. which require tho setting apart
Of rs per cent or deposit liabilities for
reserve purposes against 25 per cent. as
heretofore
Aside from the lcAns which expanded
about $4,000. 900. and circulation. which.
80 q result of the retirement Of euner-
r~ncy notee, decreased sit.o7s,ooo tho
various items OF the bank showing are
impossible of comparison. and conjectures
a. to the actual increase OF cash and
how Il has been distributed among the
institutions are idle Money II undues-
torr,bly accommodating AT this centre, as
ls evidenced by tho relaxation In time
and call loans and rates for commercial
naper but II is we'll to bear the Clear
ing House warming In mind that the
changes In the methods OF compiling the
hank statement do not imply Charge
in conditions Tho large surplus OF re-
sery, IL not fund awaiting investine 49,
but an arbitrary amount resulting from
n change in percentages, and ono that
will he continued at what may seem
abnormal figures until foreign banking
relations are reestablishcd or until a call
loa,, market is reestahlished with tho re-
opening OF tho Stock ENcllange
Announcements was made during the
morning that tn" committee when mas
charge OF Stock Exchange AFFAIRS would
submit to the governors Of the exchange
mex, week a plan for reopeniug the bono
lepa-tuent TO broader dealings than have
been possible under the restrictions which
have prevailed. This was taken as an
Indication that tho difficulties when had
In the middle Of the week checked the
movement for reopening the bond depart
men. were not obviously insuperahl". as
necially a. according 20 the announce
ment the plan was to be put In operation
az nm early date II tho board OF gov
ernors approved a.
The movement 10 this end was one ~
.he most significant features OF financial
Developments In the last Few days. Il
showed how great a change had taken
Mace in banking attitudes row mat
he Federal reserve banks had been
opened and every other department OF
the country's commercial and financial
machinery had been restored 10 working
order except the Stock Exchange. The
indications clearly are that the present
financial disposition Ia one OF determine
lion to ind way for resurning bust
ress in the couutry's primary market
for capital and 20 regard the stock EN-
change reopeninE AS an experiment which
must he courageously ventured SOONER
W later and therefore, the sooner the
H. 70 h..er In
a continuing process of adjustment 20
the conditions created ny the European
war.
With something IKE three score listed
stocks selling AZ or above the closing
prices of July 80, and with bonds al a
rec VERY of fully half Of the decline which
was precipitated hy the war the position
nf securities Is conducive to the expert
mont So also Is the banking situation
The Federal reserve banks are now able
20 furnish Il largely Increased capacity
~ credit to accommodate strain in any
quarter even though collateral security
loans cannot get into the reserve insti-
.ut!ons. For largely increased resump-
ton OF regular dealings In securities
facilities for the restoration OF the call
money market have been needed, and tho
fact that banking interests indulge EFFORTS
10 resume more o. less regular bond
dealings on the board IL proof of COM
Portable monetary conditions. Moreover,
The call loan rate has been falling and
new loans have been negotiated At ~.
per cent
propitious The Federal Reserv" BOARD
in confronted with the problem or de-
Gliding whether or not to lower official
a scount rates so as to encourage reds
counting The open money market rates
suggest indeed that the banking commu-
nity as A whole II nnd,rE Increasing d!f'i-
H., zoe isG
has there been any unfavorable action
IN the principal form ~ foreign exchange
which concerns US most namely sterling
remittance. This has been firm, hut its
frmn-ss has not been ind cative or up
ward tendencies which make the wider
opening of the securities market too
hazardous. The success ~ the BRUSH
Government in floating n war loan OF
sl750. OO0. 600 on about 4 per cent OASIS
the subscriptions for II being apparently
twice ~ much rs the Offering u, more.
over. likely 10 promote British financial
confidence which VIII nave H'lP'"' IT,
fcctlon here.
The opening Of the Federal reserve banks
vas Of course The great amt important
event ot the week tn" fact thai the
initial stages Of Transition from me o."
IN IN, new banking system were accom-
pliehed without disturbance was vastly
reassurlns and although % N'l 10" som"
time beTor. Tho r"scrN" institutions b"
come incorporated INTO IA" country hhsl-
ness structure bankers ana business men
cveryWherc have taken heart from the
knowledge th1t 50 much potential SUI
port has been placed undor volumes ANA
values
The opening 81 o., cotton EXCHANGES
WAS another signal "N,ut Iud its crafty
ing implications We're emphasized by the
quiet way i'm which trading proceeded and
by the hrner trend which prices displayed