The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-08-25
FINANCIAL NEWS
AND COMMENT
Stocks Advance on Reports Of
Relief Of Tension i'm
Arabic Issue.
BUYING IS CONFIDENT

, hind the advance in the stock market
yesterday. one was the remarkable
power OF resistance to the decline dis
played by the main speculative position
during the stin reaction OF previous days
and the other was the news that Am
hassador Rernstorff had requested on
the part OF his Government a suspension
Of Judgment upon the Arabic incident
Until Gcrmany's side OF the case was
heard. The second obviously furnished
tho hone that Germany was prepared
TO back down and thus clear up the
whole matter. Until these later reports
were received the advance appeared to
on technical ground plus buying by
those WHO were waiting a chance TO get
In on q reaction.
IT j. true tina; his recovery was
made upon buying Of an unusually con-
hdert kind. but that might nave re-
suited from a speculative position OF
great strength rather than any fore
knowledge or expectations OF the way
the Arabic incident might turn out The
attitude displayed by Germany. made
known in the afternoon. however, re-
liev,d the political tension and led 10
= precipitate retreat OF the short in
toreSt and to an equally hasty replacing
Of speculative holdings sold by i'm
portant interests on the decline.
The evident Improvement in the
diplomatic situation was quickly re-
fected In the market. II not only caused
a vast amount Of new buying by pros
receive spectators who had been wait
ing for the political outlook TO clear he
fore getting In but II led 10 r~epircnases
by SPECTATORS who had sold out On the
previous rise and by spectators who had
ought; at the bottom and taken profits.
believing that the recovery was all that
could be exp 'cted for he time bein., IN.
der the circumstances An il~lus.-atto on
OF the almost unprecedented vote face
that has taken place In the speculative
position In the past few days Ls con-
Jared IN the action o. several big >, ok
iS">.s who bought oak stock yeste--
day az or very near the same prices at
which they sold out on the decline. in
deed. from the swiftness OF tho re-o'i
ana the scarcity Of stock on the adj
vance II IS evident that much II these
sNecu!ative holdings could not have been
replaced at all. In other words the ur-
'Npecled strength developed by the spec
dIdtlNe. SITUATION ami the rap.lI,, ~
the chang in the i;.co caIsa, ,
-ood many %speculito~ TO lose their
market entirely. When the news came
out the only nance for them wa. n
yny back their stock In competition y.i:a
th' whole community
nut while the change In the political
outIook mus be accorded its full sha-a
OF responsibility for the rise In the mar
Net me main cause for the Improvement
must not-be overlooked This was. as /,
mas been all along, the conide nee Of
me public In the future OF the mark.,
WIN the pubI.c and the financial dis
trlct also II was never a question ~
whether or noe stocks should h. houcb,
on tn. break. ou; the precise moment
when they should lie bought. In o;he-
words when u became apparent that the
p ition had seer clea ned
out ard prepared for the worst new
bui1nE Immediately appeared.
To put 1t in another way. Il il evil
dent that nothing could have saved
prices from an even worse break IL ire
main public. as distinguished from Wall
street as the term Is used In its mar
row sense. had been frightened into
~ H'lilUENs f'V1 tnls point
Of view the resistance OF the stock mar.
Ret last week and on Monday was even
more significant than the strength yes.
terday. T.e former phenomenon mad
nothing behind 1t except the confidence
Of the country in the fUture OF the
market and the public desire to specu-
late. even when confronted with the
probability ~ 1t least a break OF diplo-
matte relations win Germany. The later
dcve!spment OF strength had an obvious
and tangible cause in outside develop
ments.
Little attention was paid 70 develop-
ments without an immediate influence
upon stock prices. The plan Of William
- McAdoo TO deposit $50. 200. 600 or
more gold viii the Southern banks TO
help finance the cotton crop was gen
orally criticised IN banking quarters as
an unnecessary and unjust step. appar-
emily conceived from political motives
pure and simple. \ more important con-
s!derat.on To the cotton trade was the
reyor; ;hd' the British Government
would permit cotton shipments II they
came within the normal consumption OF
neutral countries.