New-York tribune., 1918-11-26
Modification of
Money Restrictions
Seems Imminent
First Relaxation Expected
to Affect Only Bonds
and Notes

The demand in brokerage circles for
revision Of the policy Of the bankers
money committee which was announced
on October "a IN the light Of the sub
sequent momentous world changes ex-
panded into a chorus of pleas for
prompt action yesterday when prices
generally took another notable slump
in the stock market. The money COM
mittee will meet this afternoon, and
1T was ascertained last night, steps
will probably be taken in the near
future toward relieving the loan
markets. The first movement. with the
object Of distinguishing between invest
ment and speculative buying, will affect
only the market for bonds and notes,
1t is understood, but as result of the
declining demand Of industry for credit
during the transition from war to
peace basis a release of funds is looked
for which brokers believe will lead to
ruling permitting the volume of Stock
Exchange loans to rise. above the level
of September 16, which Is at present
the standard to which they must con-
form.
The lifting of the ban, it was argued
by those who urge the change, on ad-
vances to Stock Exchange firms would
in no way njure the credit prospects
OF the government. as the market is
now held in restraint by a more funda-
mental reason than the artificial limita-
tlon-namely, lack of buying power
resulting from the general uncertainty
concerning the Immediate outlook for
business. The factors involved in the
readjustment problem, it was asserted,
would automatically offset any un-
healthy tendency to pile up large
Stock Exchange loan account.
The Danger of Pessimism
Another reason frequently given by
the advocates OF removal of the cid"
was that the total of loans is now back
to the required level and that further
to discourage buying in q reactionary
market such as yesterdays would re-
act unfavorably on the whole economic
and business fabric of the nation
Prices literally melted away under the
pressure of heavy liquidating orders,
the recessions finding no sizable sup
port in the way of buying orders. The
policy of the money committee, it was
declared, was unintentionally playing
into the hands of the bears
All kinds of stocks were affected by
the downard price movement, although
the steel stocks were fairly successful
IN resisting the tendency. Marine pre-
ferred showed net loss of eight
points, and Mexican Petroleum dropped
SIX The leading rails fell off sew
eral points
The stock market movement was
coincidental with a substantial easing
of money rates. The ruling rate on
call loans secured by mixed collateral
was 5% per cent, and on loans secured
by industrial collateral 6A per cent.
The easing of call money rates was
attributed to the lessened demands of
industry on the banks for credit and
also to the status of Stock Exchange
loans, which cannot expand above the
, level of September 16, but which are
subject to contraction as the tendency
of security prices continues downward
Loan Committee Meets
Observers of the money and credit
situation were especially interested d
yesterday afternoon in meeting of the
bankers who comprise the central Liberty
Loan Committee. Although no public
announcement was made Of what took
place at the meeting, it was considers d
likely that the money situation in re-
latlon to the governments financial
needs was canvassed. The Bankers
Money Committee is sub committee of
the Liberty Loan Committee, and is
understood to be cooperating with the
Washington authorities.