New-York tribune., 1918-01-25

The impending government loan is
already beginning to cast its shadow
over the security markets, even
though nothing definite as to the
terms of the issue has been an
nounced. The Secretary of the
Treasury is quoted as stating that
"the government faces the necessity
of raising $4,000. 100000 between
now and June" and it is assumed
that he meant $4,000, 100000 would
be raised in the next five months
through the issuance Of securities.
In addition there will be something
overS3, 900, 100000 to be paid in taxes,
making $13,000,000, 900 in all. 1t is,
as a matter of fact, doubtful if the
necessity for raising such vast sum
exists. Almost seven months Of the
fiscal year ending June 80 next have
elapsed, and expenditures of the
United States government, excluding
the retirement of obligations issued
daring the year, amount to $6,OO0,-
100000 in round figures, more than
half Of which consists of advances to
cur allies. In the current month ex-
penditure will probably be slightly in
excess of $1,O00,000, Thirteen
billions would provide for eXpendi
lures at the rate Of $500, 100000
month during the remainder of the
fiscal year, with a substantial bal
arce to be carried over. 1t is SEEM
lngly impossible for the government
to spend so much money. especially
as productivity will be at Il relatively
low point during a substantial part
of the period Nevertheless. it is gen.
orally realized that the most gigantic
financial operations in history are to
! be conducted in the course of the next
! five months. and under circumstances
nCi so propitious as had been hoped
for. This would be sufficient to re-
strict activity on the Stock Exchange,
NN Cll WClC OllC OttLlOOh III OltlCI UIGCC-
tions less uncertain than it is. That
is probably the chief reason why
trading is so dull. Only the profess
sional speculator is willing to VEN
ture into the market now. 1t also
accounts for the fall in the 8 1s per
cent Liberty Loan bonds to 90, new
low record, yesterday.
At the end of the first hour of
trading yesterday only thirteen rail-
road stocks had appeared on the
tape. while some of the industrials
which are frequently the medium of
active speculative operations were
not traded in until after II o'clock.
1t is commonly believed that the
''public' always buys stocks at the
top and sells them at the bottom, but
reports showing the number holding
stock Of the Pennsylvania Railroad
and the United States Steel Corpora
tion-the first long regarded as the
premier investment stock of America
and the other the greatest medium of
speculation on the Stock Exchange
give testimony tending to refute this
belief. When Steel Common reached
its peak last spring there were less
than $4,000 stockholders. The price
declined steadily almost throughout
the balance Of the year, but the num-
Der of stockholders at the end of the
third quarter showed no important
increase. At the end of December.
however, the number had Jumped to
more that 81 900, thus suggesting that
there had been Il rush to buy when
quotations were at the bottom. The
Pennsylvania reported an increase of
more than 10000 holders on the first
Of this month, as compared with Oc-
tober, 1916, though meanwhile the
stock had dropped more than 1S
i,ointc