New-York tribune., 1918-07-09

Stock prices declined yesterday,
not because of any great selling
pressure, but rather because no one
seemed particularly anxious to buy.
For lack of q better explanation
Wall Street said that the absence of
buying power was due to the hesita-
tion of traders to increase their COM
mitments in the face of the expected
renewal of the German offensive on
the West front. AS result, the
market seemed very thin and prices
at times gave way quite easily. At
the close the leading issues showed
losses of point or more, with an
extreme decline of Az points in
American Sumatra Tobacco, one of
the volatile specialties. A market
such as that of yesterday is not much
Of a measure of sentiment. It de-
notes hesitation on the part of the
traders, but little more. 1t would be
interesting to know just what pro-
portion of the trading now is pro-
fessional. Nincty-tive per cent would
probably be fair estimate.
Western banks are being advised,
according to our Chicago correspon-
dent, to draw down their New York
balances and employ such funds in
the purchase Of bank acceptances.
Federal Reserve Bank officials in the
Chicago district are said to be advo-
eating such move, pointing out
that a shift Of this kind would be
advantageous and profitable to the
banks. Inquiry made in local bank
ing circles yesterday indicated that
deposits at this centre to the credit
of Western institutions are not large;
in fact, in many cases no more
money is being kept on deposit in
the East than is required for work
ing balances. 1t is not unlikely that
many banks in the West have al
ready seen the advantage to be de-
rived from buying bank acceptances.
In fact, the increasing demand from
the interior for such bills indicates
that this form of commercial paper
is rapidly growing in favor all over
the country. Bank acceptances,
which are eligible for discount at
the Federal Reserve banks, are con-
sidered the most liquid form of in
vestment that a bank can make,
fact which is becoming generally
recognized.
The "buy bale Of cotton" move
ment has come to life again, this
time on a grand scale. Southern cct-
ton interests are the sponsors. They
propose, with amazing frankness, to
have the United States government
buy for its own account all such cot
ton as may be offered for sale with
out other available buyers at price
to be fixed by the President. The
movement has reached the stage
where resolutions have been passed
in New Orleans to recommend to
Congress the enactment of such leg
islation, and special committee
consisting of one banker and one cot
ton producer from each of the states
in the cotton belt is to lobby for the
measure. The move is not at all
surprising. The South wants to sell
al! Of it's cotton, and at the best price
available. 1t will be recalled that a
few months ago, when cotton prices
scared to 35 cents a pound, talk of
price-fixing brought violent protest
from Southern quarters. The mar
kct should be left to take its own
course, it was insisted. But since
then cotton prices have sIumped
more than 10 cents a pound, and now
the South is faced, according to the
governments own estimate, with the
third biggest crop in it's history. The
fear is now expressed that a huge
production at this time would prove
an embarrassment, because it could
not be readily marketed and might
have disastrous effect on cotton
prices. So the Southern growers ap-
parently think they have found
solution. Sell the surplus to the gov
ernment, and if there is any loss to