The sun. [volume] (New York [N.Y.]) 1916-1920, 1918-07-15

The partial reaction Of prices on the
Stock Exchange last week with the
revival OF bearish operations caused
misgivings as to the probable char
acter of the market during a period Of
the year when the condition of the
crops is apt to be the controlling factor
in speculation. The situation was
made the more interesting by the pub
LEGATION Of the Governments July crop
figures. the hardening tendency to
money rates in response to the heavy
withdra walls Of Government funds, the
continued activity in general trade
and the efforts of various corporations
to arrange for the considerable bor-
rowings which are usually negotiated
at this season. To these important
factors were added the possible COM
plications growing out Of the impend-
ing German drive. together with the
sensational disclosures touching Ger
many's efforts to influence public opin-
ion in this country.
Selling Stocks.
In such a situation 1t was not I'M
natural for the market to become un-
settled in the course of a reaction
which carried prices well below the
high level OF the year. But the selling
was not heavy, and what stocks were
offered were readily absorbed by a
market which at no time reflected seri-
Gus disturbance. Had the public been
specializing upon a large scale the re-
sultant liquidation might have as
sumed formidable proportions. But
I the movement gave rise to interesting
discussion concerning the extraordi-
nary demands upon the money market
in connection with the Governments
efforts to finance the huge OUTLAWS for
its own account and for the account
of its allies. Reduced to this basis
the question Is. Can the banks provide
|
securities and continue their large
advances to the Government through
the purchase Of short term Treasury
certificates of indebtedness?
"Slaelksr Banks"
The fact that only IS per cent. of
the l,o45 national banks. State banks
and trust companies subscribed for
their quota Of the initial $3.50, 900. 900
OF ~ per cent. Treasury certificates
Of Indebtedness showed that nearly
half Of the number Of banks con-
! cerned did not respond to the Govern
ment's call at all. The response in
future will be much more general since
the Federal Reserve Bank Of New
York will hereafter give out the names
Of all subscribing banks. with the
amount OF their application for each
subsequent offering OF the notes. SC
that the public may learn which are
the Stacker banks" This sort Of pub
licity will probably avail to bring into
the list Of applicants for the second
note issue most Of the 451 banks OF
this Federal Reserve district which did
not subscribe for the Offering of July
,. Tho one thing certain Is that the
banks OF this and the eleven Other
Federal Reserve districts must sub
scribe for their quota of Treasury note,
II the Government Is to be kept ir
funds until the greatest of all wal
loans yet issued is brought out in DC.
tober. 1t is clearly the duty Of these
banks TO take these notes in prefer.
| anna e. fnvaut ~, ante vta,dip~ a yo,,S
higher income return. II the banks
do not respond willingly they will b.
forced to respond unwillingly by 9
Government which is engaged II
financing the greatest war that tn,
world has ever seen.
} Financing Huge Loans.
But It viii not be an easy task fol
the banks Of the country to make ad.
vances to the Government each month
aggregating s per cent. Of their gros,
resources. Had the bankers veal
ago been told that they would hav,
been called upon at this time to fur,
nish $3.50. 0oo. 900 to the Treasury ever,
fortnight they would have beer
alarmed at the proposal. But the wal
has brought such startling changes IL
American finance and such a readjust
mont in business affairs as to fore,
every borrower to consider the Gov
: ernment's needs ahead OF all othe
needs so long as the world confiio
continues. The war OUTLAWS. there
fore. must be financed whatever tn,
financial burdens involved and what
ever the Inconvenience to private Dor
| II lrt,.
working admirably and the most per
feet cooperation exists between tn
Government authorities and those fl
control Of most of the thirty thousan,
, banks and trust companies of thi