Evening star., 1920-02-02
HIGH MONEY RATE
CHECKS MARKET
BY STUART p. WEST.

2.-Prices started in higher on the
stock exchange this morning because
the bank statements published on Sat
ureday were considerably more favor
able than the street had looked for
This better tone continued for the re-
mainder of the first hour, but it quickly
disappeared when the first money rates
were announced.
In view of the improved bank position
it had been supposed that money would
at least be no higher than it was at the
close last week But instead the call
renewal. which had been marked up
day by day until it stood at IL per cent,
was this morning raised to IA.
This was an extremely stiff figure {;
it was the highest with one exception
that hays been fixed at any time since
the Federal Reserve Board begin its
| repressive measures last November.
Banking Powers Dubious.
The market interpreted naturally
this fresh rise in money to mean that
the banking powers were not i'm
pressed with the slight improvement t
in the federal reserve ratio last week
or with the gain in the surplus of the
New York institutions. They were
still evidently determined to keep the
money lid down tight and if not to
encourage further liquidation in the
stock market at least to discourage
any attempts at a speculative revival.
Along with the further advance in
money rates went another smash in
the exchanges. Demand sterling got
down to 3.47 and the continental rates
continued to fall.
Representatives of banking opinion
were certainly doing all they could to
spread uneasiness over the European
situation.
The contributions to this discussion
printed in the newspapers over Sun
foreign trade would be badly hit and
in time would so react as to bring
| a bout depression in business in this
/ country, were certainly the most pes
simistic that have been made hith-
erto.
Professional traders offered down
prices, but brought out few real
| stocks. Even the most sensitive of
| the industrials were not seriously
damaged. The rails were again in
clined to do better.
| Opinion still Divided.
| Brokerage advices sent out this
| morning were of a very mixed char
acter and anybody reading them all
| than ever what to do. Perhaps the
most definite idea was that the mar
ket might be expected to sag off
| again around last weeks lows. but
| that these low points would not be
broken This theory. the familiar
all of those who believe in chart
| reading Two of the leading houses
favored this theory I'D We're advis!n :
their customers accordingly.
On the other hand, another promi-
nent wire firm, which last week was
conservativeIy bullish. taking the
ground that the market was sold out.
was impressed by the bearish com
ment in banking quarters over Sunday
and was advising the sale of stocks
on all rallies.
Vigorous Selling.
The marking up of the call loans
renewal to IA per cent was the signal
| for vigorous selling movement.
After it had been in progress for some
! time a brokerage house sent word
down to it's representative on the floor
and asked what was doing.
! In reply it was informed that the
professionals and the Waldorf crowd
| have been selling stocks for the last half
hour" These two elements are not
noted for the big lines of long stocks
| which they have been carrying. If this
was all there was to the selling side
it was not very important. But. while
there was no liquidation of consequence,
| the buying power was weak and the
| professionals were able to offer down
! Prices LOT Il tlITe WltH some SucceSS-
, New York Central-At time when
the rails appear to have come back in
favor it is interesting to note what a
leading brokerage firm has to say about
the situation in New York Central. In
it's weekly letter this firm SAYS: 1t
has always been said of New York Gen.
trail, and in fact Of many other roads
whose financial structure is similar, that
except in prosperous times the relative
ly large bonded debt constituted a
menace. While this may be true, that
said menace may be obviated by eff
cient management, is proven in the case
of New York Central, which is one of
the very few roads of the country that
| have earned more than the dividend re-
| Quirements on their common stock dur
ing the period of federal control.
American Car and Foundry.
The fiscal year of the Anne rican Car
and Foundry Company, which ends
April 30. Is expected to be a good
one. The company carried over heavy
large amount of repair work. The
| statemen. is made that the year will
be good one. despite the fact that
the last quarter is expected to be a
lean one. unless there is a rush to
buy domestic railway equipment.
When the current fiscal year started
on May l, 1919, Car and Foundry had
cn hand something in excess of $780,
100000 of untitled car orders. This
included a number of millions of i'm
portant export orders. This was suf-
ficient to insure a good year even
though no additional business was
booked and, as events have panned
out, incoming orders have been some
what disappointing. 1t has been es-
timated recently that Europe alone
needs at least $50O,0oo,00O of equip
ment, yet very little of this business
has come to the United States.