New-York tribune., 1920-02-06
Bankers Take
Steps to Avert
A Money Panic
Understanding Reached at
Series of Informal Con.
ferences; Funds Available
for All Legitimate Needs

Wall Street bankers have taken
steps to prevent the development Of
a money panic. 1t was learned on
good authority yesterday, and con-
firmed in other quarters, that an
understanding has been reached at a
series Of informal conferences held In
the last few days. Details of the d's-
cussion at these conferences are not
available, but it is known that some
Of the bankers concerned have talked
about the matter with William n.
Remick. president of the New York
Stock Exchange.
Call loans at the Exchange were
Yesterday renewed at II per cent, the
highest renewal rate since January.
1903, and at least one large lender
refused to renew loans at less than
20 per cent. Later in the day the
general market rate ascended to 20
per cent. Bankers made it clear that
their new policy of providing for the
essential needs of the Stock Exchange
would not mean easy money and that
they would not finance gambling opera
tions either in securities or COM
modities.
Will Meet Legitimate Needs
However, they are acting to make
any readjustment that may take place
orderly and not excited. Commercial
organizations have been told that their
legitimate needs for bank loans would
be provided for. in spite of any tight
ening of the reins incident to the
campaign away from cverexpansion
which the Federal Reserve board is
directing.
On their own initiative the New
York bankers, it was ascertained, will
not formally revive the money com
mittee, which was called into existence
as an adjunct to the Liberty Loan
Committee by the Treasury Depart
ment during the war. Designed to
conserve credit in order to make large
government financing possible, the
money committee both kept the lid on
the market to prevent heated specula-
ton, on the one hand. and, acting as
q money pool, kept the market from
at fixed rate of per cent. Unless
resummoned by the government, the
money committee, as such, could not
function in peace times, in the opinion
Of some leading bankers, without vio-
lating the antitrust laws. Some of
the conferences of the last few days,
wholly without forniality, have been
held by telephone.
Stock Liquidation Continues
At the Stock Exchange liquidation
continued for the third successive day,
but was less violent than on Tuesday
and Wednesday,. Although declines
were general, selling was less urgent.
United States Steel common went be-
low par, to 99h, but recovered to
1905 Short covering and little
buying at bargain" prices gave more
steadiness to prices. although new low
Broad Street Curb prices again
dropped sharply, particularly in re-
spect to the new oil promotions.
In the cotton market, too, the feeling
of operators was perceptibly more
cheerful, and although prices dropped
sharply in the morning they recovered
part Of their losses later. Further
liquidation in the Chicago commodity
markets caused new declines in grain
and provision prices. Flour dropped
so cents a barrel in the Minneapolis
market to $13.75 q barrel, the lowest
price Of the year.
The most conspicuous improvement
was in the foreign exchange market,
whose panicky collapse earlier in the
week 2recipitated the torrent OF selling
orders in the security and commodity
markets.
Although so far as could be ascer..
tanned no fundamental change had
taken place in the international fnan-
ciai situation, which caused the rise OF