New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1920-04-13
10 Per Cent Money
And Strike News
Unsettle Market
Professionals Sell Clocks in
Afternoon; Sugar Shares
Strong; Treasury's Action
ON New Issues Notable

betWceH tHo uHIaVOrADlc eucCC upon
sentiment of the disturbing situation
arising out of the strike of insurgent
| railroad men and another squeeze in
call money, speculative efforts to carry
the stock exchange advance further met
with little ==c:ess yesterday. For the
news over the end Of the week was
almost entirely Of nature calculated
to discourage buying of stock and the
market relapsed into dull professional
affair. Stocks opened off, then became
firm when call loans renewed at 6 per
cent, but in the afternoon the sugges-
ton OF shortage in bank funds inS.
dlcaaed by the run-up in the rate to 10
per cent induced general selling.
Financial developments outside of
the market place were far more in
terestng than the performance at the
exchange. The announcement bv the
Treasury Department of the Offering OIL
two new issues of short term certiti-
Gates of Indebtedness at and 5A per
cent, respectively, was in many re-
spects the most significant step taken
py the Treasury in it's financial pro-
gram in long while. The per cent
rate is carried on three months issue
ana the pa rate on six months ma
turlty Recent issues have been going
on 4a4 per cent basis, but have not
taken we'll with the banks, because
market conditions have not warranted
such low rate of interest a
IN marking up the rate on it's new
offerings to the highest level carried
on United States government paper
since Civil War days the Treasury is
only giving recognition to fact when
!he financial community has been fac
ing for months. Industrial and rail
+ to ;ss corporations have been paying
nlgh rates for new capital for a long
time, because Of the greatly changed
condition of the investment market.
lnvestable capital is to be had,
but those seeking it must paw high.
The price. of capital has gone up with
everything else. The Pennsylvania ana
New York Central railroads, both of
good credit standing, were forced to
pay IN excess of Z per cent last week
Tor $50. 100000 in new capital.
The immediate effect of the change
IN rate by the Treasury in the financial
markets yesterday was reflected in the
weakness of all the outstanding gov
eminent war issues. The decline be-
came pronounced in several of the Lib
erty Loan issues. which fell to new low
records: The second 4s and AIS de-
cllned below 88. A further readiust-
ment of prices is to be expected.
Although speculative Wall Street
still clings to the tradition that il
never pays to sell stocks on strike news.
the present railroad labor situation and
ITS effects upon industry in general
have dampened enthusiasm and dis
couraged for the time being aggressive
operations for the rise. Yesterday the
demand for stocks was lighter than it
has been in more than a week The
sugar shares constituted a group of
stocks which moved against the gen
eral market current, registering stri<-
ing gains, which were we'll held. Rail
way equipment issues were weak at the
close, with Pressed Steel Car an OK
ception.
Continuation Of the strike for anv
considerable period is likely to be an
important influence in the money mar
ket. The delay in getting goods to mar
ket will result in tying up credit. AL
ready banks are beginning to feel the
effects of the strike in this way. The
drawing down of funds on deposit here
by interior banks yesterday is said to
have been one. of the principal causes
of the Tightening in call money APP
proximately $5,0O0,O00 in gold was
taken for export to South America. The
exchanges were lower, with rates on
Paris and Rome falling to new low rec
ords.