The New York herald., 1921-02-03
FINANCIAL NEWS
AND COMMENT
Short Selling Increases as Call
Renewal Rate Rises - Ex-
change Still Gains.

Stocks came yesterday morning under
the shadow of the highest renewal rate
for call loans since November IT: in
sales for the short account should have
been more extensive afterward than on
the day before. An 8 per cent. rate for
standing loans. which preceded an adj
vance to 8 per cent for new borrowing.
had not been considered as a possibility
during the period of and per cent.
funds In the last half OF January.
Around the middle of last month when
offerings became so plentiful that call
loans were placed for day or two at
and under per cent In open market
transactions, Il was felt in many quar-
ters that while there might be brief in
tervals Of higher charges. a rate of
per cent might be looked forward to as
possible maximum until the money
market became permanently easier. The
Government is to withdraw about s14.-
100000 from its local deposits to-day.
but the decided stiffness OF the money
iiieAf hch7 hAIAd0AhS SOAkAIcteA eAA tAAiio Aohkis
and rediscounts OF acceptances. shows
that more important Influences than this
have been at work this week Last
York were evidently drawn down heav-
Yorw were evidently drawn down heav-
lily. and the trend of money forecasts
further reflection OF this movement In
the forthcoming weekly bank reports.
But this Is by no means an unsatisfactory
development for the banking situation as
a whole. for the condition of tho Fed
eral Reserve system indicates that mem
ber banks of the agricultural and some
manufacturing communities have been
using deposits lately in Eastern cities
to retire rediscounts. Tho report Of last
Saturday showed that rediscounts the
country over were nearly s283. 3.oo0. 900
less than they were at the end Of 1920.
while Federal Reserve note circulation
had fallen s25s.soo.oo since Decem-
Der 80.
Sugar shares canse under especial
pressure. explainable In part by the
current competition between refining
companies at declining prices. Oil
reported by one or two mail order
houses in January, compared with the
same month OF last year. drew beartsh
attention to their shares. Liberty bonds
were stronger In several issues. and
somewhat heavier in others than on the
day beforeA The fact that steel stocks
were fairly steady in the face Of the
weeks trade surveys spoke well of the
markets realization OF conditions within
the industry. The Iron Age reported
that pig iron production in January
was some 100000 tons less than in
December. and the total output of 2.405,-
s45 tons was less than In any month
since May. 1915. leaving out of the COM
parison May, June and October of 1919.
when a strike hampered operations. AS
iron production is to be interpreted In
terms of steel mill activities, II Is evil
dent that the industry is preparing for
light operations for some time to come.
The recovery in late transactions on
Friday was continued in the foreign
exchanges yesterday. The market was
free of the erratic and confused fuctu-
ations of speculative sentiment which
marked the business of Friday, al
though there was nothing new in either
the German reparation situation or in
foreign trade developments to influence
quotations. Sterling advanced from
3.SsA to S.S5. and francs gained 10
points to ia cents each.
The German rate was firm at 1907
cents each. Other European rates were
steady in the main.