The New York herald., 1922-03-17
FINANCIAL NEWS
AND COMMENT
Call Money Falls to 3 P. G..
Mercantile Rate Down and
Stock Trading Heavy.

Forces which have been making for
easy money all of this year were aided
Yesterday by the temporary factor in
volved in the quarterly Federal tax
funds were loaned on the New York
Stock Exchange at 3 per cent. for the
first time in more than two months.
More important still. the mercantile bill
rate broke through the long standing
per cent level. development which
had much moro than a passing influ-
ence on the monetary outlook. Choice
paper was discounted at AZ per cent.
and transactions at ~ per cent. were
reported. The downward movement in
costs of merchants borrowing has far
reaching application to the credit mar
ket being national and not merely local
mercfal paper and acceptance rates lent
further support to the growing expecta-
tion that the New York Reserve Bank
would lower It's rediscount rate before
vanced.
AS the relaxation Of money was de-
cidedly useful event for speculative
groups operating in stocks. It was not
surprising that the market displayed
great strength and comprised an ex-
ceptionally broad list of shares. For
the second day in succession the turn
y passed the million share mark. and
ere was any extensive distribution
OF stocks bought lower down the market
proved able to absorb such sales with
out tremor. Many new high records
were reached and for the first time in
encompassed nearly all the copper stock
department. The moro active industrial
issues advanced a point to points.
While the rails were sluggish, still at
tempting to determine the significance
Of the Great Northern's changed divi-
dend period, weakness was seen only in
Great Northern preferred and Northern
Pacific.
ulated by ease of money. Liberty bonds
and French Government issues being
prominent, and a heavy turnover OF
corporation bonds indicated that free
funds were flowing into them from
many sources. The presence OF large
amounts OF investment money was re-
flected in the Treasury's announcement
that 5000, 100000 of subscriptions had
been received for the new s25o.O0O. 900
Of one year AZ per cent. certificates.
Although the weekly Reserve Bank
statements showed that loans Of
member banks had been reduced sub
stantially. approximately $4,000, 900
for the system. members deposits in
creased s135. 5.50O,0OO. The enlarged de-
posits in the banks reserve account evi-
IDENTIFY was connected with Treasury
operations around March Is. and the
fact that that expansion was the chief
factor in carrying the ratio of cash to
deposit and note liabilities down more
than 3 per cent. to 1915 per cent. sug-
gested that the bank position would be
improved in a few days when seasonal
transfers should have been completed.
IL looked as though yesterdays price
changes in several markets were SYM
pathetic and directed to a degree by the
action OF money rates. Cotton went
forward 20 to 20 points and wheat
futures after an irregular start adj
vanced 9 to 2Ia cents a bushel, with
commensurate strength In corn prices.
More stability was apparent In foreign
exchange than was indicated on
Wednesday. After backing and filling
for time sterling moved up to 4.34h
q gain of about X cent. Others rates
except marks were firm. which eased
slightly.