Evening star., 1926-04-18
By ]. A. FLEMING.

It is difficult to understand that
there is not the slightest stringency
in the money market at the present
time. Evidences of this fact continue
to multiply and yet call loan rates
were advanced with some persistency
until the bull market was given a
sickening Jolt.
Gossips from Wall Street told the
story daily Of the manner in which
the reports Of the Federal Reserve
banks were watched from week TO
week for indications of an advance in
the discount rate The shipment of
$35 900 900 from New York to Cuba
and a smaller amount to- the same
place from Atlanta was given as the
cause of the serious slump in stocks
on the date of the shipments.
Money has always played a part in
the New York stock market and
always will. 1t doesn't seem just
right to credit the recent cessation
and reverse of the great bull market
to money directly or indirectly, with
such an abundance Of the circulating
medium in the banks and in the
treasures of great corporations.
It would seem better to say that
those who controlled money pulled
the purse strings tighter for a specific
purpose"
Checking Heavy Speculation.
When brokers loans reflected their
zenith. bankers put the screws on,
despite the plentitude Of the circulat-
ing medium, as part of wisdom. and
to teach the bulls that the market.
unlike the little brook, did not go
one way all Of the time. 1t has been
necessary to press home this lesson
from time to time. when the disposi-
ton to start another bull market has
been evidenced, following a bull
market Of a years duration, even
more.
Caution contributed to the necessity
as viewed by the banking fraternity.
France has been under the strictest
observation as TO its financial con-
dition and other sections Of Europe
cause continual uneasiness.. -,
Business at home has been fairly
good. but in some lines decreases in
volume are noted with uncertainty as
to the future. Political matters are
stewing away at a great rate, and
altogether makes for caution and not
eXpansion-but the money market. on
the basis Of supply and demand, is in
no way responsible for uneasiness or
uncertainty.
There can be no better evidence of
the truth of this statement than the
manner in which investors take every.
thing in the way of bond offerings that
have merit, with brokers on the
watch for issues and investors ready
to buy. -
Likewise Federal financing is car.
ried out with the greatest ease at low
rates and banks are purchasers of
large amounts Of short-term maturi-
ties on the assurance that they will
sell above subscription price almost
Immediately.
Of late great Industrial corpora
tions and railroad companies have
been competitors with banks in the
call loan market in New York, a fur
ther indication of the ease Of money.
What Reserve Statement Shows.
The Federal reserve statement
with 73 per cent Of the reserves on
hand is further evidence that supply
is not lacking Of the, essential.
Bills discounted show about $3.50
between those backed by Government
securities and other collateral back Of
the bills rediscounted and this Is prac.
tically securing one-half Of the redis-
count with almost actual dollars, indi-
eating that bankers are very strong
in their resources.
Commercial banks and trust com
panies as we'll as savings banks cor
daily welcome the applicant for loans
with collateral while any one entitled
to accommodations seems to find no
trouble in securing loans.