The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1929-03-26
Call Money Rate Scars to
20 Per Cent; Highest
in Nine Years.
SMALL TRADERS SUFFER
Excited Dealers Thronq
Offices of Brokers; Seek
to Save Ruin.

NE w Ohh, March 26.---
Call money swept upward to
20 per cent today, the stiffest
rate in nine years, and brought
with it on the market one Of
the worst breaks in the Stock
Exchange history.
Losses Monday and today, through
the tremendous drops in long ball
looming market, were estimated to
run into several billion dollars. The
high money rate had its echoes
throughout the land
Small and large traders were hit
by the continued slump; all security
markets we're affected and nearly all
commodity markets were under
pressure.
Curb Market Crashes
The stock market break brought
sympathetic crash in the curb
market; lower prices in bonds. es-
pecially convertibles; demoralized
the Chicvago grain market and
forced a decline of more than 81 a
bale in cotton on the New York
Cotton Exchange.
Small traders, the men and
women throughout the land, who
had envisaged "easy money"
through the market, saw their
profits crumble into losses, and In
thousands Of instances their capital
wiped out as their margins became
too small.
Grain traders sold wheat reck-
lessly because of the high cost of
carrying it on borrowed money.
The 20 per cent figure was the
highest since February, 1920. when
the rate touched 25 per cent.
Exchange Facilities Taxed
Prices crashed following the post
ing of II per cent money where they
had been rallying slightly after the
break induced when the figure went
to Is per cent from the renewal rate
Of IL per cent.
Brokerage houses were Swarmed
with excited customers as the word
was passed about Of bad break in
the stock market Great confusion
also existed on the floor of the Stock
Exchange and brokers rushed to fill
orders. The facilities of the Stock
Exchange were severely taxed and
tickers ran nearly an hour behind
the market.
Standing room was premium at
most Of the downtown brokersage
Offices, while uptown branches met
difficulties in taking care of angry
and excited traders.
Banks Withdraw Funds
Orders to sell were also pouring
into the market from all sections
Of the country and the steady up
ward movement of prices during the
past several months was quickly
wiped out IN today's tremendous
realizing.
The facts that banks continued to
withdraw huge sums from the call
loan market was largely responsible
for the call money rate rise, and
offerings of new funds we're exceed
ingly scarce at the official rate Of
II per cent. Interior banks were
withdrawing funds in large volume
to meet difficulties at their respec-
tive centers. The demoralizing break
in the grain future market at Chi
cago also created great apprehen-
sion.
Reluctant on Loans
Banks were exceedingly reluctant
to make new loans. Coming at a
time when large amounts of funds
are needed for the April l interest
and dividend disbursements, a great
shortage Of funds developed.
AS the market entered the final
hour, the tape was sixty-four min
utes late. There was no way to get
prices from the floor except the
few sent every ten minutes on the
bond ticker. These indicated that
the market was rallying despite 90
per cent call money, the highest
since Feb. 5, 1920.
The tremendous break earlier in
the session had improved the techs ).
nical position to such an extent that
little was required to bring a rise.
Sales Near Record
However, the prospect Of firm
until quarterly interest and
individual payments were cleaned
up at the nonth-end prevented
buying in amounts sufficient to
bring a concerted recovery.
Sales bid fair to exceed all pre-
yious records in history. totaling
) ,639. 400 shares to 1:30 p. m. larger
han the majority Of full days for
the last several weeks.