The Stock Market and the Shooting

     While the space of twenty years results in many changes in the stock market, there was a general disposition almost as soon as the news of the attempted assassination of President McKinley was received to compare that event and its consequences with what ensued in the financial market after the announcement of Guiteau’s attempt on the life of President Garfield in 1881. Wall street was thrown into something like a state of fear, although the news from Buffalo came on Friday night after business had closed for the day, and both the financial authorities and the public had, therefore, time to think and act, while Garfield’s assassination was reported when the stock market was in session, and was, therefore, a bolt out of the clear sky. In 1881 the market had practically reached the culmination of an advance in prices, the result of a bullish speculation which had carried values beyond legitimate levels. It was ripe for a reaction in any event, and the bull market of that day would have doubtless received a crushing blow from the deficient crops of the year even if the then President had served out his time without bodily injury. In the present case, while advances in prices from the low level of five or six years ago rival those which were seen in the stock market during the greatest of former booms, it is the general feeling that intrinsic values are now more nearly reflected in the quotations than at any former period in the financial history of the country, and that the stock market has gone through a speculative liquidation since the Northern Pacific corner of last May. It is recognized not only that is the earning power of railroad and other corporations vastly greater, but that in the conduct of corporate affairs a much higher standard prevails. Besides this, the wealth of the country is vastly larger and its banking system better organized, while investment plays a much greater part in making stock-market values than at any time in the annals of Wall street.
     On last Saturday the action of the stock market justified to a considerable extent the real feeling of alarm which existed and found expression on the part of financial and speculative interests. There was heavy selling of securities by both foreign and domestic holders. The declines were, in fact, quite as severe at the opening of the market as those which followed the receipt of the news that President Garfield had been shot. Unlike the situation which existed in 1881, last Friday’s crime, however, found Wall street’s organization for the preservation of values and the prevention of panic well-nigh perfect. The leaders of the banking world and the large interests of the street had without doubt conferred over night [sic], and resolved upon a united course of action. The support which was extended to the stock market on last Saturday and Monday was both effective and well devised. To all appearances any disposition on the part of the general public to throw away securities on the idea that the President’s condition was worse than had been represented, and that the chances of his recovery were small instead of bright, was checked by the readiness of the syndicates and pools interested in various railroad and industrial properties to take all offerings at moderate concessions. This resulted in the accumulation of very considerable amounts of stocks in the hands of what are generally termed the big people of the street.
     As soon as the public became reassured regarding the President’s condition, as was the case by Tuesday, a large buying, however, reasserted itself, and the pools which had been formed to support the market were able to resell a considerable part of the stocks which they had bought for the purpose of supporting the market and preventing a break. Little of this kind was seen in 1881, although at that time the leaders of the street exerted themselves, not without temporary success, to sustain prices, but they were in the end forced to abandon the task and allow the liquidation, which seemed inevitable under any circumstances, to take its course. The way the market has acted in the past week under very trying circumstances is held to attest its generally healthy condition, as well as the force and power of the elements which are ranged in support of the existing level of stock values.
     This was again demonstrated when the unfavorable developments in the President’s case on Friday caused a renewed decline in the market. The same support was again seen, and anything like a violent break in prices averted. It may be said that the street at large was disposed to discount the worst as regards the President. It did so, however, without panic or exaggerated excitement, and has acted throughout a crisis in a way which deserves commendation.