There are two periods of the year when the stock market is affected by disbursements of money in the form of interest and dividends. The two dates at which heavy disbursements occur, are January 1st and July 1st. It is a popular belief that just prior to each of these dates, money will grow “tight” because of the necessary provisions made by banks and other corporations to meet such payments. Following the actual distribution of funds, it is the theory that a part of this money will seek reinvestment in bonds and shares. A great many speculators argue that this would naturally produce stringency, the possible calling of loans, and consequently lower security prices in the latter half of December and June and an advance early in January and July. While this reasoning looks sound enough on its face, it is not at all dependable. It is certain that everything is discounted in advance of actual events in speculative circles, and the more widely such theories as the one mentioned are disseminated, the more dangerous and inoperative they become. Instances are not lacking in recent years, where the technical situation growing out of this reasoning, has not only nullified the theoretical action, but has resulted in actual reversal, i.e.: an advance just preceding disbursements and a decline at the time the distributed funds were presumably returning to investment channels. Numerous shrewd people, anticipating an advance in January and July, have attempted to take time by the fore-lock by effecting purchases in December and June. Their buying, being of a competitive character, not only carries prices upward prematurely, but creates a weak speculative long interest, subject to disappointment if funds do not reappear in the volume expected, or susceptible to attack by great manipulators.