Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-03-20
Wall Street and the Country.

Yesterdays stock market Jump was evil
IDENTIFY an instance of genuine bear acti'ity'
without special reference to the general sit-
nation The market Is naturally weak and
feyerish after last weeks exciting expert
ences and in a condition to respond quick
" to the favorite tricks of the short
traders. A few pessimistic rumors. art
fully spread by the means which the pears
know so we'll how to employ to the pest
advantage served to depress the prices
quickly and for time there were signs that
to the un:nitiated might Indicate that 'he
experiences of the past few days were 10
be repeated. But the falsity of the fai,ur
rumors was quickly established and the
market rallied before the close
good deal is heard during these parious
times about intrinsic values and earning
power Some pessimists are shaking their
heads and predicting a fall In the real
values of the market securities. They
argue in inverse order that the stock mar
ket controls the general industrial situa-
ton 1t has always been the general be-
lief that the industrial situation controls
the market. The law of supply and demand
has not yet been repealed and it Is as opera
tive TODAY as it ever was THE stock market
Is a reflex of the trade conditions. The price
of securities may be forced up or down
by artificial means. by booms or raids but
unless there are genuine elements of weak
ness in the industrial condition Of the coun-
try they cannot materially affect the actual
worth of substantial properties These up
ward and downward movements may cause
disaster to spectators, the former by
tempting them into the market beyond
their resources, and the latter by wiping
out their margins and forcing them into a
panic producing liquidation, but as long as
the financial institutions of the country re-
main on a sound basis. which Is to say as
long as they are we'll managed, and the
crops are good and the trade remains nor
NAL there can be no shrinkage in intrinsic
values.
The only connection between the stock
market and the Industrial situation which
makes for a possible period of hard times
lies in the fact that trade prosperity is in
large measure the result of that subtle ele-
ment called public confidence If that is
weakened buyers become conservative. The
market may, by repeated wild plunges.
bring men to fear that bad times are COM
ing not because of actual conditions at
present in evidence. but because of appre-
hension lest forces may be at work under
the surface to undermine the foundations
OF prosperity Inc mysterious ana the uI-
known are always factors for depression.
But it has been noted Lately by keen OBJ
servers of the countrys trend in finance
and trade that the public is better educated
than ever before and that this education
is evoking spirit of courage which Is like
ly to enable the country to weather indus
trial storms better than ever. panic is
primarily reflection upon the intelligence
or at least the nerve of those who succumb
to it's influences, and the better the country
becomes organized and the more thoroughly
it understands the financial economic laws
and appreciates the truth that the stock
market is. or should be. mercy an indi-
Gator and not controller. the less frequent
and serious will be the spasms Of contrac-
ton in trade that are now regarded by some
inevitable consequences of great indus
trial activity.