The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1910-11-21
Manipulation of Two Stocks
Chief Feature of Week.
GUEsSEs as TO THE OBJECT
Traders Speculate on the Forces
behind Union Pacific and steel
look still CIOuded-Cheap Money
One of the Redeeming Features.

said about the present stock market is
that strong pool that has as yet en-
countered no effective resistance seems
to be in complete control of two prom
inent stocks, the Union Pacific and
United States Steel common shares, and
to be able to mark the prices OF these
stocks up and down at its pleasure. 1t is
curious situation, and II will be in
teresting TO know how long 1t continues
ana just how 1t will end. So far as the
case mas now developed there. is no
market at all In the ordinary sense
OF the word IN the two stocks named.
All activity therein, whether for high
er or lower prices. appears 10 emanate
from single source, and. according TO
common gossip from a single individual
Only limited number of brokers exc
cute the pool orders, and when these
men are absent from the floor of the
exchange or arc not engaged in opera
uons the general stock market becomes
as dead as a door nail.
AS guessing what one individual cbooses
10 do from day to day, and almost from
hour 10 hour. is difficult. the greater
number of persons who buy and sell
stocks professionally for their own ac-
count are finding that they lose money
II they indulge in speculation either Tor
the rise or fall, and tho wiser ones
among them are rightly inclinefs 10 stop
trading altogether. There is. In fact no
speculation at all outside of Union Pacific
and Steel, and the rest OF the market not
only does not follow the advance In
these Issues but has in certain stocks be-
.trayed distinct weakness. presumably
upon fears as TO the permanence OF ex-
4 listing dividend distributions
Accumulated Heavy Line.
q appearances are, OF course, sometimes
ieceitful, but on the face Of things. what
Is going on IN the stock market seems
very plain II looks as II certain spec
uiators who in the month previous to
the election accumulated a great line of
the two stocks 10 which reference has
been made, and who have brought about
large advance in their price. were now
working the market IN an effort 10
dispose Of their holdings at somewhere
near current prices. which are probably
such as VIII entail a profit on the trans
action
This may not be the true diagnosis Of
the case. II may be that these speclIia
tors have judged the existing and mos
pectiVc situation better than other peo-
PIE. and that We are on the edge of a
great business and stock market boom.
Whlch some time hence viii make cur
rent prices look low. IT, however. the
diagnosis Is accurate, will the effort In
question prove a failure and end in
scenes or market decentralization. or will
It be successful, leaving the willy specu-
lators who have engineered II 10 cbucl,le
once more IA secret over their own cIev
erness and the gullibilty of their vie
inns! Meantime il is undeniable that the
market IN the two cliqued stocks derives
much or its strength from the circum-
stance that many smaller spectators arc
constantly bent upon fighting il ana iust
as constantly forced 10 cover their stocks
al higher prices. A critical time for the
market Is likely to be when this lighting
process ceases.
Outlook still CIouded.
The general business outlook. although
perhaps better than it was a few months
since, is still elouded, and homes or q
distinct Improvement center mora than
anything else around the possibility that
continued cheapness OF money may slim
u'a'e the bond market. Cheap money If
II prevails will almost inevitably lead -
certain sort OF bond market -,
even II the greater abundance of funds
= que al bottom 10 relaxing business
experience proves that relaxation ~
ID moderate degree may not
en- security prices adversely, since II
VIII Better enable buying Of stocLs ma
bonds to take place.
III. on the other hand the -al.,-o.,-. -
business becomes so nrono,,nc-'i ~, - =. |
doubt as 10 the security of intareet 81
dividend payments intervenes cbeanDesg
OF money VIII, OF course, in no wav aid
III pFhsihg about a Dull" market nor
VII even avert declining security prices
TIC trouble with our bond and stool,
markets. at the moment seems TO be that
Whlle no adequate reason for a general
or severe fall in prices may be found
yet That credit over the country Is 50 e,-
tended that there is little il any room left
Tor a sustained rise in securities.
Inc reports OF the national banks and
many OF the State banks and trust com
pahles soon 70 be published. showing
lheIr condition on November 10, will be
suen as TO spea-. authoritatiyely on this
subject; but II is universally expected
that A large excess of loans over deposits
will be exhibited, and an excess as large
- that reported in past years when
great trade expansion was in progress
and reaction was at hand
Loans ON Farm PROPERTY.
At the present time no one can say that
trade is heavily or unduly extended in the
eastern part Of the country, but every
careful observer from the West confesses
that the people in that section are. n
use a common expression, "au tied m"
IN loans made on farm property at in
creased values. and in a vast number or
business enterprises that trace their orr
gin back 10 the one source Of the great
elevation in the value of farm pr5ducts
IN recent years, The result Of all this Is
mat eheap as money is In Wall street n
IS not cheap at all for commercial or
Industrial borrowers, and Is quoted AZ a
very high price In the agricultural dis
tricts.
The Western planters and Southern
planters are now demanding that the
banks assist them 10 carry grain and
cotton instead OF selling il at present
prices which they declare to be unduly
ioW' and the banks 10 which these de-
mands are addressed are I'm turn asking
the financial centers TO rediscount their
paper. an encouraging development lat
teiiE mas oeen a fall in the price of meat,
when was, Of course welcome for its
heip IN sowing the cost of living problem.
II IS questionable whether this fan was
OF other than manipulative nature and
"he'her any sustained reduction IN the
actual cost OF living ls near There are
small II any signs OF improvements IN
general trade, railroad earnings continue
10 decrease, and there is no longer anv
doubt that the railway orders usually |
placed al this season for iron and steel /
materials viii be IN the neighborbood of