The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1912-09-23
STOCK BUYERS
PROVE CAUTIOUS
Special Securities that Have Been
Relatively Too Low Are
Chief Attractions.
CONSUMERS NEED SUPPLIES

New York, Sept. 2z-Action of the
stock market last week proves that
those persons who are willing to buy at
all are displaying considerable discrim-
ination. They are picking out special
securities that have been relatively too
low. While the great mass Of stocks Is
fair under Its proper level. compared with
other things in the United States and
with earnings present and prospective.
there are some securities that are abb
surdly cheap when compared with others
selling alongside of them. This fact ac-
counts for the violent movements In
recent days OF such stocks as American
Can, Cigar Stores, and United states
Steel.
The market Just now is largely a mat
ter of money supply. Conservative lead
ers are in charge, and they do not want
to get the public into the market yet
to such an extent as to interfere with
productive business enterprises. Great
volumes OF money are needed just now
in moving the crops and in filling orders
received by manufacturing concerns. The
consuming public is short OF supplies
having purchased from hand to mouth
and now that they see big improve
ment coming in all directions they are
falling over one another trying to get
their orders at the head OF the list. The
result Of this is that premiums are paid
in nearly all trades. The premiums In
the steel trade alone amount to mate
rial increase of prices. In some par
ticular enterprises there is an absolute
inability Of the producers to keep up
witt the demand. This Is the case in
regard to the Can Company. although
It made several hundred million cans in
anticipation of a great supply. and had
them stored in various parts OF the coun-
try.
Expect Heavy Export.
Because Of the surplus crop produc-
ton in America and the deficiency Of
lest export movement ever known. This
will force the Bank of England and the
Bank Of France to advance discount
rates to provide money for financing
these crops. The Bank of England will
be compelled to advance its discount
rate to provide for the necessities Of the
English import business. The higher
money rates go in Europe and America
the higher stocks will go, because mon
ey rates this year mean big business.
There being nothing in the money sit
uation to worry about. some people are
trying to get excited over the decisions
that will be handed down by the Su-
preme Court in October or November.
These decisions will be of extreme i'm
portance All of them have been fully
argued. Among them is that involving
the rights OF the Union Pacific to pur-
chase control of Southern Pacific. The
Minnesota rate cases will also he decid-
ed. and there are twenty-eight other
cases OF a similar character. but IL is
believed that the Minnesota decision
will be the ruling one. In that case the
United States Court OF Minnesota au-
thorized the Great Northern Railroad
to earn as much as per cent on its
capital invested. and IN order 20 learn
how much that might be the court had
an appraisal made of the property.
which showed that the company is
greatly undercapitalized.