The Hawaiian star. [volume] (Honolulu [Oahu]) 1893-1912, 1912-01-04
HIGH LIVING
AFFECTS STOCKS

Inc nigh cost OF living Is having
it's effect on Wall Street and will prob
ably have the effect of keeping a con-
siderable proportion of the January
disbursements from coming on to the
street for permanent investment, &C
cording to Henry Clews in his circular
letter of December %. Mr. Clews
writes in part:
Holiday quiet overshadows the
stock market. This is the period for
closing accounts, stock taking and
other operations incidental to the close
of the year. Aside from activities
connected with the holiday trade, it
is apt to be one of the dullest periods
of the year. In the stock market pro-
per it is usually a time when every
effort is made to anticipate the effect
of January disbursements. This year
these are estimated at over $220,000-
900 The question arises will the usual
proportion of this sum come into Wall
Street for permanent investment?
There is some reason to expect that
it will not. The main reason is the
high cost of living for all classes.
Whether this be due to high prices,
to extravaganza or to higher standards
of living matters little. People are
certainly saving less, and as all new
capital must come from the nations
savings it follows that there will be
smaller proportion applicable for in
vestment purposes than usual. An
other element in the business situa-
ton is that the high cost of living COM
pels Investors to seek and insist upon
the largest returns possible on invest
ments. The same tendency towards
better returns arises from another di-
rection-namely, that a reduction in
the supply of new capital will oblige
those who want it to pay higher rates.
In short, as a result of existing condi-
tions, capital is going to command
better wages just as labor has already
succeeded in doing. What the effect
of this will be upon the financial stu
alton remains to be seen.
General business is quiet. Condi-
tons, however, appear sound. There
is not so much complaint about the
volume of business as about profits.
In the interior rather more cheer
full tone prevails and bankers at the
West anticipate moderate, but not
very pronounced improvement. 1t
must be remembered that last year
was not a season of big crops. On
the contrary the total yield was slight
ly below the average. There was one
striking exception. The South pro-
duced a crop of cotton far beyond ex-
pectations and much too large for cur
rent requirements.
The money situation is reasonably
satisfactory. Some slight stringency
may develop towards the close of the
year, but this will be only temporary.
Funds will very soon be coming back
more freely from the interior and con
siderable American money is still en-
ployed in Europe, where it can be re-
called when necessary. The situation
abroad is generally satisfactory.
Concerning the immediate future Of
the market, we would advise caution.
In the active stocks there has now
been an average rise since the low
point of last September of about ten
points and considerably more in a
number of the specialties. Facts of
some significance regarding the own
ership of our principal railroads and
industria!s have been published this
week They showed that ga railroad
and industrial concerns with a com
bined capital OF S1O,7O0,OO0, wee
owned by atout 100000 stockholders,
their aveis,, holdings being ab@ut il 9
arares. the significant fslture Of tbs
statement, however, was tina, OF an
increase Of only 11a per cent in calh-
tai reported there was an increase Of
I pcr cert in the number Of stoct.
holders.